We spoke with Beth Ehrgott, Managing Director of The Alexander Group's Life Science Practice to learn what is on the minds of executives within this sector, and the challenges and outlook for the coming year.
TAG: What are some of the challenges the Life Sciences sector is currently facing?
Beth: Life Sciences is a broad, catch-all term that describes many types of healthcare companies. What all of these segments and niches have is common is a need to constantly drive innovation, manage costs, and successfully navigate the ever-changing global regulatory environment. In the industry, this is often referred to as the three C's: Customer, Cost, and Compliance.
I recently attended the JP Morgan Global Healthcare Conference and where industry leaders and CEOs spoke on a wide array of topics, including expectations of the new administration, direction of the industry and the industry's shared goal of developing new drugs to treat, improve and save lives.
TAG: What are the most significant customer and general business challenges for Life Science companies?
Companies need to shift to a more holistic, patient-focused model and invest in technology to leverage digital expertise (social media and networks, mobile apps etc.) to gather data, monitor patient outcomes, etc.
Companies need to improve patient engagement. Patients, family care providers, and patient advocacy organizations are becoming more educated and involved in patient care and demanding improved treatment options and reduced costs.
For healthcare providers/KOLs (Key Opinion Leaders) and healthcare payers, there is an increased focus on pricing, whether it is due to drug price scrutiny or reimbursement and market access issues.
Healthcare payers are squeezing pharma companies to reduce the cost of drugs, all while requiring more data to prove value (clinical - patient outcomes data and economic value), and squeezing healthcare providers on cost for service.
TAG: What are the cost challenges Life Science companies face?
Beth: The average cost to develop one new medicine is $2.6 Billion, so companies are focusing on how to manage increasing R&D costs, manufacturing costs (especially with the Trump Administration pushing to repatriate manufacturing), market access, compliance and the commercial costs involved in bringing a new drug to the market. In order to survive, biotechs need significant investment to sustain early stage development, further highlighting the need to increase operational efficiencies.
It is in the best interest of the industry and all of its constituents to have dynamic and talented strategic and operational leadership in place to drive impactful disruption. Companies are facing the dueling interests of reducing wasteful spending versus advancing technological modernization and specialization.
TAG: What hiring trends do you see as companies strive to address the "Three C'" challenges?
Beth: In order to tackle these challenges, the Life Science sector needs strategic and operational leaders who can effectively:
Drive innovation - transform the culture and mindset, reorganize organizational structure as needed, invest in required resources and tools, and place a high value on talent - hire, develop and retain top performers.
Navigate the complex, constantly changing, and increasingly risk-averse global regulatory environment.
Treat the patient as a partner. Patients are more informed and involved in decision-making about their care. They are demanding more options for both treatment and cost. Patients have more of a voice and will continue to be a driving influence with both providers and payers- thus drug manufacturers need to pay close attention and build increased engagement.
TAG: What role do you and The Alexander Group play in helping clients address these challenges?
Beth: Clients retain The Alexander Group to conduct searches for change agents and executive leadership across all functions, from R&D to TechOps, Commercial and corporate executive functions including Finance, Legal, Business Development, Human Resources, Information Technology. We believe the demand for high-impact executives will continue to increase. This is the new norm - there is no status quo.
We take tremendous pride in building strong collaborative relationships with our clients and, partnering to craft the best strategy and execution plan to tackle their many challenges.
We bring creative counsel, strategy, and perspective to successfully recruit executive leadership globally across all functions that have the ability to effect change. Our mandate is to attract top talent for the immediate role and also to recruit executives who will continue to make an impact and add value over the long term. Our stellar research function allows us to conduct targeted research and cast a wide net to ensure we identify and recruit both active and passive candidates. Our partnership continues through assessment and helping our clients select and recruit the ideal executive, to onboarding and continuing to build upon the relationship.
Beth Ehrgott is Managing Director of the Life Sciences Practice at The Alexander Group. The Firm's Life Science Executive Search Practice, established twenty-five years ago, includes clients from all areas of the global healthcare landscape. We have conducted searches for executive roles in Big Pharma, medical device companies, early stage biotechnology companies, medical academia, not for profit organizations, biotech venture capital firms, and private equity firms with life science portfolio companies.