As vaccine programs get underway around the world, there is a glimmer of hope that we might be nearing the end of the global disruption caused by the pandemic, but the risk landscape for life science companies may have changed forever.
Lockdowns across the world triggered organizations to re-evaluate their supply chains and prompted consumers to turn to digital healthcare solutions.
As technological innovation infiltrates every element of modern life, the boundaries between the life science and technology sectors are blurring, leaving insurance markets playing catch-up.
In this whitepaper we explore the following emerging trends impacting life science companies in more detail:
When COVID-19 forced China to close its borders for exports, many life science organizations were faced by the risk that their supply chains might be cut off at source.
When COVID-19 forced China to close its borders for exports, many life science organizations were faced by the risk that their supply chains might be cut off at source.”Neil Emerson | GB Practice Leader – Life Sciences, WTW
This served as a warning to not be over-reliant on a single region and has seen organizations evaluating options to reinvest locally, in some cases encouraged by government, and avoid reliance on a single geography.
We’ve even seen disruption once lockdowns have been lifted, either due to backlogs, or because of local shutdowns.
For example, we saw a case of a drug not being authorized despite being ready for approval because local inspections of the manufacturing site were not able to be carried out.
When the pandemic hit, many organizations from different industry sectors engaged in the fight against COVID-19. Governments around the world actively encouraged and incentivized businesses to help.
For example, engineering companies quickly adapted their manufacturing processes in order to make ventilators and personal protective equipment (PPE).
Emergency Use Authorizations (EUAs) have been put in place in jurisdictions around the world to allow organizations temporary approval, fast-tracking the authorization processes, for manufacturing PPE and ventilators, and for researching and testing vaccines and treatments.1
Many governments are currently shouldering the risks involved with emergency production and have indemnified manufacturers against product liability claims.
As hospitals around the world channeled all their resources into dealing with rising numbers of COVID-19 cases, millions of patients experienced treatment delays and some drug manufacturers postponed clinical trials.
Predictive modelling suggests:
The move towards digital health and the rise in personal health services has been growing over the last decade. However, the need for virtual health services during the pandemic has given these areas a boost and pushed the industry forward more quickly than it might have otherwise done.
Users were quick to adapt to digital health options, such as virtual GP appointments, mental health apps and apps designed to contain and manage the spread of COVID-19.
As technology becomes an ever-increasing part of healthcare, traditional boundaries break down. For example, previous distinctions between whether a business’s activities are in tech or in health are now blurred.
This breakdown of siloes does present opportunities to provide better services for patients and improve outcomes, but it also changes established risk landscapes.4
Cell and gene therapies promise to be the future of medicine, but it’s still early days.”Neil Emerson
GB Practice Leader – Life Sciences, WTW
Cell and gene therapies promise to be the future of medicine, but it’s still early days.
Many of the technologies used are brand new and have long development times. However, the pace of development is picking up due mainly to considerable advances in viral vector technologies used to deliver the genetic material.
The FDA expects an approval rate of the word up to 20 novel cell or gene therapies every year by 2025.5
Cancer is the most common human genetic disease and it’s here, in addition to cardiovascular and neurodegenerative diseases, where cell and gene therapy is likely to become first-line treatment and promises tremendous positive impacts on the lives of patients.
As the COVID-19 pandemic enters its second year, and vaccines begin to be deployed across the world, we expect repercussions of COVID-19 will continue to be felt for some time.
The sector has faced challenges, particularly in supply chain management and in the regulation of medical devices produced to help tackle the virus.
However, we’ve also seen some areas of the sector receive a boost as the world moved online and the global crisis demanded innovative solutions.
Markets are adapting to the changing risk climate and businesses must ensure that changes in the way they operate are reflected in their insurance arrangements.
To find out more about how Willis Towers Watson can help your business manage its risks during these uncertain times, please do not hesitate to contact me.