Pharma Reform

For years pharmaceutical company executives and managers have argued the need for “critical mass” in virtually every aspect of their business (e.g., larger sales forces, increased marketing “share of voice”, and more R & D resources).  This continues with the recent justification of mega-mergers based on the premise that with healthcare reform, “critical mass” will be essential.

Big banks and financial institutions and the major US automobile manufacturers, with trillions of dollars in assets, a global presence, and thousands of branches and dealerships, for some reason could not muster their “critical mass” to avert financial disaster.  Interestingly, the lack of “critical mass” was not the reason for failure and building “critical mass” was not the solution for fixing any of these organizations.  In fact, for banks, financial institutions, and auto manufacturers it was quite the opposite; downsize and focus.

With such recent examples of “big failures”, and with their own “critical mass” failures including R & D, where tens of thousands of research scientists still find themselves in a drug discovery drought, it is surprising to hear pharmaceutical executives espouse “critical mass” as their solution to a healthcare reformed market.

So, why has “critical mass” let these industries and their companies down? Why might “critical mass” be detrimental to pharmaceutical companies with the advent of healthcare reform?

Over the next several posts we will explore this “critical mass” rationale for growth and expansion and provide a better alternative for pharmaceutical companies looking to succeed in the era of healthcare reform.

mike@pharmareform.com