Memo To Merck: Rethink Big Pharma!

A major discovery of 21st Century business is that there is no such thing as a mature industry with only slow growth possibilities: these are merely industries to which management has yet to apply imagination. Steve Jobs at Apple [AAPL] has demonstrated the validity of the proposition in music, the mobile phones and tablets, as has Jeff Bezos at Amazon [AMZN] in books and retail.

Nevertheless the Fortune 500 as a whole have been slow to respond to the opportunity. In a fascinating article in the Wall Street Journal, Don Tapscott, co-author of Macrowikinomics: Rebooting Business and the World, notes that in last five years the rate of business model innovation has not accelerated. Overall, the gains have been modest.

In the article, Tapscott offers to help out five struggling industries– big pharma, music, financial risk management, green manufacturing and health care—with interesting suggestions as to how they should rethink their business models. Today, let’s take a look at the big pharmaceutical companies, most of which have declining share prices over the last ten years...