6 predictions for healthcare and biotech in 2024

By: Jill Collins, PhD
This article originally appeared on Forbes

It’s been a volatile few years in the healthcare and biotech space. In 2020, the Covid-19 pandemic created massive growth from investment into healthcare. By 2022, as the pandemic waned, biotech took a tumble, marked by slashed budgets, massively reduced headcounts, and cautious financial stewardship. The pandemic officially ended on May 11, 2023, and we are still waiting to see what the future holds. As we move further into 2024, biotech and healthcare markets are starting to win back their optimism. Here is my forecast for 2024.

Companies will value efficiency over novelty.

The R&D and marketing budgets we saw during the Covid-19 pandemic are gone, and they are likely not coming back. This will push successful companies to prioritize conservative business strategies over innovation. Strong R&D funding rewards innovation, which leads to breakthrough ideas and even lucrative category creation. A focus on near-future efficiency shifts companies away from distant and risky R&D rewards

Last year, I predicted a shift toward multi-omic testing as the next big thing, much like Next Generation Sequencing (NGS) changed everything when Illumina kick-started the genomic testing market. At the outset, these products amassed as much data as possible. As budgets tighten, it is likely we’ll see these technologies shift toward efficiency and focus, rather than continuing to expand in scope.

Acquisition strategies will return.

During the ​“wait and see” period of Covid-19 recovery, acquisitions and investment in biotech slowed down. Companies prioritized preserving cash and refrained from mergers and acquisitions. Startups that could postpone being acquired or going public quietly accumulated value, holding out for a market revitalization and better prices. With biotech investments at unprecedented lows, we were seeing organizations holding more cash than their valuation. As stock prices rebound, companies will likely return to spending and acquisitions. We’ll see fewer mergers or acquisitions overall, but some of those we will see are likely to represent greater value and involve later-stage companies.

The biotech workforce is going to feel these ramifications as well. While the massive waves of layoffs that we saw last year are tapering off as biotech reenters the green, this refocusing on profitability means that doing more with less is likely to be 2024’s status quo. As the market corrects, I foresee more of a moderate wave of rehiring than a true job boom. In order to balance the needs of business with fewer internal resources, finding reliable and knowledgeable agency partners will be more important than ever.

Startups will need to achieve profitability faster.

A culture shift that I think we’ll see as a result of my first two predictions is an end to unsustainable fundraising-based investment models in biotech. In the post-pandemic crash, many companies folded, and many others divested less profitable arms of their business. In a market where efficiency is valued, businesses that continuously rely on borrowing money or raising venture capital will see much shorter runways before they are expected to operate in the green.

Telehealth will find its balance.

There was a shift toward telehealth during the early days of the Covid-19 pandemic, with many companies rushing to offer new services online. Patients enjoy having the option to choose telehealth, but as gathering has become less risky, evidence shows that they overwhelmingly choose in-person appointments for most of their needs. Not only that, but physician offices prefer the higher rates they can collect from in-office visits, and some payers have ceased coverage of telehealth visits. However, Congress is working toward payment parity with several new bills aimed at extending telehealth coverage. All of this means that we’re likely to see telehealth remain an option for most individuals.

AI will continue to transform healthcare.

While many consumer brands are embracing AI with open arms, healthcare is still developing confidence. It is likely we’ll see a staggered acceptance as AI proves useful for different areas within healthcare over several years. Bioinformatic researchers often deploy AI tools to comb through massive multi-omic datasets, and in care settings, it’s currently used for basic administration or patient communication tools. Other early clinical adopters are oncology centers that utilize AI and sophisticated resource databases to decipher the optimal treatment strategy based on clinical and biomarker data as well as regulatory, reimbursement and guideline-driven recommendations. I predict we’ll see increased interest in diagnostic treatment support, as well as identifying patient trends and anticipating their needs.

A revolution in brain health diagnostics and treatment is starting

In 2023, the FDA approved the second therapeutic in a new class of drugs targeting amyloid plaques which can slow cognitive decline caused by Alzheimer’s disease. Currently costs are high and the clinical impact is small, but there is a lot of interest in this field. Patients and their loved ones have a strong desire to do everything possible to protect brain health, so I predict we’ll see an increased demand for these therapies. I think we’ll see a flock of companies trying to offer an easier and more cost-effective method of diagnosing patients with these amyloid plaques, such as a blood test instead of PET imaging.

Covid-19 delivered a huge shock to the world and we saw it play a prominent role in shaping the biotech industry. We’ve finally gained enough distance that we can see which radical shifts were temporary and which will sustain and redefine our industry landscape. One thing is certain: 2024 shows promise and possibility. For wary investors this may be a good year to revisit and reinvest in the promise of biotech, especially in growth areas like brain health. For companies that are relearning how to be nimble on a tight budget, it is a good year to reaffirm relationships with external vendors that can help support your smaller team. For those of us in the marketing and branding space, it will be a great year to revisit in-person activations and events.

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[[Hi, Jill! Could you please link to sources (major news, research or trade publications) to support all of the statements I’ve underlined throughout your article?]]

Original article

7 Predictions for Healthcare and Biotech in 2024

It’s been a volatile few years to run a marketing agency in the healthcare and biotech space. Starting in 2020, the COVID-19 pandemic created massive growth from investment into health and research, but also strain and burnout among workers. By 2022, as the pandemic waned, biotech took a tumble, marked by slashed budgets, massively reduced headcounts, and extremely cautious financial stewardship. The pandemic officially ended on May 11, 2023, and we are still trying to figure out what the post-pandemic future holds. As 2024 begins, biotech and healthcare markets are starting to win back their optimism. We’re in a unique position compared to the past few years, and as our industry finds its legs again, here is my forecast for 2024.

