Heavy! Ten key points of the medical industry in 2016
For medical consumers, 2016 will be a year of freshness as different medical organizations and innovative tools and services enter the new healthcare economy. PwC's Medical Research Institute (HRI), in its newly released annual “Key Issues in the Healthcare Industry †report, predicts the ten most influential forces in the healthcare industry in 2016. The author has extracted the main content of the report, as detailed below.
One of the key points: the merger boom
In 2016, the high-profile M&A boom is likely to continue, and the focus will still be on insurance companies as it will ensure that regulators believe that industry consolidation will benefit consumers.
Insurers are actively pursuing competitive advantages, such as diversified revenue streams from new products, IT infrastructure, and optimization of powerful data analytics capabilities. The most striking thing in the second half of 2015 was the merger between insurance companies. If the deal passes the relevant regulatory review, the three giants of the insurance industry will occupy the entire insurance market in 2017. If these large merger plans are approved, it may further stimulate the chain reaction of mergers and acquisitions, which will affect the entire industry.
Although the insurance company will be the protagonist of the M&A boom in the next year, the M&A activity of the entire medical industry also shows an upward trend. More and more independent hospitals and clinics will find it difficult to continue on their own. In order to capture the existing customer base of the above organizations, large medical management companies are acquiring medical institutions that complement themselves.
In response to the trend from individual patients to population health management, health care providers have also focused on enhancing their branding. In the wave of mergers and acquisitions, brands may be the key to attracting consumers. According to the HRI survey, 86% of consumers said that it is very important to have a brand that is “best in the field†when choosing a medical system. In order to obtain the “best in class†medical service, 46% of respondents are willing to go further; 33% are willing to wait longer; 19% are willing to pay more money. see picture 1. Health care providers should wisely choose the development strategy that suits them, such as working with top-level healthcare systems like the Mayo Clinic Care Network. The network has signed cooperation agreements with local hospitals in 20 states across the United States, and this form of cooperation can be used as an alternative to traditional acquisitions.
The pharmaceutical and life sciences are also experiencing a wave of active trading activities. Pharmaceutical companies are looking for products and services that go beyond traditional mergers and acquisitions to strengthen their portfolios and drug channels. To improve medication adherence, Teva Pharmaceuticals recently acquired Gecko Health Innovations, a software development company for respiratory disease management. In pursuit of a robust channel and expansion of its current channels, pharmaceutical companies are willing to pay huge sums of money for promising products and services.
As of mid-2015, the transaction volume of the medical industry has broken the record in 2014. The published M&A agreement has a market value of nearly 400 billion US dollars, which also makes people expect high expectations for the next 2016. Due to industry consolidation, there are fewer and fewer participants in the market, and the pressure to pursue differentiation is growing. Only those companies that cater to the needs of consumers and provide them with more access, better efficacy and lower costs can compete for success.
The second key point: drug prices
The price of medicines in the United States has reached the boiling point. Insurance companies, patients and politicians think it is too high. At the same time, the pharmaceutical industry's focus is on the balance between the pressure of further price cuts and the financing of innovation, that is, how to "just right" pricing. Under the pressure of strong government policies in 2016, pharmaceutical companies are considering new ways to get people to agree on drug prices, that is, collaboration with insurance companies, patients, and new value assessment agencies.
Many factors have contributed to this price increase. In 2014, specialist drug spending increased by nearly 27%; since 2006, the increase in branded drug prices has consistently exceeded the inflation rate. Even the generic drugs, which are usually tight in price, have increased in price in 2014, reaching an average of nearly 9%. In 2016, with the launch of many new specialty drugs with a development cost of more than $100,000 and an increase in market share, the trend of rising drug prices is expected to continue.
Value is becoming more and more important in drug pricing decisions. Leonard Schleifer, CEO of Regeneron Pharmaceuticals, criticized some industry giants for significantly increasing their drug prices after acquiring a company; he believes that the promotion of payment formulas should be promoted to reward those who have successfully developed new treatments.
The drug price review also includes third-party non-profit value assessment groups such as the Clinical and Economic Observation Institute (ICER), the National Comprehensive Cancer Network, and the American Society of Clinical Oncology. These third-party organizations are developing drug price formulas based on clinical efficacy, economic impact, comparative benefit, and drug toxicity. A similar approach has been used in related institutions in the UK, Germany and other countries for many years and has successfully reduced drug prices. US insurers, which are facing increasing pressure on drug prices, may use the data to negotiate prices to seek to limit or delay costs.
And when consumers are caught in the middle, they often feel that it is difficult to buy medicine. According to the 2015 HRI consumer survey report, Money and Money, 17% of American adults will ask their doctors to prescribe cheaper prescriptions. Because of the ubiquity of high-deductible health insurance plans in the new medical economy, consumers may increase their drug prices. On the other hand, more than half (53%) of consumers prefer to purchase drugs in installments instead of paying off in a lump sum (17%). See Figure 2.
As prices have risen, politicians have begun to pay attention to drug prices. Some 2016 presidential candidates have issued plans for drug prices and out-of-pocket payments, and governments such as California, Massachusetts, and New York are considering issuing their own legislation. Legislators' concerns have brought the dawn of future drug prices based on cost rather than value.
Hardware Locks,Stainless Steel Plane Locks,Flat Locks,Plane Locks
Ningbo Hengchieh Locking Technology Co., Ltd. , https://www.hengchieh.com