Pharma and medtech rarely collide. That might be the biggest miss in health care

There’s a strange paradox in health care right now.

We live in a world where every executive deck talks about “patient-centricity,” “precision medicine” and “better outcomes.” We talk about integrated care pathways and real-world evidence as if they’re already table stakes. And we talk about the future like it’s a connected ecosystem of therapies, diagnostics, data, devices and digital touchpoints.

But in reality, most of the industry still behaves like it’s 2005.

Pharma lives in one lane. MedTech lives in another. Diagnostics sit somewhere in the middle, quietly deciding who gets treated and who doesn’t, often without the strategic attention they deserve.

If we’re being honest, pharma and MedTech don’t just operate separately. They rarely even speak the same language.

And I think that’s a problem, not just for business but for patients.

The uncomfortable truth: “precision medicine” is mostly a marketing phrase unless diagnostics and devices are part of the strategy

The more I watch the health care landscape evolve, the more I believe this: the drug is no longer the whole product. The drug is one part of the product.

The rest of the product is:

• the diagnostic that identifies the right patient
• the workflow that gets that patient into treatment quickly
• the monitoring that tracks response
• the data that proves value to payers and systems
• the clinical infrastructure that makes adoption frictionless

That infrastructure doesn’t come from pharma. It comes from MedTech and diagnostics.

Yet we still behave like these are adjacent markets rather than mission-critical capabilities.

And that’s where the opportunity and the risk begin.

The companies that “collided” anyway — and what they understood early

There are exceptions. And they’re instructive.

Roche: the modern blueprint

If you want the cleanest case study of pharma and diagnostics actually operating as one strategic engine, it’s Roche.

Roche didn’t treat diagnostics as a side hustle. They treated it as an advantage, a way to shape markets, guide therapy adoption and accelerate R&D.

Their acquisitions across Ventana, Foundation Medicine and Flatiron weren’t random. They were a strategy: own the map, not just the vehicle.

Pharma companies spend billions fighting for share at the point of prescribing. Roche invested in the systems that influence who even shows up at the prescribing decision in the first place.

That’s not just convergence. That’s control.

Abbott: diagnostics as the front door

Abbott is another fascinating example because they’ve always been comfortable operating across devices and diagnostics, and now they’re going bigger.

Their acquisition of Alere expanded point-of-care diagnostic reach. But the bigger story is their announced $23B acquisition of Exact Sciences, which signals something more ambitious:

diagnostics isn’t a supporting actor in oncology — it’s the front door.

If oncology is the growth engine of modern health care, then screening and early detection are where the next market gets built. That’s not a device strategy. That’s a platform strategy.

J&J: the “platform acquirer” in MedTech

J&J is one of the few companies that has been structurally built for convergence. And what’s interesting is that their MedTech acquisitions aren’t cute.

They’re not “toe-in-the-water” deals.

They’re platform bets in robotics, cardiovascular intervention and procedure-enabling technologies, underscoring something many pharma companies still don’t fully appreciate: in health care, the procedure is often the product.

And the procedure is where patient experience, clinical outcomes and economic value all collide.

So why don’t more pharma companies do this?

This is the part of the conversation where people tend to give generic answers:

• “Different regulations”
• “Different timelines”
• “Different cultures”

All true.

But incomplete.

The real reasons are more structural, and more uncomfortable.

1) They don’t sell to the same power center

Pharma sells into:

• prescribing behavior
• payer access
• formularies
• guidelines

MedTech sells into:

• hospitals and IDNs
• procurement committees
• supply chain
• procedural economics
• service and training

In other words: pharma sells belief. MedTech sells workflow.

And workflow is brutally hard to disrupt.

2) Their margin physics are different, and leadership teams don’t like that

Pharma leaders are trained to pursue outsized returns:

• one asset can generate billions
• one indication can create a franchise
• one approval can reshape a company

MedTech tends to generate value differently:

• iterative innovation
• product lifecycle management
• service models
• training, adoption and support

It’s not worse. It’s just different.

But Wall Street has conditioned many pharma leaders to chase “pipeline math” instead of “platform math.”

3) Integration is hard, and most organizations aren’t built for it

Let’s say the quiet part out loud: most pharma org charts are not designed to integrate MedTech.

MedTech companies have field organizations that operate like elite operational units. They live in hospitals. They train clinicians. They troubleshoot in real time. They win by execution.

Pharma organizations are often optimized for:

• brand strategy
• evidence generation
• access and reimbursement
• lifecycle management

So when pharma buys MedTech, it often doesn’t know what it bought or how to run it.

4) Many pharma companies still think they’re selling “a drug”

This is the biggest issue.

Pharma thinks the product is the molecule.

But in modern health care, the product is the outcome.

And outcomes are increasingly driven by:

• early detection
• correct patient selection
• adherence and monitoring
• clinical workflow enablement

That’s not a molecule. That’s a system.

Here’s the twist: some companies ran away from convergence — and that’s instructive

Not every convergence story is a success story.

Strategic deconglomeration, simplifying around medicines, can be rational. Focus, clarity and operational simplicity matter.

But separation is not inherently a strategy.

It’s often a default.

And in a world moving toward precision medicine, value-based care and outcome-driven reimbursement, default strategies get punished.

If I were advising CEOs: three ways to “collide” without crashing

Convergence doesn’t require a megamerger. In fact, most of the time it shouldn’t.

But it does require intent.

1) Build a “companion ecosystem” strategy for top pipeline assets

Not a companion diagnostic check-the-box.

A full ecosystem:

• patient identification
• testing infrastructure
• turnaround time optimization
• clinical decision support
• adherence and monitoring

If you’re launching a precision therapy without this, you’re leaving adoption to chance.

2) Create joint commercial pods (pharma + MedTech DNA)

Hospitals don’t want 12 vendors and 12 workflows. They want outcomes.

Put teams together that can sell:

• the therapy
• the diagnostic
• the workflow integration
• the value story

Make it easier for systems to say yes.

3) Stop treating data as a byproduct — treat it as a product

MedTech generates real-world data at the point of care.

Pharma spends years trying to recreate those insights after the fact.

The companies that win will close the loop:

diagnosis → treatment → monitoring → outcome → learning → optimization

That’s not just health care. That’s a flywheel.

Final thought: the companies that win won’t be the ones with the best drugs — they’ll be the ones with the best systems

I’m not arguing every pharma company should become a MedTech company. That’s not realistic, and it’s not necessary.

But I do believe this:

The next generation of health care leaders will build businesses around systems of care, not individual products.

And systems of care don’t live entirely in pharma or MedTech.

They live in the collision.

So maybe the real question isn’t: “Why don’t pharma and MedTech work together?”

Maybe it’s: “How long can we afford not to?”

Mike J. Hennessy Jr. is the President and CEO of MJH Life Sciences.