Companies will value efficiency over novelty.

The R&D and marketing budgets we saw during the COVID-19 pandemic are gone, and they are likely not coming back. This will push successful companies to prioritize more conservative business strategies over innovative new research. When there are lots of resources available for R&D, it makes sense to innovate as much as possible, which can lead to breakthrough ideas, and even lucrative ​“category creation.”. Last year I predicted a shift towards multi-omic testing as the next big thing, much like NGS changed everything when Illumina kick-started the genomic testing market. At the outset, the goal for these products was to amass as much data as possible. While the multi-omics approach is still going strong, we also expect to see the impact of budgets tightening. I think it is likely we’ll see the future of these new technologies shift towards efficiency and focus, rather than continuing to expand in breadth and scope.

Brands will have to rethink acquisition strategies.

During the ​“wait and see” period of COVID-19 recovery, acquisitions and new investments in biotech slowed down. Companies prioritized preserving cash and refrained from mergers and acquisitions. Small start-ups that could afford to postpone being acquired quietly accumulated value, holding out for a market revitalization that could lead to a better price. With biotech investments and stock market prices at unprecedented lows, we were seeing organizations holding more cash than their valuation. As stock prices rebound, both start-ups and established companies are going to feel better about their company’s position and value, and will return to spending. This means a return to acquisitions as a viable strategy. It is likely that we’ll see fewer mergers or acquisitions overall, but some of those we will see are likely to represent greater value and involve later stage companies.

The biotech workforce is going to feel these ramifications as well. While the massive waves of layoffs that we saw last year are tapering off as biotech reenters the green, this refocusing on profitability means that doing more with less is likely to be 2024’s status quo. As the market corrects, I foresee more of a moderate wave of rehiring than a true job boom. In order to balance the needs of business with fewer internal resources, finding reliable and knowledgeable agency partners will be more important than ever.

Start-ups will need to achieve profitability faster.

A culture shift that I think we’ll see as a result of my first two predictions is an end to unsustainable fundraising-based investment models in biotech. In the post-pandemic crash, we saw many companies fold, and many others divest less-profitable arms of their business. In a market like this, where efficiency is valued and each acquisition is likely to be weighed more carefully, businesses that continuously rely on borrowing money or raising venture capital will see much shorter runways before they are expected to operate in the green.

Telehealth will find its balance.

There was a massive shift towards telehealth during the early days of the COVID-19 pandemic, with many companies rushing to offer new services online. Patients do enjoy having the option to choose telehealth, but as gathering has become less risky, evidence shows that they overwhelmingly choose in-person appointments for most of their needs. Not only that, but physician offices prefer the higher rates they can collect from in-office visits, and some payers have ceased coverage of telehealth visits. However, Congress is working towards payment parity with several new bills aimed at extending telehealth coverage. All of this means that we’re likely to see telehealth remain as an option for most individuals, but utilization may still be split for routine versus mental health needs. Therefore, it is not likely to transform the standard of healthcare any time soon.

Trade conferences will return in a big way.

This is another pandemic culture shift that we’ve had an opportunity to re-evaluate. Like telehealth, virtual conferences and webinars saw a huge uptick during the pandemic to try to ​‘replace’ the in-person opportunities from scientific meetings or in office sales appointments. Many of our clients are still seeing a strong return on sharing recorded educational content, but as an industry there is a real hunger to get back out there, network, and converse face-to-face. Brands seeking to capitalize on the return of tradeshows will have to rediscover how to build a strong in-conference brand presence, and return to geo-location targeting strategies digitally.

AI will continue to transform healthcare.

While many consumer brands have already embraced AI with open arms, healthcare is still developing confidence in this space. I think it is very likely that we’ll see a staggered acceptance as AI proves useful for different areas within healthcare over the course of several years. We are already seeing increased automation for repetitive tasks, which in research can look like combing through massive datasets or performing multi omic analysis, and in care settings can look like basic admin or patient communication tools. Some early adopters are already here: AI and sophisticated resource databases are currently being applied in some oncology clinics to decipher the optimal treatment strategy based on clinical and biomarker data as well as regulatory, reimbursement and guideline-driven recommendations. This year I predict we’ll see increased interest in diagnostic treatment support, as well as using the predictive power of AI to identify patient trends and anticipate their needs.

A revolution in Alzheimer’s testing and treatment is starting

This is one area where we are still likely to see the possibility of category creation. 2023 saw the FDA approval of the second therapeutic in a new class of drugs targeting amyloid plaques which can slow cognitive decline caused by Alzheimer’s disease. It’s early days, and right now costs are high and the clinical impact is relatively small, but there is a lot of interest in this field. Patients and their loved ones have a strong desire to do everything possible to protect brain health, so I predict we’ll see an increased demand for these therapies. I think it is also likely we’ll see a flock of companies trying to offer an easier and more cost effective method of diagnosing patients with these amyloid plaques, such as a blood test instead of PET imaging.

COVID-19 delivered a huge shock to the world and we saw it play a prominent role in shaping the biotech industry in new ways. We’ve finally gained enough distance that we are able to see which radical shifts were temporary and which will sustain and redefine our industry landscape. Four years later, the health and technology sector is finally going to be able to reimagine our shared future, rather than deal with the shockwaves of the past. One thing is certain: 2024 shows a lot of promise and possibility.