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<v ->I am Chrissy O'Brien.</v>

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I'm a senior partner at BCG,

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and I have the distinct honor

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of being our moderator this morning.

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Joined on stage with an all-star group

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of healthcare executives

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to discuss a very exciting topic around innovation.

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What are you most excited about?

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What do you think the opportunities

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will be from an innovation perspective?

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<v ->We've heard terminology, "the golden era</v>

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of innovation in healthcare."

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I really think that that's the case.

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On the biopharma side,

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precision medicine remains top of the list.

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RNA technologies, both in terms of generating proteins,

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also silencing proteins.

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On the services side, AI and ML,

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alternate-site care, digital care, very exciting.

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And then on the devices side,

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sort of AI/ML-driven product ecosystem, the product suites.

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<v ->The innovation cycle is going to hit healthcare</v>

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like a truck, and it's going to make a huge impact

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on patients' lives.

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<v ->The pace of change of innovation,</v>

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I think has gone through a sort of step function

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over the course of the last five years.

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And this convergence with technology

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is having a profound impact upon medicine

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in every single aspect of the spectrum that we look at.

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<v Speaker>Healthcare companies spent 2023</v>

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understanding the potential of AI.

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In 2024, they'll focus on implementation.

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<v ->What AI and ML is going to help us do,</v>

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it's going to help us with efficiency, and it's

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going to help us bring high-quality medicines faster.

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We talk about target identification.

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Also within making chemical matter,

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having the tools to more quickly get to the composition of

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matter that you want to get to is going to be so critical.

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<v ->80% of the challenge of bringing AI</v>

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to a new therapy is wrestling with the data

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and getting it labeled and organized and curated,

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and dealing with the appropriate care of who has permissions

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to use the data, and being careful about protecting

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and ensuring the privacy of patients.

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<v Speaker>GLP-1 medicines have shown potential</v>

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that goes far beyond weight loss.

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<v ->As we think about the GLP market, the weight,</v>

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we've been thinking about the market will carved up.

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It's a comorbidity with weight loss.

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We have a product that we're bringing in for

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NASH with obesity.

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And so I think you'll see this theme

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just kind of carved up into different diseases.

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And then I do think the reimbursement will catch up

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as you have the hard clinical outcomes

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and the long-term data to go along with it.

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<v Speaker>The Inflation Reduction Act</v>

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has created a new set of challenges for biopharma companies.

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<v ->You have such a high fail rate in this business,</v>

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the capital in terms of large trials that you're spending.

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Now you have to ask yourself,

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How many of these trials you have to bring forward

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from day one?

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It impacts the way you fund,

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it has a knock on effect on maybe other trials

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that you're thinking about for other molecules.

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As the IRA becomes real,

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you'll see a market correction on

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especially those with small molecules

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because the biotechs don't have the luxury

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to prosecute like a big pharma.

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<v ->It's strategically very important for biotech companies</v>

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to think about this, because again,

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it may change their strategies on partnering clinical

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trialing and capital allocation.

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<v Speaker>2024 Will be a busy one</v>

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for mergers and acquisitions.

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<v ->Financial conditions are easing.</v>

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The big companies want and need growth.

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This allows for more transactions.

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<v ->Innovation happens not just inside our own walls,</v>

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but it happens a lot in other startup companies,

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other technology companies.

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So we're being very disciplined about evaluating those

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for potential tuck-in acquisitions.

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<v ->The patent cliffs for many of our peers,</v>

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they're still in a window

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where they're going to have significant patent cliffs,

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so there's going to be a desire and need

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to bring in high-quality late-stage compounds.

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<v ->The market this year is going to continue</v>

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to be quite challenging from a private equity standpoint.

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It's partly because you've still got

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relatively high interest rates.

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I think you are going to see

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some more bespoke solutions arising

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where people have got specific targets or assets in mind

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where they want to bring in a partner

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to create a win-win situation.