BIOPHARMACEUTICALSWhat the Data Tells Us About Digital Transformation,
by Industry

The key ﬁndings for biopharma companies
Less than 20% of biopharmacompanies have successfully executeda digital transformation (well below
the 35% cross-industry average), andalthough most demonstrateleadership commitment, many fallshort on agile governance, having an
integrated strategy, and eﬀectivelymonitoring progress.

The top ongoing transformation
priorities are evenly divided: digital
ecosystems and partnerships, sales
and marketing acceleration, anddigitizing support functions.

Priorities for the future are digitizingR&D—especially predictive modelingacross R&D activities of discovery anddevelopment—and digitizing supply
chains, with demand forecasting,investment planning, and batch
tracking also seen as important.

Initiatives such as novel delivery
mechanisms, digital therapeutics,
and using digital tools to train sales
reps are more prominent among
successful transformers than in thebroader industry.

ESG is becoming more important,with social initiatives topping thebiopharma agenda.

Employee health and safety andpersonalized training are likely toreceive the most attention, but dataprivacy, cyber resilience, and the useof analytics for emissions reduction
are rising in importance.

Source: BCG analysis.

The data in more depth

Rates of successin digitaltransformation

Source: BCG analysis.

Topics of focus
for biopharmacompanies

Top priorities forthe future

The criticalhuman andtech enablers

The role of ESG
in digitaltransformation

RATES OF SUCCESSThe number of digital transformation winners in biopharma lag thecross-industry average, while biopharma’s worry zone is 1.3 times larger
CASES BELOW SUCCESS SCORE (%)
10080

Biopharma data points
Biopharma60Biopharma sector
average: 7.2

40

Cross-industry

2021 cross-industry
average: 7.4

Woe zone (success score <6)
Worry zone (success score ≥6–<8)

20

Win zone (success score ≥8)

002

4

68

10
SUCCESS SCORE1

2021 BCG Global Digital
Transformation Survey overall

Biopharma sector

13%

52%

35%

15%

65%

19%

Limited value created(<50% of target); no
sustainable change

Value created but total Target value met ortargets not met;
exceeded; sustainable
limited long-term change change created

Source: 2021 BCG Global Digital Transformation Survey.
Note: Survey question: “Across the following dimensions, please rate your organization’s digital transformation experience to date on a scale of 1 to 10, using the guidelines in the table below.”
1Success score is calculated from respondents’ answers on six dimensions of transformation: strategy; leadership; talent; agility; monitoring; and tech and data.

1.3x companies in theworry zone, compared withcross-industry average

RATES OF SUCCESS

Biopharma companies show leadership commitment but struggle with
developing an integrated strategy and an agile governance mindset
DISTRIBUTION OF SUCCESS SCORES ON INDIVIDUAL KEY FACTORS1

1234

56789

106.8

1

Integrated strategy with clear transformation goals

2Leadership commitment from CEO through middle management3

Deployment of high-caliber talent

4An agile governance mindset that drives broader adoption

5

Eﬀective monitoring of progress toward deﬁned outcomes

6Business-led modular technology and data platform

Lower extreme Biopharma average

08.2
6.9
6.3
6.8
7.0

Upper or lower quartile Upper extremeWoe zone (success score <6)

Worry zone (success score ≥6–<8)

Source: 2021 BCG Global Digital Transformation Survey.
Note: Survey question: “Across the following dimensions, please rate your organization’s digital transformation experience to date on a scale of 1 to 10 using the guidelines in the table below.”
1Success score is calculated from respondents’ answers on six dimensions of transformation: strategy; leadership; talent; agility; monitoring; and tech and data.

Win zone (success score ≥8)

TOPICS OF FOCUS

Biopharma companies’ transformation priorities include digital ecosystems andpartnerships, sales and market acceleration, and digitizing support functions
Strategic objectives

Scope of digital transformation1

SHARE OF RESPONDENTS (%)

SHARE OF RESPONDENTS (%)

2827

27

18

Improvement incustomer experienceand go-to-market
Innovation and growthin the core and beyond
Performance improvement
through the operational
value chain
Performance improvementin support functions

Source: BCG Global Digital Transformation Survey, 2021, n = 48.
1
Respondents were asked to select all priorities that applied.

