Title (Arial bold 30 point) second line title · Blockbuster drugs Pharma 2.0 ... Brand Value...

Reframing Innovation

Progressions 2012 — The third place: health care everywhere

Reframing Innovation The third place: health care everywhere

HBA 2012 Leadership Conference

Enlighten Empower Evolve

Carolyn Buck Luce Ernst & Young Life Sciences Leader Emerita

HBA 2012 Woman of the Year



Agenda

Patients: nudging patient behavior

The third place: health care everywhere

Business models: creative disruption

The ecosystem: aligning for impact

Be the change: Finding the leader within



Drivers of change

Business Models

Customer

Value proposition

Pharma 1.0 Blockbuster drugs

Pharma 2.0 Diversified drug portfolios

Pharma 3.0 Healthy outcomes

► R&D productivity

► Patent cliff

► Globalization

► Demographics

► Pricing &

reimbursement

► Health care reform

► Health IT

► Consumerism

► Value mining

Physician Payor

Patient

Pharma 3.0 From pharma’s perspective



Pharma 2.0 Diversified product portfolio

Product-centric; B2B

Revenue/Margins

Product Efficacy

Pitching

Acquisition of product Companies

Product Development

Approval based on clinical trial data

Pharma 3.0 Health outcomes

Customer-centric; B2C

Health outcomes for patients

Customer Experience

Listening and co-creating

Innovative partnerships

Development of new businesses and markets

Reimbursement based on real market effectiveness

Pharma 3.0 — the shift from products to health outcomes

Business Model

Value Drivers

Brand Value

Go-to-market strategy

Inorganic Growth

Innovation

Information



for improving health outcomes is The single biggest opportunity

Behavioural change

Health care costs

2010 2050

World population over 65 Drivers of health outcomes

Chronic

disease

75% 0.5 b

1.5 b

Behavior

50%



Women are generally regarded

as “caregivers” and often

neglect their health to take care

of family

► Social stigma of diseases

► Cost burden

► Lack of insurance

► Misaligned incentive among

physicians

Lack of proactive self-

health management,

motivation and low

awareness about diseases

Poor diagnosis due to

asymptomatic nature of

diseases and lack of

appropriate diagnostic tools

Promise of personalized medicine, requires interventions addressing the

value leakages resulting from clinical, social and behavioral gaps in the

patient care pathway



Today, health care is delivered in

two places

Results

Annual physical

Lab tests

Inpatient care

Wait to hear

Hospital

Doctor’s office

Rx Diagnosis

► Periodic

measurement

► Treatment

of disease

► Opaque

► Providers

have control



Welcome to

► Periodic

measurement

► Treatment

of disease

► Opaque

► Providers

have control

► Continuous

monitoring

► Prevention,

behavior

► Transparent

► Patients

have control

the third place The third place is

the patient

Medicalized

consumer

devices

Consumerized

medical

devices

Caregivers,

other HCPs

Providers

Social media Smartphone

apps

Sensor

data

Data,

control

RT monitoring,

prevention

Insights,

feedback

Tele-

health

Remote

care



175,000 tweets

700,000 messages sent

20,00,000 videos viewed; 48 hours of content uploaded

7630 stumbles

7610 searches

2083

3125

3500

1090 Visitors

Check-ins

Photos uploaded

New friend connections

60 seconds in Social Media



Growth opportunities

► New business models

► Less pricing pressures

► New sources of revenue

► Customer-driven innovation

► New approaches to R&D

The Third Place – healthcare everywhere Drivers and opportunities

Changing the game

► Efficient resource usage

► Transparency

► Coordination and prevention

► Increased access

► Personalization everywhere

Payor

Pre-

disposition

testing

Diagnosis

Treatment

Health

management

Prevention

Physician

Hospital

Changing Technologies

► Smartphone apps

► Sensors and monitors

► Social media

Changing economic incentives

► Payment reform

► Holistic care



A Forth Space

Source: The Digital Dimension of Healthcare: Report of the Digital Innovation in Healthcare Working Group 2012



