US Pharmas Will Spend Over $2 Billion On Business Intelligence Solutions By 2006

[March 23, 2004]

US Pharmas Will Spend Over $2 Billion On Business Intelligence Solutions By 2006

A new Gantry Group ROI Value Driver Report, Business Intelligence Solutions for the Pharmaceutical Industry, analyzes the alignment of business intelligence (BI) solutions with industry challenges, examining the underlying ROI value drivers. According to the report BI infrastructure is slowly being deployed throughout the corporate pharma enterprise, integrating and coordinating data from R&D, sales and marketing with critical external data vital to real-time adjustments to resources and priorities. It is estimated that pharmaceutical companies will spend over $2 billion on BI Solutions in the next two years.

�In the post Enron Economy the need for transparency has also impacted the way global pharmaceutical CXO's think about their particular business processes, and continued heightened regulatory environment,� said Malcolm Frank, CEO and President of CXO Systems. �Business Intelligence systems for pharmas have become what ERP was for manufacturers in the late 1980's. HIPPA, drug discovery pipeline, and overall business scorecarding dashboards, are mandatory in the competitive global pharma landscape and reports like this one from Gantry Group is helping them to recognize the need for these solutions.�

Plagued with isolated data silos in disparate formats and disbursed locations, pharmas are realizing that emerging data integration and cross-functional business process monitoring technology is critical to maintain growth, gain market share, and fend off competition. Internal data, including information from product development, territory management systems, sales force automation tools and consumer direct marketing, can be examined across brands rather than within specific product areas. A BI system can enable decision support in real-time by integrating financial operational data with external data sources, such as patient-centric longitudinal data and prescriber data from Pharmacy Benefits Managers, pharmacies, payers and data providers.

Dawna Paton, Gantry Group managing partner and an author of the report, summed up the situation: �Faced with shortened product life-cycles, sky-rocketing costs, diminishing returns from traditional sales channels, and a dramatic re-balancing of prescription decision-making power, pharmas are looking inward for answers. As pharma executives seek ways to manage and maximize the Return on Investment (ROI) of their product portfolio, cross-functional data repositories with BI portals are becoming more accepted as a means to provide real-time views of investments and paybacks, across brands, therapies and customer segments.�

Simultaneous with major changes in market dynamics, the emergence and growth of pharmaceutical informatics is providing pharmas with unprecedented access to detailed information about the sale, prescription, usage and payment for their own products -and those of their competitors. The new availability of this patient-centric data, combined with the need to address the decreased effectiveness of traditional promotions, has made pharmas aware of the need to integrate information coming from both internal and external sources.

�Sophisticated pharmas have figured out that they need a broader population-based view of the context within which their drugs are used. To be truly effective the view must translate over to the sales side, where critical decisions are still based on primary research and extensive analysis of traditional provider-centric prescription data,� said Daniel W. Paterson, Vice President, Marketing & Corporate Development at informatics leader PharMetrics, Inc.

This report examines the underlying value drivers that justify pharmas� investment in and ROI from BI solutions. The report includes:

� Value Drivers that create economic return for pharmas investing in BI solutions

� Examination of how BI solutions favorably impact pharma business processes to improve corporate performance

� Propensity of pharmas to invest in BI solutions

� Top pharma BI solution vendors, comparing approaches, capabilities and ability to deliver value

� Investment Recommendation

An abstract of this latest Gantry ROI Value Driver report is available on the Gantry Group website at: Gantry Group Reports. Ordering information is available by calling Gantry Group at 978-371-7557 or emailing info@gantrygroup.com.

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