Digital ecosystem and partnerships

79

Sales and market acceleration

77

Digitizing support functions

77

Digital manufacturing and operations

67

Customer experience and journeys

66

Digital procurement

58

Growth and business model innovation

58

Supply chain

54

Building resilience via cybersecurity
and compliance

44Marketing and dynamic pricing

40

New business venture

38

TOP PRIORITIES FOR THE FUTURE

Almost all biopharma companies plan to dedicate about one-fourth of theirspending to digital R&D
PLANNED SHARE OF WALLET SPENDING ALLOCATED ACROSS DIGITAL TOPICS IN THE NEXT TWO TO THREE YEARS (%)196

Digital R&D

2490

Digital supply chain

2077

Next-generation salesand marketing

1992

Digital support functions

1865

Smart factories
Building new business

1056
8Share of respondents allocating any investment toward each digital topic

Average share of total investment

Source: 2021 BCG Global Digital Transformation Survey.
1For example, the uppermost pair of bars can be read as “96% of biopharma respondents plan to invest in digital R&D, allocating an average 24% of total digital investment.”

TOP PRIORITIES FOR THE FUTURE

Biopharma companies’ digital priorities: Digital R&D
Digital initiatives (bars indicate relative prioritization of initiatives)
Predictive modeling of biological processes and drugs

1.00

Digital patient network and registry

0.78

Accelerated trials using patient information

0.74

Digital patient recruitment and e-consent

0.61

In silico target identiﬁcation, drug design, and optimization

0.55

Trial monitoring

0.49

Biometrics for patient identiﬁcation

0.41

Digital companions to improve retention, compliance, and trial outcomes

0.30

Active surveillance capabilities for pharmacovigilance

0.29

New-age drugs (e.g., smart pills)

0.17

AR- and VR-driven labs of the future

0.12
Relative prioritization for all biopharma companies

Source: 2021 BCG Global Digital Transformation Survey, n = 48.

Top priorities for win-zone companies

TOP PRIORITIES FOR THE FUTUREBiopharma companies’ digital priorities: Digital supply chain
Digital initiatives (bars indicate relative prioritization of initiatives)
Demand forecasting

1.00

Dynamic inventory planning

0.69

Real-time product and parts tracking

0.50

Capacity planning

0.49

Real-time supplies tracking

0.32

Automated warehouse

0.19

Real-time inventory tracking

0.13

Route/network optimization

0.11
Relative prioritization for all biopharma companies

Source: 2021 BCG Global Digital Transformation Survey, n = 48.

Top priorities for win-zone companies

TOP PRIORITIES FOR THE FUTURE

Biopharma companies’ digital priorities: Next-generation salesand marketing
Digital initiatives (bars indicate relative prioritization of initiatives)
Customer engagement using digital channels (including social media)

1.00

Multichannel marketing optimization

0.84

Digital stakeholder education (physicians)

0.37

Smart stakeholder segmentation and targeting

0.36

Sales rep education training via digital tools

0.30

Medical rep commissions and incentives optimization

0.23

Pricing/launch sequencing optimization
Smart patient identiﬁcation with ailment symptoms

0.19
0.02

Relative prioritization for all biopharma companies
Source: 2021 BCG Global Digital Transformation Survey, n = 48.

Top priorities for win-zone companies

TOP PRIORITIES FOR THE FUTURE

Biopharma companies’ digital priorities: Digital support functions
Digital initiatives (bars indicate relative prioritization of initiatives)
End-to-end hire-to-retire digitization(including integrated training) for HR

1.00

End-to-end record-to-report digitization of ﬁnance activities

0.92

End-to-end source-to-contract digitization for contracting

0.73

End-to-end procure-to-pay digitization for procurement

0.62

End-to-end order-to-cash digitization for
management of accounts receivable

0.52

Optimization of cash/working capital management

0.30

Forecasting for budget planning

0.30
Relative prioritization for all biopharma companies

Source: 2021 BCG Global Digital Transformation Survey, n = 48.

Top priorities for win-zone companies

TOP PRIORITIES FOR THE FUTURE

Biopharma companies’ digital priorities: Smart factories
Digital initiatives (bars indicate relative prioritization of initiatives)
Manufacturing analytics (production optimization, default detection, etc.)

