CEOs Share Their Outlook for 2023

I had the privilege of co-moderating, along with my colleague, Rich Lesser, Boston Consulting Group (BCG)’s Global Chair, our annual virtual “CEOs on the Future of Healthcare” session during the J.P. Morgan Healthcare conference week. Our guests, Joaquin Duato, Chairman of the Board and CEO at Johnson & Johnson, and Dr. Bernd Montag, CEO of Siemens Healthineers, shared their thoughts on the conference and their outlook for the year ahead. It was an engaging and inspiring discussion.

Driving Innovation

J&J has always ranked high on the lists of most innovative companies, including in 2022. Joaquin said that investing in R&D is crucial for sustaining that level of innovation. J&J is one of the biggest R&D investors across all industries. J&J has a different organizational approach to innovation: end-to end therapeutic areas that allow deep focus on diseases and pathways; innovation centers; a network of incubators; and an internal VC fund, all driven by talented employees who are passionate about health care. But since great ideas can come from anywhere, Joachim said, “companies need to remain humble” and embrace partnerships.

Bernd described how Siemens Healthineers is looking at ways to do precision medicine at scale. They are focusing on the “triangle of patient twinning, precision therapy, and digitalization and AI.” Patient twinning is the vision of having a digital “copy” of a patient’s situation; precision therapy is enabling a technology-led intervention that is more precisely tailored to the patient’s need; and AI enables these two concepts.

Siemens Healthineers is a leader in the field of AI-based medical images, with a curated data lake of 1.5 billion medical data sets (images with diagnosis) and a supercomputer. They can do a CT scan of a tumor and search the dataset with AI to support finding the right treatment for the patient while sparing the surrounding tissue. And they can do this faster and better than what humans can do on their own.

Joaquin reminded us that scientific progress is a long road that requires patience, with the recent approval of a new Alzheimer’s drug being a great example of something the industry has worked on for many decades. Tremendous progress has been made in new modalities, such as cell and gene therapies, and in using AI for diagnosis and treatment. “We can advance healthcare more in the next decade than in the last 100 years,” he said.

Ultimately, innovation comes down to people, the talented and passionate individuals who are willing to go the extra mile. It’s a team sport, where combining different kinds of expertise — biologists, chemists, data scientists, and engineers — is critical for creating more differentiated products.

Health Equity: Driving Broader Access

Health equity is a mainstream topic —it’s no longer just the responsibility of the ESG team. Addressing health care disparities is critical for improving patient outcomes and reducing societal costs. For Bernd, “being able to develop innovations that everyone has access to is one of the most rewarding parts of innovation.”

J&J is making contributions in three areas: diversifying clinical trials, educating frontline healthcare workers, and contributing to global public health, especially in diseases such as MDR tuberculosis that disproportionately affect lower resource settings.

Building Resilience in the Face of Macroeconomic Headwinds

The macroeconomic challenges of war, inflation, and high interest rates made 2022 a particularly challenging year for health care. In Bernd’s view, companies are moving from coping with their environment to shaping it. He pointed out that healthcare innovations timelines are longer than most crises in the global economy, so persistent focus on the long term is critical. It’s also important to build core capabilities internally to reduce their dependence on other companies.

One of the key lessons from 2022: supply chain resiliency is essential. “We need to get to all customers 100% of the time,” Joaquin said. J&J is leveraging technology to monitor and manage the supply chain and inventory and reflected on balancing the need for global supply networks to optimize capabilities and costs, with the need to ensure resilience from geopolitical risks though regionalization.  

While both CEOs remain optimistic that the macro environment will improve in 2023, they believe that their organizations have become more resilient and more agile, which will serve them well in any environment.

To hear more, watch the interview here .