In the fiercely competitive landscape of the pharma and biotech industries, standing out from the crowd is crucial for success. One strategy that has gained traction in recent years is the Blue Ocean Strategy. By charting new waters and creating uncontested market spaces, companies can differentiate themselves and unlock unprecedented growth opportunities. In this blog post, I’ll explore how pharma / biotech companies can leverage the blue ocean and red ocean strategy to make waves in the market.
What is Blue Ocean Strategy
The blue ocean strategy, conceptualized by W Chan Kim and Renée Mauborgne in their groundbreaking book Blue Ocean Strategy, is akin to venturing into uncharted territories of the ocean. It’s about carving out new market spaces that remain uncontested by rivals, in contrast to the violent competition found in the existing market (red ocean). The strategy involves creating an entirely new demand for products or services, transcending the constraints of existing demand. By doing so, companies can set themselves apart from their competitors and present a compelling value proposition to their customers.
Red and Blue Ocean Strategy in Pharma / Biotech
We can consider pharma / biotech industry as a vast expanse, where companies either navigate in a sea of sameness (red ocean) or pioneer their course in waters unexplored (blue ocean). While the former involves intense rivalry, limited innovation, and constant price wars, the latter represents a realm where innovation has no bounds, competition is irrelevant, and value creation is paramount. This strategy is not a silver bullet; it’s a calculated voyage into uncharted waters. The integration of the blue ocean strategy in healthcare landscape, often known as blue ocean therapy, and its application in medical product development, such as blue ocean medical products, is the silver lining that can revolutionize the industry.
Below, I have pasted a table illustrating the difference between red ocean and blue ocean strategy.
How Can Pharma / Biotech Companies Use Blue Red Ocean Strategy?
Pharma / biotech companies can use the blue ocean strategy or red sea blue sea strategy to differentiate themselves from their competitors and create a unique value proposition for their customers. Below, I’ve mentioned some of the areas, along with prominent examples, wherein, pharma / biotech companies can implement red ocean and blue ocean strategy.
Digital therapeutics is an emerging field in the pharmaceutical industry that focuses on using digital technology to manage disease symptoms. This technology presents an opportunity to improve the lives of many patients and improve a treatment’s efficacy.
Blue Ocean Strategy Example: Pear Therapeutics has developed a digital therapeutic called reSET, which is used to treat substance use disorder.
Real World Data and Blue Ocean Strategy
Real-world data is particularly useful for researchers, as it provides valuable insights from patient data and knowledge that can impact many decision-making processes. By using real-world evidence, researchers can gain clinically useful insights that can help improve the quality of care delivery in precision medicine.
Blue Ocean Strategy Example: Flatiron Health has developed a platform that collects and analyzes real-world data from cancer patients to help improve cancer care. The platform utilizes electronic health records (EHRs) to generate real-world datasets that can be used to identify outcomes for those typically underrepresented or not represented in clinical trials.
Streamlining Supply Chain Management
The digital field is making a relevant move in the pharmaceutical industry in more than one field. Pharmaceutical companies can implement digital platforms to streamline their supply chain management processes.
Blue Ocean Strategy Example: Pfizer has implemented a digital platform called PfizerLink to streamline its supply chain management process.
Increasing personalized medicine and Blue Ocean Strategy
Personalized medicine is a promising approach that holds the potential to revolutionize healthcare by providing tailored treatments that are more effective, safer, and cost-efficient. As the field continues to advance, it is expected to have a profound impact on the future of medicine.
Blue Ocean Strategy Example: Foundation Medicine has developed a genomic profiling test that helps oncologists identify the best treatment options for their patients based on their genetic makeup.
To Deliver More Accurate Data Insights
Accurate data insights can help pharmaceutical companies make better decisions about which drugs to develop and how to market them. In addition to helping pharmaceutical companies make better decisions, accurate data insights can also improve patient outcomes. By analyzing large amounts of data, healthcare providers can identify patterns and trends that may not be immediately apparent, leading to more personalized and effective treatments. Furthermore, accurate data insights can help identify potential safety issues with drugs, allowing pharmaceutical companies to take proactive measures to ensure patient safety.
Blue Ocean Strategy Example: Roche has developed an artificial intelligence platform called NAVIFY that helps oncologists analyze patient data and make more informed treatment decisions.
New Drug Delivery Methods
New drug delivery methods can help improve patient outcomes and reduce side effects, In addition, these methods can also increase patient adherence to medication regimens. By making it easier and more convenient for patients to take their medication, drug delivery systems can help ensure that patients receive the full benefit of their treatment. Furthermore, new drug delivery methods can also help reduce healthcare costs by reducing the need for frequent doctor visits and hospitalizations.
