The Biopharmaceutical Board Evolution

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+ 3 authors
March 01, 2024
10 min read
Next Generation BoardsHealthcarePharmaBoard and CEO AdvisoryBoard of Directors
Executive Summary
Boards in the biopharma space have evolved significantly since 2015. Here’s where they’re headed—and what that means for leaders.
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Between 2015 and 2023, biopharmaceutical boards have undergone a significant shift in their make-up. While the average number of board members has remained consistent (~13), turnover was 74%.  This has presented biopharmaceutical boards with the opportunity to introduce talent with new capabilities and fresh perspectives that help them stay at the forefront of innovation and operational success. 

As the biopharmaceutical market continues to weather massive change, the ideal board must find an optimal balance between continuity and new expertise, with incredibly accelerated technology shifts, such as AI’s proliferation (with its application in everything from R&D to supply chain to commercial launch and customer insights), demanding requisite increases in the tech “literacy” of boards. 

To better understand the biopharma board evolution, Russell Reynolds Associates analyzed the board membership of public global biopharma companies with an average market cap greater than $50 billion over a period from 2015 to the end of 2023. This timeframe was chosen to allow for a significant turnover of board membership, as our prior research showed this to be longer than the average tenure of a global biopharma board member. Overall, these boards have become more diverse in both their professional backgrounds and identities and are better equipped to handle the challenges facing the biopharmaceutical industry today. Specifically, we found that:

  • CEOs remain in high demand, while commercial leaders’ popularity is on the rise: While there has been a slight decline in individuals with CEO experience on biopharma boards from 2015 to 2023, non-CEO commercial leaders (i.e. CCOs or ExCo-level BU and Divisional leads) increased their board presence from 15% to 21% over the same period.
  • Dramatic increases in tech backgrounds on biopharma boards since 2015: There has been a dramatic 331% increase in the percentage of biopharma board members with technology backgrounds since 2015. 
  • Board members’ scientific expertise has shifted to reflect industry trends and therapeutic area priorities: Where individuals with generalist academic medicine backgrounds have declined, board members with (academic) oncology expertise saw a 118% growth in representation.
  • Biopharma boards are diversifying: Overall, the biopharma boards we analyzed are currently comprised of 50% women and underrepresented minorities, increasing from 36% in 2015. Women directors, in particular, have made gains, growing from 22% of seats in 2015 to 36% in 2023.

 

CEOs remain in high demand, while commercial leaders’ popularity is on the rise

While there has been a slight decline in individuals with CEO experience on biopharma boards from 2015 to 2023, non-CEO commercial leaders (i.e. CCOs or ExCo-level BU and Divisional leads) increased their board presence from 15% to 21% over the same period (Figure 1). 

Individuals with CEO experience continue to be the most sought-after biopharma board members for their strategic acumen and enterprise perspective. However, commercial leaders have experienced a notable surge in board presence, increasing their representation to 21% in 2023. This increasing emphasis on commercial leadership reflects the industry’s recognition of the critical role that these professionals play in navigating the complex market dynamics and driving the most successful product commercialization strategies, which in turn are key to achieving long-term business success and delivering innovative treatments to patients.

 

Figure 1: Biopharma Board Composition by Experience, 2015 vs 2023

Change in Biopharma Board Composition by Experience

Source: RRA analysis of public global biopharmaceutical companies with average market caps over $50 billion,  n= 171 board members (2015) & n = 177 board members (2023), 2015-2023.

 

Dramatic increases in tech backgrounds on biopharma boards since 2015

There has been a dramatic 331% growth in the percentage of biopharma board members with a tech background since 2015.

Directors with finance backgrounds continue to comprise the greatest share of non-science and pharmaceutical capabilities on biopharma boards (Figure 2). However, biopharma boards have experienced a remarkable composition transformation over the past few years, with technology expertise being the greatest growth area. In 2015, only 36% of boards studied had at least one member with a substantial technology background. This increased to 79% of boards by 2023. 

As digital innovation continues to revolutionize drug discovery, clinical trials, and patient engagement, the demand for tech-savvy expertise on boards has intensified. By integrating leaders with strong technological acumen, biopharma companies are better equipped to harness the power of data analytics, artificial intelligence, and digital health solutions to drive efficiency, enhance research capabilities, and optimize healthcare outcomes, ultimately benefiting patients.

 

Figure 2: Composition Change in Biopharma Boards for Finance and Technology Profiles

Change in board composition regarding Finance and Technology profiles

Source: RRA analysis of public global biopharmaceutical companies with average market caps over $50 billion,  n= 171 board members (2015) & n = 177 board members (2023), 2015-2023.

