Life sciences includes a broad range of scientific fields that study living organisms and their interactions with the environment. Some of the key areas within life sciences include:
- Biology: The study of life and living organisms, including their structure, function, growth, evolution, and behavior.
- Biotechnology: The use of biological systems, organisms, or derivatives to develop or create products, often focusing on medical or agricultural applications.
- Genetics: The study of genes, heredity, and genetic variation in living organisms.
- Microbiology: The study of microorganisms, such as bacteria, viruses, fungi, and protozoa.
- Pharmacology: The study of drugs and their effects on living organisms.
- Medicine: The science and practice of diagnosing, treating, and preventing diseases in humans.
As with many other industry segments, companies in the life sciences arena are grappling with disruptive changes in their go-to-market strategies while at the same time looking to improve their business processes via digital transformation. This new Insights Post explores how the SAP ecosystem can help life sciences companies align initiatives in both of these areas with digital transformation initiatives that embrace new subscription-based revenue opportunities and simultaneously map out an optimized roadmap for moving to more efficient cloud-based ERP and overall business systems.
Disruptive Trends in Life Sciences
The subscription-based Digital Solutions Economy (DSE) is significantly impacting new business models in the life sciences industry by shifting how companies deliver products, services, and solutions. This trend is transforming traditional business approaches, creating new opportunities for innovation, revenue generation, and customer engagement. Some key impact areas include:
Shift from Product Sales to Service-Based Models
- Software as a Service (SaaS): Life sciences companies are increasingly adopting SaaS models, offering subscription-based access to critical software tools for drug discovery, clinical trial management, and regulatory compliance. This shift allows companies to provide ongoing updates, improvements, and support, creating a continuous revenue stream and stronger customer relationships.
- Device as a Service (DaaS): Instead of selling medical devices outright, many companies are offering them on a subscription basis. This model includes ongoing maintenance, updates, and integration with digital health platforms, ensuring that devices remain up-to-date and compliant with regulatory standards.
Personalized Medicine Subscriptions
- Therapeutic Subscriptions: With the rise of precision medicine, life sciences companies are developing subscription models for personalized treatments. For example, patients with chronic conditions might subscribe to a service that provides tailored medications, continuous monitoring, and regular adjustments to their treatment plans based on real-time data.
- Genomic and Diagnostic Services: Companies are offering subscriptions to genomic testing and diagnostic services, enabling customers to regularly monitor their health and receive personalized insights. These services often include access to health coaches or genetic counselors as part of the subscription package.
Data-as-a-Service (DaaS)
- Real-Time Data Subscriptions: Life sciences companies are monetizing data by offering subscription-based access to real-time data analytics platforms. These platforms can provide pharmaceutical companies, healthcare providers, and researchers with valuable insights into patient populations, treatment efficacy, and market trends.
- Patient Data Platforms: Companies are creating platforms where patients can subscribe to services that manage and analyze their health data, offering personalized health recommendations and integrating this data with broader research efforts.
Outcomes-Based Subscriptions
- Performance-Based Contracts: Subscription models are being tied to patient outcomes, particularly in the case of high-cost treatments like gene therapies. Life sciences companies enter into agreements where payment is tied to the success of the treatment, incentivizing both the company and healthcare providers to achieve the best possible outcomes.
- Patient Support Programs: Subscriptions that include comprehensive patient support programs are becoming more common. These programs might include ongoing access to healthcare professionals, educational resources, and lifestyle management tools designed to improve patient adherence and outcomes.
Clinical Trial Innovation
- Subscription-Based Access to Trials: Companies are experimenting with subscription models that provide patients or healthcare providers with access to a suite of clinical trials. This could include benefits like faster enrollment, real-time monitoring, and personalized trial matching based on patient profiles.
- Continuous R&D Collaboration: Pharmaceutical companies are subscribing to collaborative R&D platforms that facilitate ongoing partnerships and data sharing with academic institutions, biotech firms, and contract research organizations (CROs). This fosters a more agile and responsive R&D process.
Digital Health Platforms
- Health Monitoring and Management Subscriptions: Subscription models are emerging in digital health, where companies offer platforms that include health monitoring devices, data analytics, and personalized health management tools. These platforms often integrate with wearables and mobile health apps, providing continuous care and support.
- Telemedicine Services: Life sciences companies are partnering with telemedicine providers to offer subscription-based access to virtual healthcare services. These subscriptions can include teleconsultations, remote diagnostics, and ongoing health management support.
Sustainability and Cost Management
- Pay-per-Use and Consumption Models: Subscription models in life sciences also include pay-per-use or consumption-based models, where customers pay based on the volume of services or products they use. This is particularly relevant for labs and research facilities that require flexible access to expensive equipment or reagents.
- Sustainable Practices: Subscription models encourage life sciences companies to focus on sustainability by offering products and services that are maintained and updated over time, reducing waste and extending the lifecycle of products.
Patient Engagement and Retention
- Continuous Engagement: Subscription models help companies maintain continuous engagement with patients, leading to improved adherence to treatments, better health outcomes, and long-term loyalty. These models often include regular touchpoints through digital platforms, personalized content, and ongoing support services.
- Enhanced Customer Experience: By focusing on a service-oriented approach, companies can deliver a more personalized and responsive customer experience. This can lead to higher satisfaction rates and a stronger brand reputation in the market.
The subscription economy is enabling life sciences companies to move beyond traditional product sales and towards more sustainable, patient-centric, and data-driven business models. This transformation is fostering innovation, improving patient outcomes, and creating new revenue streams across the industry.
