Wendy Mayer, VP of Worldwide Innovation at Pfizer presented this at the Health Hackathon at Cornell Tech on April 9, 2015 to the audience of Cornell, MIT, Harvard, and Weill students. #HealthHack2015

1. Dynamics Impacting the
Future of Healthcare
Wendy Mayer & John Cusumano
Worldwide Innovation & Business Technology
April 10, 2015

2. • ‘One size fits all’ medicines
• Office-based, primary care
physicians dominate the
value chain
• Shots-on-goal R&D model
• Fee-for-service treatment
paradigm
• Primary care and specialty
medicines
• Large and small molecules
• Organized payers, providers
dominate the value chain
• Evolution to evidence-based
medicine
• Precision medicine
• Real-world and evidence-
based information
complements clinical data
• Digitization of healthcare
information and dialogue
• R&D collaboration as a core
capability
The Biopharmaceutical Industry Continues to Evolve
Yesterday Today Tomorrow
2

3. Five Key Drivers That Are Shaping Healthcare and Pharma
Future of
Healthcare
Medical /
Scientific
Social
Technological
Political &
Economic
Demographic
3

4. An Aging Population and Growing Emerging Markets
Are Shaping the Demographics of the Future
The World’s Population Is Aging
at an Unprecedented Rate
Most of the World’s Population
Growth Is in Emerging Markets2
= 0.1B people
Developed
countries
Developing
countries
2013
2050
0
500
1,000
1,500
2,000
2,500
1950 1975 2000 2025 2050
(M) Population
Aged 60 or over1
• Stress on health and pension systems
• Greater emphasis on long-term geriatric care and late-life diseases
• Urban population and middle class growth will change market dynamics
Implications for the future
Sources: 1) United Nations; 2) The World Bank; 3) IMS Health audited sales data and Market Prognosis September 30, 2013.
4

5. Social Media and Consumerism Are Shaping the Future of
Healthcare
Consumers Are Using Social
Media for Health-related Matters
Expectations of Accessibility
and Quality of Health Services
Are Rising
Active Internet Searches may be
a Thing of the Past
• Patients will be empowered, involved participants
• New tools will continuously find and display relevant information
24%
29%
32%
42%
Other patients’ experiences
Health related videos / images
Health related consumer reviews
Family / friends health experiences
Recommended for YouConsumer
Forums
Consumer
Ratings Sites
Healthcare
Companies
Ratings
Agencies
Non-profit
Orgs.
Gov’t / State
Agencies
Implications for the future
Sources: 1) PriceWaterhouseCoopers “Social media likes healthcare” April 2012.
5
Social
Trademarks are the property of their respective owners and used for information purposes only

6. • Pool of partners and competitors is changing
• Mobile health and sensors will shift healthcare from episodic to continuous, vastly increasing the amount
of data to inform diagnosis and treatment
Big Data, Sensors Are Shaping the Technology of the
Future
The Use of Wearable Devices and
Sensors Is Rapidly Increasing
Artificial Intelligence & Cognitive
Computing Are Advancing
Data Companies Are Actively
Pursuing the Healthcare Ecosystem
21
170
2011 2017
Sources: 1) Mobihealthnews, “ABI research: 30M wearable sensors shipped in 2012”.
6
Implications for the future
CAGR:
49%
Trademarks are the property of their respective owners and used for information purposes only

7. • Prevention and precision medicine will increasingly be focus areas
• Breaking science will enable new types of therapies
• The ecosystem will operate in a more networked fashion requiring non-traditional approaches to business
development
Collaboration, Open Innovation, and Targeted
Treatments Are Shaping the Science of the Future
Declining Innovation Productivity
Has Led to Increased Collaboration1
New Medical Treatments Are Based
on Genetic and Molecular Tests
A Deeper Understanding of Disease
Pathways Is Emerging
0
10
20
30
40
50
60
2002 2004 2006 2008 2010 2012
Pharma Industry R&D Spending
NME Launches
Sources: 1) PhRMA 2013 Industry Profile, Thomson Reuters CMR International Pharmaceutical R&D Factbook, KMR analysis September 2012.
7
Implications for the future
Medical Science