Blue Ocean Strategy Example: AstraZeneca has developed a drug delivery system called Bydureon BCise that allows patients with type 2 diabetes to self-administer their medication once a week.
New Drug Formulations as a Blue Ocean Strategy
New drug formulations can help improve patient adherence and reduce side effects. By altering the formulation of a drug, pharmaceutical companies can improve its bioavailability, stability, and solubility, leading to better absorption and distribution in the body. Furthermore, new drug formulations can also help extend the patent life of a drug, allowing pharmaceutical companies to continue to generate revenue from successful drugs while investing in the development of new treatments.
Blue Ocean Strategy Example: Novartis has developed a new formulation of its drug Gleevec that is easier for patients with gastrointestinal stromal tumors (GIST) to swallow.
New drug combinations as a Blue Ocean Strategy
New drug combinations can help improve patient outcomes and reduce side effects. By combining drugs with different mechanisms of action, pharmaceutical companies can target multiple pathways involved in disease progression, making it more difficult for the disease to develop resistance to treatment. Furthermore, new drug combinations can also help reduce healthcare costs by streamlining treatment regimens and reducing the need for multiple medications.
Blue Ocean Strategy Example: Bristol Myers Squibb has developed a combination therapy called “Opdivo + Yervoy” that is used to treat advanced melanoma.
New indications for existing drugs
New indications for existing drugs can help expand the market for these drugs and increase revenue. In addition, new indications for existing drugs can also help accelerate the drug development process. Since these drugs have already undergone extensive testing and have a known safety profile, obtaining approval for a new indication can be faster and less expensive than developing a new drug from scratch. Furthermore, new indications for existing drugs can also help improve patient outcomes by providing new treatment options for patients with unmet medical needs.
Blue Ocean Strategy Example: Pfizer’s drug Lyrica was originally approved for the treatment of neuropathic pain but was later approved for the treatment of fibromyalgia.
Incorporating Innovative Technologies
By addressing an unmet need in the market and developing a unique value proposition, companies can differentiate themselves from their competitors and create a new market space.
Blue Ocean Strategy Example: Silver Bullet Therapeutics’ new technology for treating bone infections is a game-changer in the medical industry. The technology is not only more effective than existing treatments but also less invasive, providing patients with a safer and more comfortable treatment option.
In conclusion, the pharmaceutical and biotech industry has both red ocean and blue ocean markets, and companies must navigate both to succeed. While red ocean market, such as real-world data and supply chain management are highly competitive, blue ocean market, such as personalized medicine, digital therapeutics, and innovative technologies offer opportunities for innovation and growth. By embracing blue ocean strategies and focusing on differentiation, companies can create new market spaces and achieve long-term success.
The implementation of blue ocean strategy in the pharmaceutical and biotech industry has the potential to revolutionize the way companies approach innovation and growth. By identifying unmet needs and creating new market spaces, companies can differentiate themselves from their competitors and drive growth. As the industry continues to evolve, there will be increasing opportunities for companies to implement blue ocean strategies in areas, such as blue ocean therapy, blue ocean medical products, and blue ocean strategy in healthcare. By embracing these opportunities and focusing on innovation, companies can shape the future of healthcare and improve patient outcomes.
Ronit Sharma is an accomplished business research and competitive intelligence professional with over six years of experience in the pharmaceutical and healthcare industry. As a team leader at Roots Analysis, he has authored numerous multidisciplinary market research reports, providing valuable insights into the latest innovations in healthcare and the digital transformation of the pharmaceutical industry. Ronit’s exceptional analytical skills and strategic thinking in the field contribute to the firm’s intellectual capital, empowering clients to make informed decisions in the dynamic pharmaceutical landscape. With a passion for staying at the forefront of industry advancements, Ronit specializes in identifying emerging opportunities for various stakeholders, leveraging his deep understanding of market trends and technological developments. He is committed to fostering an environment of excellence, creativity, and innovation within his team, encouraging collaboration and empowering team members to bring their best ideas to the table.
Ronit holds a B. Tech degree in Biotechnology from Lovely Professional University and his research and thought leadership can be found in his professional blog and social media profiles, where he shares the latest insights and engages in meaningful discussions with industry peers. To ensure the highest ethical standards, Ronit openly declares no conflicts of interest in his work, ensuring unbiased and trustworthy contributions. His insights undergo rigorous editorial and peer-review processes, establishing his credibility as a thought leader within the pharmaceutical and healthcare domain.