Patients: patient behavior nudging



Are we rational? We are irrational

► Opt-in organ donation

► A longer, healthier life

► Pleasure from gaining

$100

but predictably so…

► Opt-out organ

donation

► A donut today

► Displeasure from

losing $100

► Opt-out organ

donation

► A donut today

► Displeasure from

losing $100 = > …and the predictability of our biases means

that we can correct for them



Patient

Gaps in patient behaviors

Processing

information

Problem: big data, complex data

Solution: relevant, neutral information

based on individual circumstances

► Personalized to circumstances

► Made relevant

► Information on choices and

trade-offs

Resisting

temptation

Problem: hot states vs. cold states

Solution:

► Technologies to manage behaviors

in hot states

► Social networks for feedback and

reinforcement

► Gamification to create motivation

► Contracts to lock in behaviors



Embedding Incentives to Change Behavior Examples from the front lines

HealthPrize Startup using multiple behavioral economics levers to improve drug adherence

GymPact Startup using behavioral economics principles (loss aversion, hyperbolic time discounting,

status quo) and mobile technologies to motivate people to exercise regularly

HumanaVitality JV between Humana and Discovery Holdings that uses points, prizes and other gamification levers

to motivate healthy behaviors

“Get Active!” by Aetna Initiative that uses allows employees at a company to form teams aimed at fitness and healthy-

eating goals

FriendFit Website that allows users to share fitness activities on social media sites and motivate each other

Nike+ Products that motivate users with real-time feedback on exercise (e.g., wearable sensors to track

activity levels, integration with smartphone apps)

DailyFeats Motivates users to achieve health-related and other goals through reminders, incentives feedback

from social media friends, etc.

Pfizer/Keas Collaboration on Keas’ platform to develop personalized online care plans for users. Keas’ website

motivates employees with points, badges, and feedback from co-workers.



At

ris

k

Ge

ne

ral

po

pu

lati

on

Dia

gn

os

ed

pa

tie

nt

Tre

atm

en

t

Mo

nit

ori

ng

Re

lap

se

Behaviors Dx Rx Dx Adherence

Molecular

diagnostics,

biomarkers

Targeted

therapeutics

Behavioral

levers

diet, exercise,

smoking, etc.

Real-time

monitoring,

behavioral

levers

Behavioral

levers

adherence

Neutrally-framed

info include

patient

preferences

Personalized medicine Sciences of medicine and behavioural economics



Business models: creative disruption



The business model canvas

Business model canvas

Key

resources

Channels

Cost structure Revenue streams

Key partners Key activities Value

propositions

Customer

relationships

Customer

segments

Deliver value

Capture value

Create value



Creative disruption Apple’s revenues over time



Data-

centric Harnessing and monetizing insights from data

Behaviorally

savvy

Leveraging behavioral economics to succeed in the behavioral

change business

Experience-

focused

Focusing on mass customization and industrial design to

enhance the patient experience

Holistic Encompassing the cycle of care and the lifecycle of the patient

Revenue-flexible Identifying innovative ways of capturing value

Business models for the third place



The ecosystem: aligning for impact



A virtuous circle of innovation



Be the change:

finding the leader within



Start with the right question

You can HAVE it all

You just can’t DO it all

What is IT?



Centered leadership model from McKinsey



Women and power – the challenge for women

The Challenge

► The “Good Girl” problem

► The Goldilocks syndrome

► Embracing ambition

► Finding your purpose

► Using power intentionally



• Declare your purpose

• Claim ambition

Construct your Ten Year Plan

• Networks and Networking

• Personal Brand

• Get digital and own your identity

• Board of Directors

Finding the Courage to Lead



Build Ambition

Ambition

• Critical Experiences

• Knowledge

Recognition Mastery

• Relationships

• Networks



The Ten Year Plan

Your Philosophy and Purpose

Why are you on the planet?

Your Strategy - Ten Year Destination

How will you be known in the world?

Your Tactics - Domains of Mastery – Levels 1 - 10

Your Foundation – Friends, Family and Faith



Networks are the Engine of the 21rst Century



Get digital!



Power

Position

Persona

Purpose

Passion

Platform

Building Your Personal Brand



Build Your Own Virtual Company

► Sponsors

► Mentors

► Strategic Alliances

► Key Opinion Leaders

► Followers

► Board of Directors



Connecting the Dots: Winning at Home, at Work and in the World

Ernst & Young

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