The Rise of Patient Centricity in the Pharmaceutical Industry

Abstract

Despite a decade of public and private efforts to promote patient centricity in healthcare, there is still considerable ambiguity and skepticism regarding the concept and its business impact in the pharmaceutical industry. In this research, a novel methodology is developed to quantify firms’ strategic orientation using public 10-K reports. The Strategic Orientation Ratio (SOR) was developed and first validated to examine customer centricity for 9 non-pharmaceutical companies. The SOR is then extended from customer centricity to patient centricity, and it was applied to measure the extent of patient centricity in 10 multinational pharmaceutical firms. The method was successfully validated by identifying the strategic orientation of non-pharma firms such as Walmart, Apple, and Amazon. Next, by the same method, the extent of patient centricity is quantified in 10 big pharmaceutical companies for 2005-2015. This revealed the extent to which patient centricity exists in pharmaceutical companies, and how this has changed over time. The combination of an expressed patient-centric strategic orientation, personalized medicine (measured by oncology products), and patient access (measured by sales) is shown empirically to have a significant positive effect on firm performance. This implies that not only is patient centricity “the right thing to do,” it can also be a viable model for pharmaceutical firm competitiveness.