Breaking the Pharmaceutical Monopoly
Meet Dan Liljenquist:
Dan Liljenquist is the lead architect and Board Chair of Civica Rx. His also Senior Vice President and Chief Strategy Officer for Intermountain Healthcare, where he also oversees Intermountain’s Enterprise Initiative and Market Intelligence & Planning Offices. Prior to Intermountain, Dan served in the Utah State Senate. He is a former strategy consultant with Bain & Company, Inc. Dan received a bachelor’s in Economics from Brigham Young University and a JD from The University of Chicago.
Key Insights:
Dan Liljenquist knew the pharmaceutical industry needed to change. He helped establish a nonprofit drug company to reduce generic drug shortages and price gouging.
- Market Forces. Huge price increases on generic drugs are only possible under certain market conditions: there is inelastic demand, economies of scale are necessary for manufacturing, and only one manufacturer is required to meet market demand.
- Public Utility. For some drugs there is essentially a monopoly. Dan set out to organize the demand side of the equation into a monopsony, a purchasing monopoly. CivicaRx was created to be a non-profit drug company that acts like a public utility, providing hospitals with a consistent and cheaper supply of certain drugs.
- Asking the Right Questions. Dan sought out experts and “badgered” them with questions. After extended discussion and iterations on the core hypothesis, the business model and vision emerged. Dan advises entrepreneurs to learn everything you can about what inspires you.
This episode is hosted by Gary Bisbee, Ph.D. He is the Founder, Chairman, and CEO of Think Medium.
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