Large Pharma Companies To Invest 7% Revenue On Connected, Next-Gen Labs By 2025: Capgemini

Pharma companies are rethinking lab setup and operations, with a focus on accelerating digitalisation, leveraging AI, improving processes, and establishing the proper skills and culture for a lab transformation, a report by Capgemini Research Institute showed.

The need to accelerate cycle times is driving change, with 92% of pharma organisations listing this among the top drivers for future-ready next-gen labs.

The report defined next-gen labs as those that continuously evolve their technology, infrastructure, ways of working, skills and culture.

The top drivers for lab transformation are the need for faster development of innovative drugs, pressure to optimise costs, and improving drug approval rates, the report found. As a result, pharma organisations are looking to create more agile, efficient, collaborative and sustainable labs to help them better address these challenges.

According to the report, large pharma organisations—with $10 billion or more in annual revenue—are planning to almost double their investment in lab transformation by 2025, to up to 7% of their revenue, up from 4% presently. Nearly 75% of pharma organisations have already begun their lab modernisation journey, while others are in the planning stage.

“Backed by technology and continuously evolving in terms of skills, processes and infrastructure, next-gen labs are crucial to accelerate the pace of breakthrough discoveries,” said Thorsten Rall, global life sciences industry lead at Capgemini.

“The opportunity for organisations lies in successfully adopting the latest technologies and developing a robust strategy, with data and AI at its core, to unlock the full potential of their lab transformation,” Rall added.

However, most organisations are yet to advance beyond the pilot and proof-of-concept phase. Only one in 10 organisations surveyed has partially or fully scaled their lab transformation initiatives.

Pharma organisations face key challenges related to data and technology, processes and talent. In addition, developing advanced therapies poses problems as processes become more complex. Most organisations ranked data-related issues (90%) and process complexity (92%) as the main challenges faced by labs.

Next-gen labs require professionals with analytical skills to be able to derive insights from data. But 97% of organisations face the challenge of hiring scientists with a mix of domain as well as digital and data expertise.

The report indicated that “leader” organisations that are spearheading lab transformation efforts are reaping benefits, reporting reduced errors, higher approval rates and optimised costs as compared to “beginners.” Half of leaders have achieved accelerated time to market through lab transformation measures, compared to 23% of beginners.

The report classified “leaders” as organisations that are strong on both “foundations” (such as tools, technologies, data, architecture and connectivity) and “enablers” (such as vision, strategy, people, processes, culture and skills) of lab transformation.

Leaders are also realising sustainability-related benefits, with nearly 36% of these organisations witnessing a reduction in carbon footprint due to lab modernisation initiatives, as compared to only 18% of beginners.