MARCH, 2019 | The Health
Health Business
Economic downturn
on the horizon
Healthcare and Pharma CFOs anticipate potential crisis
Companies are having to
reassess their budgets
for 2019 as they failed
to factor in the risk of a
downturn when calculating
the budget figures back in
the Q4 of 2018
M
any companies are having to reas-
sess their budgets for 2019. The
reason? They failed to factor in the
risk of a downturn when calculating
the budget figures back in the final
quarter of 2018. Half of all finance
directors now expect the economy to cool off.
“The cost pressure to pharmaceutical and healthcare
industries is increasing in Southeast Asia, where tradi-
tionally companies enjoyed a lucrative private sector,”
says Yoshihiro Suwa, Roland Berger Partner and Head
of Healthcare in the region. “The evolvement of private
insurance and employer-sponsored insurance in this
region is a key driver for private sector growth, but
those payers are not the same as traditional wealthy
patients,” Yoshihiro explains.
“Many companies have operated very successfully
over the past decade owing to the availability of cheap
money. But now, political instability and growing
protectionism are fanning fears of a downturn,” says
Oliver Knapp, Partner at Roland Berger. Indeed, one
in every two of the executives polled for the Opera-
tions Efficiency Radar anticipate a deterioration in
their business in 2019 – a clear reversal of the views
expressed one year previously. The outlook is seen as
particularly troubled in the automotive industry and
the engineering sector, where as many as 93 percent
and 56 percent of respondents, respectively, anticipate
an economic downturn in 2019.
For 74 percent of companies, the Product Portfolio
will be the focus of their attention in 2019. The main
activities will revolve around cost reduction and
customer-focused optimization of product/service
features. Other key areas for action will be in Produc-
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Month Of January, 2019
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Pacemaker
for the pregnant
PET-CT Scan
is 90% more
accurate
PET-CT Scan is a type
of imaging device
which combines
radiopharmaceuticals,
a specialized camera lens,
and an advanced
computer system to
detect abnormalities
in our bodies. – p09
Plus: Special
pullout – IJN
CLEAN AIR,
our right
T
obacco use is the
leading preventable
cause of death in the
world. Apart from the harms
smoking causes to smokers,
exposure to second-han d
smoke is a major public
health hazard. Everyone has
the right to breathe. Clean
air is our fundamental right.
Th e Health supports the Blue
Ribbon Campaign to inform
smokers and non-smokers
alike about tobacco smoke’s
harms. – p08-11
2019 Budget Highlights Wonder Women
– p12-13 – p14&15 – p20
2019 Budget for health- Malaysian fertility
care aims for impact
in jeopardy
Exclusive
Planning motherhood
years in advance
RISING FROM POVERTY TO A REVERED TYCOON – p22&23
Pregnant woman with
heart condition gets
pacemaker through 3D
mapping system.
– p05
The cure
for weak
hearts
People living with heart failure faces
eternal hardship in life, as they will be
subjected to all life-risking problems,
even with the use of pacemakers, those
whose hearts are tremendously weak will
not live a comfortable life. – p04&05
tion, Controlling & Finance, Sales & Marketing and
Procurement. Working Capital Management has also
moved up the list of priorities since last year. The
authors view this as a further indication of economic
clouds on the horizon.
Digital transformation
as a chance to reposition
This year’s hot topic is digitalization. Responses to the
specific questions examined here indicate that many
corporate functions view the continuing disruption
of their industry as a chance to reposition themselves
strategically within the company. “Sadly, digitalization
is often seen as synonymous with automation. But
not only are there different mechanics at work, the
consequences are also quite dissimilar,” explains Oliver
Knapp. “Functions that focus on automation to the
exclusion of all else will end up eliminating themselves
before too long.”
This view is shared by study participants: Half of all
respondents see a single-minded focus on automation
as a threat to corporate functions. 70 percent of com-
panies polled for the survey anticipate that functions
will need to reposition themselves in terms of the value
they add to the company.
Finance & Controlling as well as Logistics functions
are considered to have particularly good chances to
reposition themselves. “Digitalization brings more
opportunities than threats for Controlling,” forecasts
Prof Dr Heimo Losbichler, Chairman of the Interna-
tional Association of Controllers (ICV). “Controllers
should grasp the opportunities available to them now
to make sure that their function remains an essential
value generator for their company.” — The Health
09
Merck to expand us
biopharmaceutical
r&d facility to
advance innovative
clinical pipeline
Merck, a leading science and technology com-
pany, today announced a $70 million investment
to expand its state of the art research and develop-
ment (R&D) facility in Billerica, Massachusetts. The
new building will span 145,000 square feet, offering
new laboratory and collaborative working space to
accommodate approximately 400 new and current
R&D employees focused on advancing science in
oncology, immuno-oncology and immunology.
“Our talented and passionate R&D teams based
in Billerica have been highly engaged in advancing
a number of pipeline compounds,” said Luciano
Rossetti, Head of Global Research & Development
at the Biopharma business of Merck. “We continue
to strengthen our innovation footprint in both the
U.S. and Darmstadt, Germany where our global
R&D headquarters are located, with the goal of
delivering transformational value to patients
around the world.”
With this latest project, Merck will have invested
more than $150 million in infrastructure to
advance biopharmaceutical R&D in the state of
Massachusetts in recent years, with more than 150
new jobs added to its growing U.S. R&D Hub in
Billerica since 2011. The town of Billerica played a
critical role in bringing this latest building expan-
sion project to fruition, working collaboratively
with Company officials to underscore the benefits
of expanding the state-of-the-art R&D facility.
“Merck’s continued investment in Massachu-
setts is a testament to the state’s global leadership
in life sciences,” said Travis McCready, President
and CEO of the Massachusetts Life Sciences
Center. “In working collaboratively with the town
of Billerica, the company’s campus expansion over
the past decade has not only helped attract and
retain top talent in the area, but more importantly,
contributed to improving the lives of people with
serious medical needs.”
When construction is completed in 2021, the
building will offer wet labs, office space and a
cafeteria for the campus. Consistent with previ-
ous projects, the building will be constructed
to the highest environmental and employee
wellness standards by seeking LEED® and WELL
certifications. LEED is a preeminent program for
the design, construction and operation of high-
performance green buildings. WELL is a building
standard focused on enhancing people’s health and
wellness through built environments.
Merck’s U.S. presence is comprised of three busi-
nesses - Healthcare, Life Science and Performance
Materials - with nearly 10,000 employees working
in R&D, manufacturing and corporate roles across
almost 60 sites country-wide. Within the state of
Massachusetts, more than 2,800 professionals
work across 10 locations. — The Health