A large proportion of life science companies believe the high cost of new drug development is among the emerging themes that will have the greatest negative impact on the sector in the next 3 to 5 years, according to global Life Science Risk Report 2024 published this week by WTW.

This is leading to an increased focus on finding novel use cases for existing drugs, as firms seek to launch new products and expand their international footprint.

The survey also revealed that regulation and reputation risk have risen to the top of the life science agenda as companies feel pressure on a range of issues such as increasing regulatory activity post-Covid, US drug price controls, rising data privacy concerns, ESG reporting requirements and product contamination. Changing or increasing regulation was named by 53% among their top external risks, up from 39% since the 2022 survey, while reputation was cited as a top risk both internally (47%) and externally (41%).

“After the turbulence of the last few years, the sector is returning to traditional business priorities with companies looking to launch products and expand into new markets,” said Edward Hunter, life science broking leader, WTW.

John Connolly, life sciences leader for North America at WTW added: “But, as they do so, the risk profile of the sector is changing. New smart technologies, while increasing production efficiency, are creating more exposure to risks like data breaches and intellectual property infringements. Global instability and supply chain changes, coupled with increasing regulatory and reporting requirements, are adding to the complex risk landscape. Firms need to be aware of weak points in their risk management processes and remember that these new risks and liabilities might require bespoke cover.”

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