Pharmaceutical consulting, according to the latest estimates from the Business Monitor International’s Pharmaceuticals & Healthcare Business Environment Ratings, may be positioned to play an increasingly valuable role over the next five years. Projections for the fourth quarter of 2010 and beyond indicate that industry growth is likely to be meager at best.
Although the US pharmaceuticals market is currently in good shape, being ranked first regionally and internationally, the compound annual growth rate (CAGR) over the next five years is projected to be only 1.76%. This slowing growth will be the result of a coming confluence of factors: patent expirations, increasing FDA scrutiny, pending healthcare reforms, the wider economic climate, and decreasing use of medications and medical services. With this imminent industry environment, pharmaceutical consultants may well be the key competitive-edge factor for many companies.
The previous quarter of 2010, especially with respect to the OTC segment, saw several events that will likely culminate in greater compliance and regulatory burdens for drug manufacturers. Johnson & Johnson, for example, has withdrawn 21 lots of medicines, including certain Tylenol products as well as Benadryl and Motrin. Further, the FDA recently initiated a new program for posting online safety evaluations of drugs and vaccines that have been recently approved. And in August of this year, major groups in the consumer, physician, and chemical-manufacturing arenas pledged to support a proposed bill intended to protect the US drug supply by allowing the FDA to expanded authority to “safeguard” pharmaceutical supply chains.
Intimately bound together, the economic climate and healthcare reform strategies will also play a role-a role that opens the door wider for pharmaceutical consulting-in the projected five-year industry slowdown. Real Gross Domestic Product (GDP) is expected to decline from 2.8% this year to 1.8% in 2011. The weakening economy, along with the dismal labor market, means that fewer patients are choosing to fill prescriptions, and the number of medical services used by insured people is falling.
All of this means that companies can benefit more than ever from the services of knowledgeable pharmaceutical consultants. The outlook is far from bleak: pharmaceutical spending in the US was nearly $306 billion in 2009, and the market is expected, by 2014, to reach $334 billion in value at consumer prices. Still, competition in a market with decreasing growth and a growing presence of the state is increasing, so ensuring a competitive edge becomes that much more important. Preventive treatment for both patients and the industry is crucial right now.
Pharmaceutical consultants can provide assistance in these increasingly critical areas:
• Quality and compliance
• Good manufacturing practices (GMP)
• FDA regulatory concerns and adherence
• Laboratory services
• Lean manufacturing
• Training and coaching
And the best consultants possess the ability and willingness to examine situations and problems from every perspective and thus, by analysis and testing, formulate multiple possible solutions. Then, management and consultants, together, can determine the best solution.