Uncovering Value Drivers — A 5 to 10 Year Perspective

Building on insights from the scenario-planning exercise, PharmaFutures 2 focused on more immediate trends that would drive value in the pharmaceutical industry over the next five to ten years.

PharmaFutures 2 contracted SustainAbility, the think tank and consultancy to provide project management for the initiative. Like PhamaFutures 1, it centred on two two-day workshops (in October 2006 and March 2007), which brought together the core Working Group of industry executives and investors. In addition, the project drew on interviews with the Working Group and a significant number of senior external experts and commentators on the industry. External research also informed the project.

The first PharmaFutures 2 Workshop examined four core value drivers of the industry: R&D, SG&A, top-line revenue and trust. Discussions focused on current approaches to manage these value drivers and how and whether a focus on the delivery of long-term value would lead to change. It acknowledged the considerable challenges facing executives attempting to balance investor demand to maintain high quarterly returns with the investment needs of an industry with long lead times.

During Workshop 2, pharmaceutical management and investors examined the interplay between market forces and societal expectations and its potential impact on value creation. The Working Group reviewed a spectrum of existing and potential management responses to the changing operating environment and the most likely investor reaction to such decisions. It then reviewed how to improve communication so that decisions which drive long-term value are rewarded.

The project finished with the production and dissemination of a report outlining core recommendations to industry, investors and other stakeholders in the pharma sector.


The industry’s social contract is under severe strain. There is an urgent need for new treatments for antibiotics and diseases like Alzheimer’s. It is in the interest of patients, healthcare providers, industry and pension holders to work together to create the best model for bringing new drugs to market.

Sophia Tickell, Director, PharmaFutures