[on the spot view] Du Chen: "strategic devil's triangle" against five major difficulties of pharmaceutical enterprises

"Faced with five difficulties in the pharmaceutical industry? Only by improving the cognition, reshaping the strategy on the basis of the new cognition, uniting the consensus with the strategy, improving the leadership and executive ability, facing the new ecology, new choice and new situation with a new attitude, can we fundamentally promote the strategic transformation " How to improve the cognition and understand the current situation of Chinese medicine? Actually, it depends on whether they have a good understanding of many things in reality Many enterprises operate well, but their cognition is not very right Only by deepening the cognition, can they go on the road of enterprise development for a long time, which also reflects the importance of cognition The growth of therapeutic drugs, the limitation of auxiliary drugs, the restriction of antibiotics and the decline of proprietary Chinese medicine are the changes of market structure in the next five years Now, as a pharmaceutical entity, from the perspective of capital, we can see the changes of market to a certain extent Since June 2018, PE and VC have encountered difficulties in financing, financing and investment, which is obvious in the capital market In May this year, the total scale of the fund's target fundraising fell by 91.44%, which fully shows that the situation of China's venture capital market is becoming more and more severe, and the market structure is undergoing tremendous changes Ten years ago, China had a population of 1.33 billion, medical frequency of 5.488 billion, and hospitalization of 131 million Last year, China had a population of 1.39 billion, close to 1.4 billion The number of diagnosis and treatment was 8.3 billion, and the number of admission was 250 million, with a population growth of only 4.7%, but the number of diagnosis and treatment increased by 51%, and the number of admission increased by 92%, almost double the amount What does this mean? This actually gives you a signal that the demand growth of Chinese medicine market is very strong Since July 22, 2015, the state has issued more than 180 documents, such as conformity evaluation of generic drugs, two vote system, 4 + 7 volume procurement, and the influence of the Ministry of Finance on 77 enterprises' verification and other policies, which have caused severe shocks in the pharmaceutical sector The market value of only 4 + 7 pharmaceutical sector has evaporated by more than 300 billion From policy to enterprise growth, it is actually five factors that promote the complete transformation of Chinese pharmaceutical enterprises 1 The practical requirements of the people's needs: the people's deeper understanding of drugs causes the market to deepen the demand for drugs Just like in the movie "I'm not the God of drugs", even expensive drugs are purchased by some people, which shows that the people's needs have always been there 2 Balance of medical insurance fee and drug price: why to reduce the price? Because health care can't afford it 3 Global pharmaceutical market competition: in the future, it is not a question of whether you can open it or not, but it must be open and cannot exist alone in the world 4 The era of drug profiteering has come to an end: there is no longer an era when bad drugs can make a lot of money 5 Substitution of generic drugs: the United States has gone this way, Japan has gone this way, Taiwan Province has also gone this way, and the mainland is going this way, which is why the medical reform is taken On June 21, at the 2019 China Pharmaceutical Health Industry Development Conference and the fourth China Pharmaceutical R & D Innovation Summit (PDI Conference) held in Chongqing, Mr Du Chen, a strategic management expert, senior professional manager, senior partner of Beijing Times strategy consulting and chief consultant, made a report on coping strategies for pharmaceutical enterprises' transformation difficulties Analysis of the new situation, business transformation strategies In the Symposium of entrepreneurs of Shanghai Pharmaceutical fair, many entrepreneurs expressed anxiety about the development of current pharmaceutical industry, whether it was "4 + 7" discussion or auxiliary drug catalogue discussion, but anxiety could not solve the problem In the past, it was a question of how much money to earn Now it is a question of life and death Some experts predict that in ten years, there will be more than 1000 pharmaceutical enterprises from 4400, and even more ruthlessly 500 Some enterprises are in a zombie state, and some enterprises will die This is normal This is the performance of changes in market rules In the past, China's GMP has Chinese characteristics Foreign research and development to China should start from scratch, which is to protect Chinese enterprises Now, the situation is different There are a lot of clinical data used abroad and also applicable to China In 2017, China joined the list of ICH, and in the future, it will step up its internationalization In the future, new drugs and foreign drugs will be listed simultaneously This further revealed that if enterprises do not race, do not grasp the R & D, there will be the risk of being eliminated In addition, the structure of the pharmaceutical industry is also changing In the past, the market structure was simple, consisting of patent drugs with huge profit margin and thin profits with serious homogenization In the future, there will be three parts, consisting of innovative drugs, high-quality generic drugs and homogenized products However, the bottom homogenized products are destined to be eliminated in the future, and gradually formed two parts: innovative drugs and high-quality generic drugs Part composition This is the change of China's pharmaceutical industry since 2015, and it has also created the five difficulties faced by enterprises Each enterprise has different attitudes and practices in the face of the difficulties, so as to optimize the market and improve the market The dilemma of low cost: in the past, we generally did not make scientific inventions, applied research fields, and innovative drugs as generics In China's pharmaceutical enterprises, we generally valued sales rather than research and development, and the proportion of investment in research and development was far lower than that of developed countries, which