Back in the early aughts, record companies stood at a crossroads. Because of technology and customer needs, the way consumers purchased music was changing. They faced a decision: lead the change and maintain their position, or react to it and create a vacuum of opportunity for outsiders (such as Apple with iTunes) to fill. The record companies, stuck in an old mindset, chose convention. Ultimately, they chose wrong.

Drug manufacturers face a similar decision, but it’s not too late to be on the right side of history. Because of an increasingly competitive market, the once tried-and-true model that centered on a best-in-class product no longer allows drug manufacturers to stay ahead of the pack. In order to differentiate themselves, companies need to be attuned to the needs and goals of the other players in the healthcare ecosystem and align their strategies accordingly. With a more holistic view of the whole ecosystem and its various stakeholders, biopharmaceutical companies can create value that includes but also goes beyond the product to improve healthcare outcomes.

The evolution of the cancer treatment landscape in recent years is a good illustration of what can be gained. Early on, oncology drug manufacturers were searching for viable treatments. Since so few existed, following the science promised to deliver a competitive advantage. Simply put, it was enough to have a good product. It’s a strategy that traditionally has paid off, such as with Novartis creating the primary treatment used in chronic myeloid leukemia, Celgene transforming myeloma treatment and Roche being the primary company to create both HER2-positive breast cancer and non-Hodgkin lymphoma treatments.

These companies radically transformed standards of care during the scientific era. They went beyond the specific interventions and significantly innovated the way we treat cancers. Companies like Celgene and Roche influenced the current treat-to-progression paradigms and chronic disease approaches that are now commonplace in many tumors.

However, the industry has entered a new era of increased competition and decreased product differentiation. Although best-in-class molecules will continue to succeed, they don’t have the same advantage. According to ZS research, the duration and intensity of the best-in-class period, where one company enjoys exclusivity, has shrunk significantly. Success as a “category leader” used to be easily measured by market share, but this metric no longer sufficiently assesses whether a company or brand can maintain a competitive advantage in the future market.

Today’s dynamic healthcare ecosystem complicates the decisions that drug manufacturers need to make and surfaces the need for better collaboration and communication among the various stakeholders. Here are a few ways that drug manufacturers can secure a spot in this new landscape and add value beyond what’s traditionally been about the product:

1. Apply a customer-centric lens. Although it used to be acceptable for biopharma companies to come in at the end of the customer journey, when the patient was already receiving advanced cancer care, that role needs to be reevaluated. This requires a deep understanding of both the customer journey and existing unmet customer needs. Companies should broaden their view to include how customers interact with, shape and work within the wider ecosystem and how these interactions create unmet needs. These are opportunities for drug manufacturers to step in. Observing and deriving insights about what really matters to customers—instead of basing your understanding around your company’s own priorities—is key to taking a larger role in the ecosystem.
2. Focus on specific opportunities. Once companies understand the greater system at play, they can (and should) choose what need(s) they can best meet. Although tempting, it would be a mistake to try to address every need, only to fall short. Companies should ask themselves: How are we going to tackle the needs we identified and are we the right entity to do so? What partnerships do we need to accomplish our new goals? How can we engage with our customers differently? If companies form partnerships and collaborations that are based on mutual benefit and value, they’re more likely to succeed in the ecosystem.
   
3. Consider partnerships. It used to be that biopharma companies had the monopoly on treatment-related patient data. Now, groups outside of biopharma, such as tech companies and healthcare startups, are gathering and aggregating patient data. Instead of maintaining the old mindset of working alone, biopharma companies should shift to partnering both with their customers and new industry disruptors. For instance, a biopharma organization with oncology-specific treatments could partner with a patient monitoring company, differentiating themselves as the company that’s intimate with patients and caregivers. This could, in turn, lead to creating beyond-the-pill solutions that carry patients throughout the continuum of care. In the future, successful industry leaders will have to be highly effective at identifying the right partnering opportunities to capture, transform and derive meaningful data and insights to create better customer value.
   

In the end, most record companies survived the change in the music industry. But their refusal to lead said change created a vacuum of opportunity for outsiders like Apple to fill. Similarly, there are various outsiders to the biopharma industry eager to step in and fill that leadership vacuum. Oncology drug manufacturers, in particular, are well positioned to become early adopters of a business-to-ecosystem mindset going forward. The question then is this: Do drug manufacturers want to react to market transformations or drive the change?