Deploying SAP Solutions for New Subscription-based Offerings
Managing these new DSE offerings while laying down the roadmap for digital transformation entails complex revenue recognition and compliance issues, and bundled equipment offerings with new usage-based models using Order-to-Cash billing and revenue innovation management solutions. In addition, advanced equipment lease management solutions come into play. Also, the ability to leverage comprehensive agnostic analytics tools such as SAP Analytics Cloud will be key to enabling agile decision-making that takes into account timely data from all parts of the end-to-end process.
As one of SAP's longest serving partners and the recognized experts in SAP revenue compliance and SAP BRIM/OTC offerings, the Bramasol team has deep experience with tailoring a range SAP solutions to specific client requirements. For example, SAP's Order-to-Cash portfolio, formerly known as BRIM, offers a suite of applications, including Subscription Order Management, Subscription Billing, Convergent Charging, Convergent Mediation, and Convergent Invoicing, along with SAP Revenue Accounting & Reporting (RAR) for revenue compliance. Since not all of these elements are required for every implementation, or it can make sense to start small and add functionality according to a pre-determined plan, Bramasol takes a unique approach to combining specific SAP BRIM applications with revenue compliance to give companies the exact features they need, along with a clear path forward.
Created for SAP's Partner Packaged Solution (PPS) process, Bramasol's purpose-built PPS is specifically targeted to provide a turnkey, rapid-deployment, end-to-end methodology to implement subscriptions and bundled offerings with seamless revenue compliance in SAP S/4HANA Cloud. With a focus on only those business processes needed to quickly launch a robust, scalable subscription business, the package includes key end-to-end processes in the areas of Sales, Finance and Procurement, including Invoice-to-Cash, Order-to-Fulfill, Record-to-Report and Procure-to-Receipt. As shown below, everything that is needed can be combined within a unified architecture that leverages the inherent scalability of S/4HANA Cloud Public Edition and SAP Business Technology Platform (BTP).
SAP Cloud-Based Digital Transformation Solutions
In addition, for life sciences companies currently in the SAP ecosystem or others looking to move to SAP, their subscription business implementations need to provide a seamless pathway to SAP S/4HANA in the cloud. Those moving from ECC or on-premises implementations are looking for ways to fast track their subscription management, billing and revenue compliance into highly scalable SAP Cloud Public or Private Edition environments. Or companies looking to set up new Greenfield implementations in SAP Cloud Public Edition need a smooth route to rapidly creating their end-to-end processes in S/4HANA, without taking on more complexity than necessary.
Based on each life sciences company's current ERP system, whether experienced with SAP on-premise or new to SAP, the RISE and GROW options can offer tailored paths towards rapidly achieving customer success.
- For new companies that need standardized processes, want to always be at the latest release, and prefer a cloud provider to manage their infrastructure, GROW with SAP offers a seamless Greenfield deployment path to SAP S/4HANA Cloud Public Edition.
- For companies already using SAP on-premise because they need customization and control over their deployment environment, SAP S/4HANA Cloud Private Edition provides the power of cloud with the ability to adapt to specific needs. RISE with SAP enables a customizable forward path for either Greenfield or Brownfield deployment scenarios, or to run a hybrid, two-tier, cloud environment using both public and private cloud editions for different functions.
Both GROW and RISE with SAP are designed to support smooth customer transformation journeys from their unique starting points by leveraging the SAP modular ERP cloud architecture as shown above. The core cloud ERP can be SAP S/4HANA in either Public or Private cloud deployments. SAP S/4HANA Cloud's Digital Discovery Assessment (DDA) is another SAP tool that enhances decision-making processes to achieve your organization's objectives. It provides seamless visibility and valuable insights into the extensive array of capabilities offered by S/4HANA Cloud. The DDA scoping capabilities empower your team to unlock transformative opportunities, streamline operations, and fully embrace digital innovation by leveraging SAP's modular cloud technologies.
Migration to SAP S/4HANA Cloud Public or Private Edition offers huge benefits in terms of applications unification, digital transformation, scalability and process efficiency. Specific advantages for life sciences companies include:
- Boosting efficiency, cutting costs, and enhancing quality with real-time inventory and supply chain insights for life sciences and healthcare.
- Advancing personalized healthcare by connecting life sciences and healthcare data and automating predictive forecasting processes.
- Supporting future growth with a modern cloud ERP solution, as well as tools and services for managing a successful migration.
- Incorporating circularity into your life sciences or healthcare supply chain and create corporate sustainability models.
- Using advanced analytics for clinical, sensor, and other Big Data, facilitating personalized medicine and drug and device development.
- Increasing visibility across the supply chain and streamline collaboration with life sciences and healthcare contract manufacturers.
- Speeding up service delivery for life sciences and healthcare businesses and enhance customer satisfaction with integrated processes.
- Simplifying life sciences and healthcare procurement with embedded AI that identifies data patterns to develop a model that helps resolve purchasing disconnects.
Summary
By leveraging our 28 years as a leading SAP Partner with experience helping companies navigate multiple ERP transitions, Bramasol is now once again at the forefront in designing and managing clients digital transformation journeys with SAP S/4HANA Cloud. The Bramasol team is currently involved in some of the largest Greenfield implementations in SAP S/4HANA Cloud Public Edition and we are also helping companies with using SAP RISE to transition from on-premise SAP environments to SAP S/4HANA Cloud Private or Public Editions. As a result, Bramasol is well-positioned to help life sciences companies simultaneously stay competitive with new offerings and enhance their bottom line business efficiency with digital transformation.