The effect of a pandemic on the Life Sciences industry

Abstract

Pharmaceutical, healthcare and biotech companies have been at the forefront of the COVID-19 response, from drug trials and vaccine development to the production of personal protective equipment (PPE) and ventilators. The industry has a unique ability and responsibility to help the world respond to the global pandemic, both by working collaboratively to deliver solutions to the virus and also by maintaining the supply of medically important products to those who need them. As in all industries, business in the sector has been disrupted by the virus. This is largely driven by a reduction in healthcare provider and patient interactions as hospitals redirect resources toward COVID-19, and patients avoid healthcare facility visits and postpone preventative care. The impact on specific companies will depend on the diversity of their portfolio and their largest revenue areas. For example, roughly two thirds of Merck’s global Human Health revenue is comprised of physician-administered products and decreased volumes during the pandemic are expected to have a negative impact on revenues. Whilst much of the pandemic impact will be short term, peaking over the next quarter in conjunction with the peak of the virus in the US and Europe and settling towards the end of the year, it is likely we will see some long term structural change in the industry as global attitudes towards health shift in the wake of the pandemic.