Happy New Year
The new year has arrived. Of course, there is no miraculous step-change associated with going from one year to another, but still, the world had in most instances been dreading to leave 2020 behind and move on … The start of a new year in healthcare has over the past decades been characterized by back-to-back meetings spread across hotel rooms in San Francisco where the industry’s annual gathering had taken place, not to say had been celebrated. Nobody knows if or when we will return to holding physical meetings. What the pandemic has shown us all is that a lot of time can be saved when interacting virtually: there is a large number of 30-minute slots that fit into the duration of a transatlantic flight. Whilst still getting the job done: calendars are packed with productive sessions and the virtual nature of 2021’s “conference week” allows it to span the entire week, with interactions starting early mornings in any executive’s time zone and extending until late into the night. No receptions or gatherings in between to unwind though, but, as a recent Fierce Biotech article puts it, “No one missed running up and down the hills of San Francisco during the annual monsoon.”
In particular the re-spreading of activities away from a single week into several pre and post the “real” week, provides for less crammed atmosphere and overall possibly better execution. The JPM Conference had long attracted a number of other events to take place same week same location, in order to maximize connectivity and avoid multiple travels. Now, it is obvious such collocation is partly being unwound. In parallel, the discussion of why JPM needed to take place in San Francisco continues.
Ultimately, web meetings cannot be a full substitute for in-person interaction in particular for those who like to engage with others. But companies get financed, studies get executed, and deals get done with minimal in-person interaction.
After two weeks in 2021 we know the industry is stronger than ever. A few companies had to hold back on commercial aspects of their business in 2020 (a bad year to launch, for example); which undoubtedly continue rippling on. But for many R&D organizations it was busines as usual (after some initial adjustments and aside challenges for trials, the full impact of which is still under debate) and the pipeline of innovation that is looking to be financed remains unbroken.
Per Friday, clearly lacking are the M&A announcements of global players that we used to witness during prior JPM weeks. Sanofi’s $1.1bn Kymab acquisition finds itself as a relatively lonesome story in the virtual papers, possibly only finding company in Novartis’ in-licensing of BeiGene’s tislelizumab and Boehringer’s dark antigens collaboration with Enara – and outside pharma of course there is Steris’ acquisition of Cantel for $4.6bn. A much larger number of public equity financings got announced since the beginning of the year with ~$3.2bn proceeds, with disclosed private rounds ranking just a bit lower on total proceeds of ~$2.2bn.
Looking at it closely, the share of news coverage allocated to the virtuality of event and a possible future location for the physical meeting, versus deal making news, may instill some concern. However, we also heard encouraging clinical and preclinical news stories as well as reports of new cross sector alliances (reference the Biogen Apple collaboration on cognitive decline) which on balance leave the overall impression as a highly promising one.
Virtual reality will remain at the center of our lives during 2021. And will reach areas where just a few years ago there were -and often still today are- some dusty practices commonly accepted, starting from manual patient diaries in clinical trials that get transcribed by a nurse to get faxed (or scanned, wow) to a CRO, and not ending at due diligence and deal making where you can now have extended conversations and fold various experts into a dialogue without having to fly them around the globe. And it is so much easier to meet once more on a given topic if we do not need to take a plane to make it happen.
Most people working in the healthcare sector are relieved to have made a career choice of not going into commercial real estate – an industry that will require significant reinvention ability as various leading companies including pharma and medtech are considering downsizing their representative premises by 20, 30 or 40 percent and some investors even continue prohibiting employees to return to the office for an undefine timeframe.
For companies that were not set up virtually before, it suddenly enables access to a much more geographically diverse talent pool – whilst allowing employees to choose their location of living almost detached from their choice for an employer. And agreement is high amongst executives that “working from everywhere” triggers creativity and innovation, in particular if it frees up time (e.g. travel) while avoids overwhelming staff.
Of course there are downsides to virtuality which have affected and will continue affecting the industry. Companies in particular in the middle market who put out timeline targets at last year’s JPM, can in instances be found today looking back on a year of clinical development where data sets are showing missing patient visits – very often due to Covid-19 – to an extent the studies are rendered futile. Other trials were not even started.
Would it have been better to halt all ongoing clinical development? There will always be debate with hindsight, there will always be the question whether operational issues could have been avoided. But, in the context of a global pandemic with ripple-on effects across every aspect of the lives of everybody involved, the industry as a whole has remained highly productive. Which it would not have been, had it not been driven by its members entrepreneurship and strive to move things forward.
Voices at this year’s JPM conference pointed out that the attention which Covid-19 drew to infectious diseases and the need to be prepared for the unforeseen, did not however provide much support for the long lagging development of novel antibiotics, a field that still suffers from low commercial attractiveness that translates back up the value chain into low innovation and where last year’s $1bn creation of AMR Action Fund appears like a drop in an ocean.
Heading into the months to come, not only the WHO Regional Office for Europe advocates to apply strict caution such that any optimism does not undermine humanity’s chances to leave the pandemic behind. While 230 million European citizens are living in countries under full national lockdown, transmission across the globe has remained at very high rates of infection, and new variants of the virus have and will develop which render the future to remain uncertain. It will, for sure, provide for ample opportunities to work together across sub verticals of healthcare to drive innovation towards patients.