8. Rising Costs Are Leading to Containment Measures
and Healthcare Reforms around the World
US Healthcare Spending1 Policy Makers and Payers Gain
Control over Prescribing Decisions
• Value and evidence based healthcare will be standard
• Value based on real world evidence not just clinical trial evidence
• Further consolidation of payers will increase their market power and facilitate greater transparency
Implications for the future
0
1,000
2,000
3,000
4,000
5,000
6,000
($B)
Physician
Pharmacist Patient
HTA Body Payer
Sources: 1) Centers for Medicare & Medicaid Services (CMS) “National Health Expenditure Projections 2011-2021”.
8
20% of
GDP

9. To Capitalize on These Drivers, Pfizer Developed a
Clear Strategic Path Guiding The Journey ahead
Fix the innovative core
and generate medicines
that profoundly impact
health
1
Create an ownership
culture
4
Make the right capital
allocation decisions to
maximize value and
enhance shareholder
return
2
Earn greater respect
from society
3
Our Purpose: Innovate to bring therapies to patients that significantly improve their
lives…
…we will deliver on Our Mission:
To be the premier, innovative biopharmaceutical company
Guided by the Four Imperatives…
9
9

10. Delivering Against Imperative #1
Fix our innovative core and generate
medicines that profoundly impact health

11. We’ve Transformed Our R&D Model to Deliver
Key Elements of Productivity
• Reduced R&D spend
• Focused in core areas
• Research Unit / Business Unit
collaboration
• Empowered Chief Scientific
Officers
• Centers for Therapeutic
Innovation (CTI)
• Development and
commercialization
partnerships
• Business Development
investments
• Precision Medicine
capabilities
• Bioinnovation hubs in
Cambridge, MA, San
Fracisco, CA, San Diego, CA,
and Cambridge, UK
Greater Focus & Rigor Strategic Externalization Differentiated Innovation
Quality of Output Probability of Success Speed Cost
11

12. Delivering Against Imperative #2
Make the right capital allocation
decisions that maximize value and enhance
shareholder returns

13. Deployment of Capital and Operating
Expenses to Highest Value Opportunities
• Advance the highest value R&D programs within defined budget
• Continuous improvement of Pfizer Global Supply to maintain competitive cost of
goods
• Drive operational efficiencies and commercial model transformation to increase
the value from every dollar spent
• Dividends and buybacks to deliver value to shareholders
Allocation of Vital Resources
13

14. Evolution of the Commercial Model
Recalibrating Pfizer’s Go-to-Market Model
Past
Rely on
High Fixed-cost
Field Force
Use a flexible mix of efficient channels,
increasing our digital capabilities
Focus Mostly
on Physicians
Engage with the entire healthcare
community to support quality outcomes
Communicate
Product
Information
Demonstrate evidence of value using
real world data and Big Data as well as
clinical trial data
Future
14
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15. mHealth trends
Global wearables
market to reach
by 2020
$25B

16. BEYOND THE PILL
Integrated products and services that
work across the care continuum to
engage patients/caregivers/providers
and deliver improved health outcomes.
Patient
Engagement and
Adherence
Making Products
Easier to Use and
Understand
Closed Loop
Monitoring
Digital
Therapies
g
Bigger graph, move
arrow right, shrink
text left, no
mHeALTH under
graph, DIGITAL
health, new icon for
digital therapy
Integrated products and services that
work across the care continuum to
engage patients/caregivers/providers
and deliver improved health outcomes.
Patient
Engagement and
Adherence
Making Products
Easier to Use and
Understand
Closed Loop
Monitoring
Digital
Therapies
BEYOND THE PILL

17. Delivering Against Imperative #3
Earn greater respect from society

18. What Is Corporate Responsibility?
Responsible
Research and
Development
The
Environment /
Sustainability
Governance
and Compliance
Product
Quality
Transparency
and Integrity
Access
To Medicines
…the way
Pfizer operates and is
held accountable for
conducting business
responsibly
18

19. Delivering Against Imperative #4
Create an ownership culture

20. Our ‘Ownership Culture’ Is Helping to Transform
Pfizer
Own the Business
Win in the
Marketplace
No Jerks… Let’s
Discuss Behaviors
Impact Results
Trust in
One Another
“I believe our culture can become a key sustainable advantage as we work to
make Pfizer the premier, innovative biopharmaceutical company.”
– Ian Read, 2012 Annual Review
20

21. ‘Dare to Try’ Program Approach
is about encouraging an entrepreneurial mindset, where all
colleagues are empowered to explore and test new ideas via experiments.
Embed
Capability
To foster a culture of
entrepreneurship that
goes beyond the
training and
workshops
Launch
Experiments
To accelerate
profitable growth
through ‘Dare to Try’
challenge workshops
21