Proving the Business Case for the Internet of Things

World's top drugmaker Novartis takes aim at tech

Ben Hirschler
November 19, 2014

(Reuters) - Talent spotters from Novartis AG, charged with bringing new ideas into the organization, are casting their net beyond biotech into the wider pool of wearable, or even edible, technology.

It's not that the world's biggest drugmaker by sales wants to make the next smart watch. Rather, its researchers are seeking fresh ways to monitor exactly how the company's medicines are working and being taken by patients.

Chief Executive Joe Jimenez predicts this will be an integral part of running a big pharmaceutical company in the coming decade, as rising healthcare demand coupled with limited budgets force drugmakers to generate hard data to prove their drugs are delivering results.

The Swiss group has already taken tentative steps, signing a deal with Google Inc (Mountain View, CA, USA) in July to develop contact lenses to help diabetics track blood glucose levels or restore the eye's ability to focus.

It also has an agreement with privately held Proteus Digital Health to develop tablets containing embedded microchips that can tell if patients have taken their medication.

Its ambitions, however, stretch a lot further.

"We've done more than most but certainly not enough. You're going to see a continued focus from this company that will be quite technology agnostic," Jimenez said in an interview during an FT pharmaceutical conference in London.

"It may be niche today but in the future I think it is going to be front and center as to how diseases are managed."


The interest comes at a time when technology companies are increasingly pushing from the other direction in an effort to find new ways for patients to monitor their own health and track chronic conditions using smart devices.

Businesses such as Apple Inc (Cupertino, CA, USA), Samsung Electronics Co Ltd (Seoul, South Korea) and Google are all trying to find health-related applications for their wearable products.

While drugmakers are certainly not short of demand for their medicines, as populations get older and sicker, finding the money to pay for costly new interventions is another matter.

Clashes between governments and drugmakers over pricing are becoming more common - most notably in cancer and hepatitis C treatment - and the industry acknowledges a need to move to a system of payment based on clinical outcomes, rather than a price per pill.

Jimenez is convinced remote monitoring technology will play a central role in this respect, both to help healthcare systems check if patients are improving and also to protect companies that need to ensure they are not penalized for a drug failing if a patient does not take his or her medicine.

The approach has potential to work well for a company like Novartis (Basel, Switzerland), which hopes to launch a new drug for the debilitating condition of heart failure next year.

"If there were a wearable device that could help the patient and their physician understand whether or not to come to the hospitals then that, together with our drug, could be a very potent combination," Jimenez said.

"It doesn't mean we will own the technologies, but it does mean the technologies will play an important role in the management of disease."

(Editing by David Holmes)
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