All right, so now let's talk about the global outlook and potentially what the future will potentially will look like. Of course some of this is based on studies that I have done and projection studies. Like you I don't have a crystal ball. And I can't predict the future. I wish I did, but I cannot. Anyway, we will try to see what the industry and market research analysts Think about what potentially is going to happen. Well one of the things we know is patent expiration, that's very simple because once you file a patent you know how much life you're going to have on your patent once it gets approved. And 2016 is going to be a very tough year and that is because a number of patents are going to expired. And number of studies are expecting that the pharma industry is going to loose over $100 billion in sales and these product will go from brand to generic very quickly. And that will have a major impact on the pharma companies. So they are going to have to do something about this and they are to some extent, you will see later on what they are doing. First of all, one other thing that is critically important, this was a study that was done and were done a couple of years ago, is there was a survey of CEOs. One of the section was for pharmaceutical and life science CEOs asking them a number of questions, and this is kind of a summary of that study that showed that about 50% of the pharmaceuticals and life sciences CEOs were wondering about the availability of employees having key skills. That is key, okay, because even though there has been a lot of layoffs, there has been a lot of conservation, there has been a lot of changes of talent moving especially from Europe and the US to Asia for cost containment and other issues. There's still big questions about having people well trained in the pharmaceutical industry that understand the entire process, that understand the difficulties of that industry. There has been also consumerization that has changed whenever you have healthcare. Again, patients are taking care in their own hands rather than believing in the physicians being the ultimate caretaker. They get more informed, they have access to the Internet, they have access to a lot of resources that they did not have before. A number of other things that the CEOs of these pharma biotech companies were worried about, was thinking that, they felt the government should make it a priority to train skilled workforce. And when I talk about government, I'm talking about academic institutions and other institutions that really need to train the workforce. So, basically, there is not a shortage of brain power, if you will. The other thing is that they view this as probably the number one priority for their company. People is what makes the difference in basically having a business that's going to grow. Rather than product themselves, because people are going to create new discovery. Another thing that's kind of interesting is that the healthcare system has changed substantially from product centric to patient and payer centric. So let's talk about this from the standpoint that people are now looking for preventing or curing incurable diseases, rather than just addressing the symptoms of the disease. What are the challenges? The challenges of the business model before, it was that basically the R&D productivity did not improve as much as people hope, even though we have seen in the past couple of years has been an increase in drug approval, which is great, and that is due to the fact that there has been many changes that I'm going to cover right now. In the past the drug discovery process was very linear. It would happen and be conducted in a stepwise manner. It was slow because basically people were looking for the bloc buster, they were looking for the one size fits all, one pill for everyone. They were not taking into consideration genetic profiling. They were not taking into consideration a lot of other proteomic data, microbiome data which now are coming into the play. It was also very inflexible. The FDA and the EMA have made a lot of progress from that perspective. I'll talk a little bit more about that later on. But pharma was also very inflexible. Marketing and drug development didn't talk much together. Marketing didn't talk much with research. That has changed substantially, and we will talk about this. Very expensive when you have your clinical trial where you have 5,000 patients that you have to put in your pivotal trial. That becomes very, very pricey. Along the cost that you hear from a lot of the companies, that's 1 billion, 2 billion, 3 billion, whatever the number is. A lot of these cost include product failure, and also I want us to be very careful about these costs, which I know lobbyist love to bring out, well, our drug cost 3 billion to develop. Well if you are developing a drug for 100, patients It's not going to cost you 3 billion. Now, if you're developing a drug for a 100 million patient, then maybe but that's another issue. And then the other thing that was really critical during those time is that the R&D process was highly fragmented, there was no, not as much multifunctional teams. People fail to learn from their experiences. They will not share data which is changing substantially. Now key trends are emerging that is putting a huge amount of pressure that are changing. There are market trends and I talked about some of those, patients becoming better informed emerging market becoming more important. There are healthcare trends where if you burden of the bill to be paid by chronic disease is soaring and being paid by the patients. There are financial constraints on payers that are increasing. Pay for performance is on the rise versus than just well, gee, we'll pay for anything. And then scientific and technical trends where the R&D is becoming more virtualized. We will talk about that as well, how basically there is networks discovery. There is remote monitoring that is improving rapidity of drug development. So the business models have to change from that standpoint. And they are now a lot more open based on collaborations. We will talk about the holistic model in a minute. Pharma will need to go beyond the medicine. They are looking to be paid for outcome, not products. Is the patient out of the hospital quicker? Is the patient basically doing better long-term, rather than having to come back Into the clinic? They are going to have to adopt to more flexible pricing strategies. R&D is going to have to go beyond the lab. I mean, they are going to have to think about both diagnostics, biomarkers and then monitoring of the disease. They are going to have to look at virtualizing R&D, potentially, working with the networks, working with academia, working with biotech companies, working with network centers. They also are going to have to demonstrate real value for the money, and that's really important from that standpoint in terms of comparative trials are going to become the norm, rather than the exception. It's going to have also to be a lot more ethnicity dependent because we are not the same. So, it's going to have to be personalized and you have heard the term many, many time. We'll talk about personalized medicine later on. In addition to that, the value chain is going to become more intertwined where pharmaceutical company are going to have to work more closely with the regulators which they're already doing. But also with the payers and the insurance companies and the patients. Really finding out what do people really want at the end of the day? Rather than saying, well gee, our only customers are the physicians and As long as the physician prescribe, it then everything will be fine. Well that's not the case anymore. So the new drug development paradigm that a lot of companies are already doing, and many more companies are going through that is kind of the holistic approach. From the perspective that it's iterative, it's fast, it's adaptive, it's cost efficient, it's open, it's using big data. It's really learning as we go in real time, especially with getting real time data as your clinical trial is going along. It's really open across both the different departments within a pharmaceutical or biotech company, but also open with partners. So there's more transparencies. Trying to learn from the mistakes from one company to the other I think is very important and then networked throughout the entire process. To really be looking at it more from the partnering standpoint, rather than this silo NIH syndrome, which doesn't stand for The National Institute of Health, but more like for the Not Invented Here syndrome. I think that people have to go beyond that thinking and beyond that, basically, blinder thinking into saying well, we need to really learn and be better at our jobs. Now all this, of course, has to be done carefully because you want to protect intellectual property because without intellectual property, you don't have innovation. And you don't have novel drugs being launched because you can't make money out of it. And at the end of the day, we have to remember that this is a business and people need to make some money in order to continue to operate. The other thing that's important is the value of change and we will talk about this later on on the commercial side where a patient now becomes the center for really both pharmaceutical companies but also for the payers, for the physicians. Really trying to make it such with personalized medicine using big data, using really healthcare data and working together in synchrony throughout all of these different entities if you will to make sure that the product that's going to be delivered at the end of the day to take care of the patient from being a drug, being a biomarketer, being a diagnostics, being a monitoring tool, is really going to deliver a value. So it becomes really complex and that's where informatics becomes important, that's where the intra-connection, inter-connection becomes important as well. But again the patient is really what it's all about at the end of the day.
