UCB: Inspired by Patients. Driven by Science.

Analysis of Ivey Case 9B18E002

Revisiting Business Strategies

UCB is a pharmaceutical company that spends a significant portion of its revenues on research. Consequently, changing the business strategy is essential for the development of new advancements, product development and the discovery of new drugs. In an industry facing digital disruption, deploying data and analytics capabilities to compete became crucial for UCB.

Pressure on pharmaceutical companies by government and payers, to reduce their costs became more important due to the rising economic and demographic stress on the healthcare system. Secondly, the environment is changing with the vast amount of information being constantly created and available online which can be either a threat or an opportunity for pharmaceutical companies depending on how they manage their next move. In addition, radical changes were taking place in the industry and competitors were making use of advanced information technologies.

Lastly, digital technology had already made its way inside businesses providing new possibilities and opportunities in the health care industry. Google Home and Amazon Echo, for instance, can recite lifesaving instructions cardiopulmonary resuscitation — a skill taught to it by American Heart Association [2]. With the changing trend in the industry and to be patient-preferred biopharmaceutical leader, it became necessary to UCB to revisit their business strategies. To succeed in a digital world, the key is to be consistent and systematic in digital transformation. The four factors outlined above are also essential to capture new opportunities that stand up to the reality of the digital world [5]:

1. Customer experience is value: In the digital era, products and services are no longer effective for gaining and retaining customers. Customer experience is vital. Customers need control over a seamless link of the physical and digital worlds. Empathy, deep contextual appreciation, and co-creation are essential factors in achieving that connection.
2. Customers are moving targets: Customer attention in the digital world is short-lived. Brand loyalty is fragile. New mobile and social experiences are introduced at fleeting Internet speed. Customers switching between
   competing value propositions is the rule, rather than the exception. Data and analytics allow companies to successfully staple themselves to their customer’s digital self to stay relevant and appealing.
3. Business ecosystems co-create value: No one organization possesses all the data, digital skills, and capabilities to win over today’s demanding and dynamic digital customer. Therefore, ecosystem competition is the new
   standard. Businesses partner with each other by bringing their respective strengths together to grow the pie, not just split it.
4. Digital platforms boost value co-creation: Your digital innovation strength is limited by your ability to combine your digital assets with those of others. Today’s most valuable and successful business ecosystems are enabled by digital platforms. Carefully managed architectures of reusable digital assets can empower you to capture opportunities faster than your competitors.

Healthcare system has long suffered from constrained resources, increasing demand, and questionable value, yet the future looks more promising due to increasingly sophisticated and widespread uses of data and analytics. Past performance of the healthcare system provides insight as to why change is necessary.

The CEO of UCB Pharmaceuticals, John-Christophe Tellier, introduced a new business strategy reorienting UCB to strive for long term patient value success [9]. As a first step towards the change, UCB adopted a network approach to innovation as an important pillar of its new strategy, expanding and strengthening external connections, combining competitive strengths, and learning co-operatively [1].

Opportunities for Data and Analytics

A report by McKinsey Analytics outlined $300 billion worth of value that analytics could unlock in the US health-care sector alone. To date, only 10 to 20 % of this value has been realized. Some opportunities highlighted were split into five categories: clinical operations, accounting and pricing, R&D, new business models, and public health [4].

The first prospect to use data is to save time searching for databases, old records, and information. Sprints were extended to include value runs followed by A/B testing to validate the new decision more firmly than the old one. Thus, the value of this innovation is that UCB will have the opportunity to improve the research process with more detailed results.

The second perspective is the possibility of in-depth searches among patients’ disease histories. It is essential since the supercomputer, Watson, makes it possible to compare the patient’s symptoms with millions similar
in the database. Thus, the value of the innovation is that the search for the necessary information in the database
becomes fast and accurate.

The opportunities for UCB to make use of analytics are many folds — from analyzing patient demographics and medical histories to optimizing drug launches, through to identifying physician behaviour and establishing their
likelihood to adopt new drugs [7]. UCB can use data in the following major ways:

1. Targeted Marketing and Sales: Previously pharmaceutical companies would send their reps on lengthy doctors’ visits and invest in expensive, broad-scale product promotion. Around 25% of their pharmaceutical marketing is delivered over a digital platform; 87% intend to increase their use of analytics to target spending and drive improved ROI [8]. Some of that money is likely to go into monitoring doctors’ therapeutic tastes, geographic trends, peak prescription rates — anything that has direct relevance to the sales cycle. This data then feeds into:
   • Predictive Analytics: Drug companies are employing predictive methods to determine which consumers and physicians are most likely to utilize a drug and create more targeted on-the-ground marketing efforts. They
   are right to do so considering the vast new advantages analytics has opened up, which can prove beneficial for both the patients as well as the business [6].
   • Sophisticated Sales: Pharmaceuticals are providing drug reps with mobile devices and real-time analytics on their prospects. Reps can then tailor their agenda to suit the physician. The sales team can then analyze the results to determine whether the approach was effective.
2. Better Patient Follow-Ups: With the development of miniature biosensors, sophisticated at-home devices, smart pills and bottles, smartphones and health apps, monitoring a patient’s health has never been easier. Pharmaceutical companies are increasingly interested in how the real-time data from these tools can be used to support R&D, analyze the efficacy and increase drug sales. In addition to knowing how their drugs are being used, UCB also wants to know how customers view their products. Opinions about new drugs are often generated through patient-physician and patient-patient experiences in a way that creates messy, unstructured data sets, that can today be extracted with tools such as Natural Language Processing. Understanding how patients use drugs, pharmaceutical
   companies can get more insight into the perception of their products and get valuable information positive or negative as to why a patient would stop their prescription. However, if properly organized and analyzed, this data can be a rich trove of information on:

