Is data the new oil?
The Evening Standard recently asked, “Is data the new oil?” In the story, the author points to the fact that new businesses in many sectors are now born of data available to entrepreneurs in every sector. Market research firm IDC recently reported that the amount of personal data that the tech giants like Amazon, Facebook and Google will harvest is predicted to reach 180 zettabytes — 180 followed by 21 zeros — in just a few years’ time.
So, how can life sciences companies take advantage of this oil rich data field? Much of the data life sciences companies generate eventually makes its way into the public domain. Clincial trial data is published on clinicaltrials.gov and financial payments made to health care providers (HCPs) and health care organizations (HCOs) is submitted annually to the Centers for Medicare & Medicaid Services (CMS) at openpaymentsdata.cms.gov.
“The life sciences industry is one of the most heavily regulated industries. Globally life sciences manufacturers have been forced into data collection, analysis and reporting of its interactions with HCPs and HCOs as a result of global transparency laws and regulations.”
Data collection and privacy
Data collection and privacy concerns are top of mind for life sciences CEOs as the European Union’s (EU) General Data Protection Regulation (GDPR) Regulation (EU) 2016/679 enforcement begins on May 25, 2018. The European Parliament, Council of the European Union and the European Commission intend to strengthen and unify data protection for all individuals within the European Union (EU) with the adoption of this regulation. It also addresses the export of personal data outside the EU. The GDPR aims primarily to give control back to EU citizens and residents over their personal data and to simplify the regulatory environment for international business by unifying the regulation within the EU.
When the GDPR takes effect, it will replace the current data protection directive (officially Directive 95/46/EC) of 1995. It becomes enforceable on May 25, 2018 after a two-year transition period and, unlike a directive, it does not require national governments to pass any enabling legislation, and is thus directly binding and applicable.
As a result of the transparency and data privacy regulations, all life science companies must evolve their IT enterprises and business processes to comply. As a result, data collection from all sectors of the business should be aggregated and securly stored. So, what does this mean for life sciences business stakeholders? How will these new laws and directives change the way life sciences companies operate?
IT and business impact
Life sciences CEO’s and the line-of-business (LOB) executives’ priority lists will include data management and digital transformation inititiaves that transcend the entire business. Global transparency laws are forcing companies to replace outdated and homegrown IT solutions and modernize with SaaS cloud solutions.
“In order to comply with these laws life sciences companies must aggregate and track interactions with and payments made to HCPs and HCOs. This will force a data transformation (DX) of business processes for life sciences companies.”
ICT recently predicted that digital transformation will drive an increasingly large portion of ICT budgets. By the end of 2019, digital transformation spending is expected to reach $1.7 trillion worldwide, a 42% increase from 2017. ICT recommends that companies work to make significant progress in transforming the IT organization and its technology infrastructure, processes and skills to a “digital-native model over the next three years.
The ICT stated, “The time frame for transforming the IT organization to support enterprise data transformations goals is shorter than many executives realize.”
In Part II we discuss the benefits of data analytics and the transformation that will take place in the next few years.