1.00

Robotics and automation on the assembly line

0.93

Predictive and preventive maintenance for machinery

0.46

Shop-ﬂoor labor-force optimization and schedule/shift management

0.37

Orchestration tower

0.37

Remote AR and VR assistance for troubleshooting

0.30

Shop-ﬂoor simulation

0.27

Energy eﬃciency optimization

0.19

Digital twins

0.18

Wearables for workers’ safety and traceability
Relative prioritization for all biopharma companies
Source: 2021 BCG Global Digital Transformation Survey, n = 48.

0.09
Top priorities for win-zone companies

TOP PRIORITIES FOR THE FUTURE

Biopharma companies’ digital priorities: Building new business
Digital initiatives (bars indicate relative prioritization of initiatives)
New digital products (e.g., IoT-enabled wearables)

1.00

Software-based solution oﬀerings (e.g., patient portals)

0.93

Digital disease management platforms and solutions

Remote-care solutions

0.68

0.33

Relative prioritization for all biopharma companies
Source: 2021 BCG Global Digital Transformation Survey, n = 48.

Top priorities for win-zone companies

THE CRITICAL ENABLERS

Biopharma companies intend to invest across a broad range of tech andhuman enablers
Nine out of ten biopharma companies plan to invest in infrastructure and cloud enablement, AI and big data, cybersecurity, andcontinuous learning, allocating about 55% of total digital enablers spending to these areasPLANNED SHARE OF WALLET SPENDING ALLOCATED ACROSS ENABLER DIGITAL TOPICS IN THE NEXT TWO TO THREE YEARS (%)1Tech100

Human
9692

92

888184

62
13Infrastructureand cloudenablement

9
Modernizationof techarchitecture

16

AI and big data

15

Cybersecurity

54
11
Modernization oftechnology
organization andoperating model

Share of respondents allocating any investment toward digital topic

12

New ways ofworking

11

7
New talent andleadershipmodelsContinuous
learning

Average share of total investment

Source: 2021 BCG Global Digital Transformation Survey, n = 48.
1For example, the leftmost pair of bars can be read as “100% of biopharma respondents plan to invest in infrastructure and cloud enablement, allocating an average 13% of their total digital enablers spending.”

6Integratedecosystems

ROLE OF ESG IN DIGITAL TRANSFORMATION

About 88% of biopharma companies
plan to increase ESG investments,
above the cross-sector average… with greater emphasis on Sand G

Share of respondents planning to increase/decrease/maintain investment toward ESG in coming years

Leading digital initiatives being prioritized
to support E, S, and G goals

18

Moderatelyincrease

70Maintain as inprevious year(s)Decrease vs.
previous year(s)2592Source: 2021 BCG Global Digital Transformation Survey, n = 48.

1~38· Improving employee health and safety
through software solutions, wearables, etc.
· Creation of targeted, personalized training
programs that are interactive and support
long-term behavioral change~67· Critical risk incident management,
building cyber resilience· Active management of operationallylinked KPIs/metrics

~45

56

17· Waste reduction driven by analytics· Digital supply chain optimization

SocialSigniﬁcantly
increase

CROSS-INDUSTRY AVERAGE (%)

Governance

PHARMA AVERAGE (%)

Environment

SHARE OF RESPONDENTS PRIORITIZING (%)

If you would like to discuss this topic, please contact one of the authors:
JOHANNES THOMSPRIYA CHANDRANKARALEE CLOSESTEPHEN WADDELLCHRIS MEIER

JAZZ TOBACCOWALLAManaging Director & Partner, London
thoms.johannes@bcg.com+44 207 753 6235

Managing Director & Senior Partner, London
close.karalee@bcg.com+44 207 753 6273

Managing Director & Partner, London
meier.chris@bcg.com+44 207 753 8279

GANGA KANNANManaging Director & Partner, New Jersey
kannan.ganga@bcg.com+1 212 446 2813

Managing Director & Senior Partner, New Jersey
chandran.priya@bcg.com+1 973 218 8330

Managing Director & Senior Partner, Austin
waddell.stephen@bcg.com+1 214 468 2310

Managing Director & Senior Partner, New York
tobaccowalla.jazz@bcg.com+1 610 909 1017