• Patterns in drug-drug interactions
• What drives patients to stop taking medications
• Which patients will not stick to their prescriptions

Shanghai, March 2006

The CEO of UCB, John-Christophe Tellier, established a strategic priority to focus on digitalization from 2015, an essential step towards success in strategic planning [9]. UCB’s executive meeting in Shanghai in March 2016 was pivotal for UCB, as De Prins made a statement about reaching a new peak in the company’s digital transformation. The Shanghai meeting was an opportunity for empowering the organization and to create awareness for the need to embrace analytics. This holds true as all the employees of UCB rethought the value of the patient and the importance of introducing new systems into the activities of UCB. Demonstrating the value of analytics on an
ongoing basis is part of building organizational support. Nevertheless, the challenges De Prins faced was a matter of allocating control, ensuring the right course of development and direction of resources. Even though the sprinters were successful, people within UCB were still not ready to commit.

The sprints projects and A/B testing showed that capabilities and possibilities are here, and it was time to harvest their intrinsic values. People today tech-savvy they need to be analytic savvy; analytic should transcend the IT department and be part of one and other. Working cross-silo with data will be beneficial in the long run. The advanced analytics team also returned to the AaaS vision: in addition to producing solutions for particular business cases, it used value runs to create data products [1]. De Prins took the opportunity to reflect on these at Shanghai and showcased that digitalization is already here, but the challenge was to efficiently leverage it. He commended the achievements of Lieutenant and his team. The challenges are more into an ethic and conceptual framework. Without proper direction, guidelines and directives, the effort and resources can diffuse and lose their impact. It requires coordination.

Agendas and Proposals

The agenda and proposals for the executive meeting should be the question of the distribution of the budget, to be updated with the constantly growing technology and the practical implementation of the use of data. Lieutenant’s
decision on being opportunistic and gathering relevant data as opposed to creating a data warehouse with all the data will help narrow down the resources (medical staff, technical tools, IT professionals, lease etc) required which will in turn help to create a more defined budget. New advancements in technology demand UCB to be updated with the knowledge and use the newly available tools. For this change to occur, new company policies, tools and talent have to be put in place. If the current technology has room to be onboard the new technology, it will be helpful in the transition. This way, by through digital transformation and adopting new technologies, the true potential of the data and all the insights that it holds can be unravelled. Not
only can there be medical advancements but technical advancements too.

References
[1] Viaene, S. (2018). UCB: Data is the New Drug. Ivey Publishing.
Retrieved from https://www.iveycases.com/ProductView.aspx?id=91054

[2] “A Digital Revolution in Health Care Is Speeding Up,” The Economist, March 2, 2017, accessed January 5, 2018, https://www.economist.com/news/business/2 171 7990-telemedicine-predictive- diagnostics-wearable-sensors-and-host-new-apps-will-transform-how.

[3] Thomas Davenport and Jeanne Harris, “What Makes an Analytical Competitor?” in Competing on Analytics:
The New Science of Winning, 2nd ed. (Boston, MA: Harvard Business Review Press, 2017).

[4] Nicolaus Henke, Jacques Bughin, Michael Chui, James Manyika, Tamim Saleh, Bill Wiseman, and GLiru Sethupathy, “Opportunities Still Uncaptured,” in The Age of Analytics: Competing in a Data — Driven World, McKinsey Global Institute, December 2016, accessed January 5, 2018, www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/the-age-of-analytics-competing-in-a-data-driven-world

[5] Stijn Viaene, “A Digital Quick-Start Guide,” Ivey Business Journal, September — October 2017. Received from Ivey Publishing, Product number: 9B17TE04

[6] Predictive analytics in health care. (n.d.). Retrieved from
https://www2.deloitte.com/us/en/insights/topics/analytics/predictive-analytics-health-care-value-risks.html.

[7] Winning with analytics in the pharmaceutical industry. (2018, June 15). Retrieved from https://www.information-age.com/winning-analytics-pharmaceutical-industry-123465730/.

[8] Life in the New Normal: The Customer Engagement Revolution. (n.d.). Accenture Life Science. Retrieved from https://www.accenture.com/t20150523t060659__w__/us-en/_acnmedia/accenture/conversion-
assets/microsites/documents2/accenture-life-in-the-normal-the-customer-engagement-revolution.pdf

[9] Widjaya, I., Raia, M., & Shealy, M. (2016, July 27). 7 Reasons Why Strategic Planning is Essential for Business Success. Retrieved from https://www.noobpreneur.com/2016/07/27/7-reasons-why-strategic-planning-is-essential- for-business-success/.