Pharmaceutical companies tinker with digital future

A balancing belt between trees, beanbags, several huts around it: The "BI X" digital laboratory at Boehringer Ingelheim, which has been in operation for about a year, doesn't look at all like the premises of a pharmaceutical company. Where the guest canteen used to be housed, IT specialists are now tinkering with new product ideas, beyond pills or capsules. Flat-screen monitors line one wall in "BI X". They show the status of the work of five teams pursuing various pilot projects.

Boehringer is looking for new business models in the digital environment, says "BI X" head Heiko Schmidt to the Deutsche Presse Agentur. The laboratory, in which the Ingelheim-based company invested around ten million euros at the start of the project, works together with all Group divisions. The aim, he says, is to test new ideas for technical feasibility and potential benefits in a short space of time and to develop working prototypes within a few months. Initial projects have been completed, such as a digital portal for exchanges between pet owners and veterinarians.

What will come on the market is not foreseeable

"In the U.S., pet owners have recently been able to arrange and conduct virtual doctor visits via video instead of having to drive to the doctor's office with their pet," Schmidt explains. In artificial intelligence, teams are working on ways to use learning algorithms to better diagnose diseases. What will end up on the market is not yet foreseeable. Many things have to be tried, says Boehringer's Germany boss Stefan Rinn. There is always a risk that something will not work, even after months of work.

Like Boehringer, others in the industry are experimenting in new fields, such as Merck in Darmstadt, Germany. The group opened its new innovation center for the 350th anniversary celebrations in May. The futuristic building made of concrete and glass cost around 69 million euros. On six floors, there are modern offices, conference rooms, recreation zones, an auditorium and a work zone with laser cutting and 3D printers.

The goal is "a creative and agile environment where curious minds come together to develop new technologies for our future business," Merck CEO Stefan Oschmann said at the opening ceremony. The center is home to 150 internal and external employees.

For instance, they are working on biotech solutions for meat grown in the lab from tie and simple quantities in the human body for data-based disease treatments. The third important area is technologies to detect and treat diseases based on traces in blood samples.

565 startups also applied for a spot at the center. Ten are to be awarded the contract and move in in January. Merck is paying a lot for the prospect of ideas from outside the company: The companies receive offices, training and up to 50 employees over a period of three months.000 euros.

Specialists are wanted

The hip innovation center is also intended to show that the rather conservative family-owned company Merck is opening up and is competitive as an employer. Because software developers and scientists are in demand in the shortage of skilled workers: According to the digital association Bitkom, Germany alone lacks 55.000 IT specialists.

Software specialists and data scientists are sought after by companies in many sectors of the economy, explains Thilo Kaltenbach, a healthcare expert at the consulting firm Roland Berger. Pharmaceutical companies would therefore have to present themselves attractively. This can be achieved through collaboration on exciting innovations, involvement in strategic decision-making processes, but also through personal ies such as appreciation, flexible working hours or home office solutions.

The problem can be that it's not easy to assess what added value innovation centers bring in terms of revenue and profit, says the consultant. While everyone is convinced of the benefits and importance of digitization and artificial intelligence. In the medium term, however, there is a need for objectively measurable success criteria.

International teams

"We need to recruit internationally," Boehringer's "BI X" lab chief Schmidt also says. The working language is English, 51 people from 19 nations are employed here, most of them less than 30 years old. Unlike in the past, the sought-after experts cannot be lured with company cars, but rather with flights home to their parents.

In Boehringer's lab, teams only become active when no start-up is yet working on a similar idea, i.e., there is not yet a solution on the market, as Schmidt says. It is important for the teams to sit together in Ingelheim. "Our experience has been that virtual teams don't work like that. We don't have much time."

The classic development of active ingredients is very heavily regulated, while working in innovation centers is something new, says Kaltenbach. It is also important for the pharmaceutical industry not to leave the field to tech companies such as Google or Amazon. "Businesses are going through a bit of a revolution here right now."

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