Healthcare slow to benefit from digitalisation
MELBOURNE: Heavy regulations, pricing power and a history of failed IT projects were to blame. Technological advances are changing that. Tuesday’s tie-up between Google and French drugmaker Sanofi to create a “virtual innovation lab” is the latest example.
Short on financial detail but long on rhetoric, the announcement hailed “a new age for biology and human health”. Combining Sanofi’s science and data with Google’s cloud computing and artificial intelligence promised to accelerate discoveries, it said. It would also advance the push for more personalised medicines by matching the right drug to the right patient.
Sanofi, which wants incoming boss — ex-Novartis executive Paul Hudson — to improve its digital capabilities, is in line with its competition. This month Eli Lilly signed a deal with AI specialist Atomwise, to discover new drugs in a deal worth up to $550m. Last month, Alphabet’s health division Verily announced partnerships with Novartis, Otsuka, Pfizer and Sanofi to accelerate clinical testing using digital tech. Verily has also partnered with companies including GSK, Biogen, Novartis and J&J. A joint venture agreed with Sanofi in 2016 is aimed at improving diabetes care.
These moves might not pay off. The “AI winter” — a 1980s term describing a dark period of low funding and interest after AI technology hype backfired — might return. Incumbents should also be nervous about the tech sector muscling in. Big US tech companies spent nearly $5bn on healthcare acquisitions between 2012 and September 2018, says CB Insights.
But the pharma industry — bolstered by its scientific and regulatory expertise — has more to gain than lose.
Amid growing pressure on prices, drug development needs to become more innovative and efficient. If technology improves the development and targeting of new drugs, the benefits will be shared widely.