is the concept value of low cost The dilemma of habit: in the past, the effective methods are not working It has become a habit to focus on technology and sales, long-term and current, and cost and standard The dilemma of direction: internal confusion, knowing the problem but not knowing where, knowing where but not how to solve it; external confusion: rapid policy change, complex environment, vague direction The dilemma of R & D and Innovation: R & D investment is not small but suddenly becomes a "sunk cost", getting production approval but no market, acquiring many enterprises but dragging down their own enterprises, etc The dilemma of capital: it's more and more difficult to rely on general medicine to make money for new drugs; capital has two sharp edges; if the capital can't be raised, the money can't be put out, which will hurt the gambling Last year, a lot of pharmaceutical companies were reluctant to gamble They could not complete the gamble, which was very harmful to the enterprises Some enterprises failed to recover from the gamble, some lost their cash flow, they could not do without money, and they suffered a lot with money In the face of changes and difficulties, more than 4400 pharmaceutical companies have no more than three approaches Either recognize the essence and take appropriate measures to deal with it, actively follow or promote the change; or see the threat but do not find a way out; or live in the inertial thinking without any change But what is the most correct choice is to improve cognition, see through the essential things of industry, change ideas, act on the right path and rebuild strategies so as to enter a new world and new pattern 03 Many enterprises have made strategies to deal with the "strategic devil's triangle" against difficulties, but they don't know where there is a problem? It just didn't land It is understood that most of them are because most of the strategies have not been implemented at all Strategy requires a strong executive power With executive power and strategy, it is not enough, and leadership is indispensable There are three main points in this: one is strategy, one is executive power, and the other is leadership Whether the strategy can succeed depends on whether the supporting role of the latter two can be embodied Strategy: first place in enterprise transformation In the face of the new ecology, many enterprises are in a state of confusion and powerlessness, headache, headache, pain, and foot can't solve the problems, according to the past experience can't solve the problems of the present and the future, solving the problems of the appearance can't bring about a lasting, profound and new future, relying on "nothing can't" entrepreneurs and managers alone can't solve the problems, but also bring new problems What to do? Or return to the root, in the strategic level, to solve in a systematic way, refine the distinction, and implement the details Use strategy to build consensus: only when there is consensus can there be valuable actions, R & D, production and marketing consensus be unified, grass-roots, middle-level and decision-making consensus be unified, and the consensus between managers and shareholders be unified Otherwise, it will depend on power / relationship / repeated communication, and then there will be internal and external consistency Centralized resources / continuous accumulation: if an enterprise does not have a strategy, it will go up at the opportunity, swing left and right, and it is difficult to concentrate resources If there is no strategy, it will be like this today, everyone is like this, so I also want to do the same, go up in a swarm, do what is popular, always follow the trend, always catch up with the next trend, this is a typical opportunity oriented enterprise Strategy creates foresight: because of strategy, enterprises will regularly conduct internal and external environment analysis, resource analysis and strategic inventory, which will create foresight and improve foresight and planning Strategic response to change and uncertainty: strategy will change external uncertainty, ambiguity, complexity and rapid change into internal certainty, clarity and simplicity Executive power: from the promotion of executive power, the strategic goal can be realized from the beginning to the end, and the executive power supports the strategy When formulating the strategy, the executive and talent needs are considered, so that the executive is established in the realm of strategy Cooperating with the development of system + process, technological progress, mechanism, culture and human resources, in many aspects and from many angles, closely cooperating, working together and coordinating, rather than simply believing that pressure will improve the executive power, scolding two sentences will improve the executive power, or setting up a department, or changing people, or training, all of which cannot fundamentally solve the problem Finally, we need to understand the executive power The ultimate goal of strength and strategy Leadership: improve the cognitive level of leadership support strategy, which means not only to oneself, but also to have a new understanding of enterprises, posts and industries in a broader range Secondly, we need a way of learning that goes beyond the traditional way What we used to read was books, but what we need now is the same frequency stimulation of books and cases We need to learn from mistakes, learn from the future, and solve practical problems We also need to start horizontal and top-down capital We need to open up horizontal departments of enterprises, and reflect the wisdom of grass-roots employees Finally, as a boss, he should have a correct decision-making ability It is one-sided to find a group of people to discuss instead of thinking in the room alone Only by combining investigation, research and comprehensive analysis can he be more profound Click "read the original" to enter the "2019 China Pharmaceutical Health Industry Development Conference and the fourth China Pharmaceutical R & D Innovation Summit" (PDI Conference) Xinhua special page, zero distance direct attack on the conference graphic live broadcast, high-end interviews, wonderful reports Statement: this opinion only represents the author, not the position of yaozhi.com, welcome to exchange and supplement in the message area; if you need to reprint, please be sure to indicate the author and source of the article.