 

Board members’ scientific expertise has shifted to reflect industry trends and therapeutic area priorities

 

With a 

118% 
growth in representation, board members with academic oncology expertise have seen an increase, while individuals with generalist academic medicine backgrounds have declined

Alongside broad technological development, biopharma science and R&D progress continues to unfold at an astonishing pace. Beyond the relatively recent scientific advancements in fields such as immunotherapy (which the industry has already harnessed to develop life-changing therapies), new scientific tools and platforms, including CRISPR (which has had its first approval in late 2023) and mRNA (beyond its use in vaccines during the pandemic), continue to present significant opportunities to innovate. It is therefore not surprising that biopharma boards have maintained their focus on recruiting new board members with scientific pedigrees and/or pharmaceutical sector experience. On this front, Boards saw a modest increase in members from 37% in 2015 to 40% in 2023.

However, when looking more closely at the precise scientific domains of these board members, we observed a notable shift. While backgrounds in biopharma industry expertise, broad academic medicine, and oncology remain the dominant phenotypes, there has been a change in their relative proportions. Where individuals with generalist academic medicine backgrounds declined, board members with oncology expertise saw a 118% growth in representation. This shift naturally reflects a strategic realignment of biopharma boards’ expertise to match emerging trends and priorities within the scientific landscape. 

By evolving the board’s composition to mirror these changing dynamics, organizations demonstrate their commitment to robust scientific representation at the board table, ideally increasing the likelihood of making the right scientific investments. It remains to be seen if the therapy areas that have been experiencing a renaissance over the last several years, such as neuroscience and cardiometabolic, will be reflected at the board-level in the future, but we anticipate some evolution in this direction. 

 

Biopharma boards are diversifying

Overall, the biopharma boards we analyzed are currently comprised of 50% women and underrepresented minorities, increasing from 36% in 2015. Women directors, in particular, have made gains, growing from 22% of seats in 2015 to 36% in 2023 (Figures 3 and 4). 

Biopharmaceutical boards have made meaningful strides in enhancing gender diversity within their ranks—but there is still room for improvement. This trend reflects a deliberate and proactive industry-wide approach to address the historical underrepresentation of women and minorities in senior leadership and board positions. The recognition of the value that diverse perspectives bring to decision-making processes has spurred efforts to attract and empower diverse board members and foster an environment that encourages innovation, drives inclusive strategies, and paves the way for sustainable growth in the healthcare landscape. 

 

Figure 3: Change in Women’s and Underrepresented Minorities’ Representation on Biopharma Boards, 2015 vs 2023  

Change in Gender Diversity of Biopharma Boards

Source: RRA analysis of public global biopharmaceutical companies with average market caps over $50 billion,  n= 171 board members (2015) & n = 177 board members (2023), 2015-2023.

 

Figure 4: Change in Women’s Representation on Biopharma Boards, 2015 vs 2023

Change in Gender and Ethnic Diversity of Biopharma Boards

Source: RRA analysis of public global biopharmaceutical companies with average market caps over $50 billion,  n= 171 board members (2015) & n = 177 board members (2023), 2015-2023.

 

*Note that boards of companies headquartered in regions where the collection of diversity data is restricted were excluded from this analysis.

 

What’s next for biopharmaceutical boards?

As the biopharma industry navigates arguably the most transformational period in science and technology in human history, boards in this space have simultaneously evolved, diversifying their composition in terms of both expertise and identity. As these changes are likely to continue, boards should ensure they are aligned on how to move forward.

Biopharma organizations should continue to focus on market trends and the necessary skillsets, given the future regulatory climate.  To that end, as companies ramp up and redirect R&D spend into new therapeutic areas, boards should consider adding members with experience in domain areas like neuroscience and cardiometabolic. Additionally, as the regulatory landscape becomes more complex, commercial expertise in multiple geographies will be of ever greater importance moving forward. 

Boards that embrace new technologies, like AI, will be ahead of the curve. While we have seen a surge in board members with tech backgrounds, few have specific AI expertise, although this in part reflects the fact that AI is still in its infancy, especially at the enterprise-impact level for many industries. The AI revolution will require upskilling and reskilling across organizations – including at the board level – and biopharma companies should begin planning now to ensure they are prepared for AI's rapid impact across the R&D, manufacturing and commercialization ecosystem. 

Lastly, as boards work to achieve gender parity and improve the underrepresentation of ethnic minorities, board should renew their focus on sustainability in tandem. While all the boards we evaluated are well on the road to gender and ethnic parity, only 36% of the boards we observed have a committee dedicated to sustainability. Further, according to RRA’s Divides & Dividends Report, only 44% of all healthcare C-suite leaders say that their organization has a sustainability strategy that has been clearly communicated and acted upon. It appears that biopharma companies are just beginning to understand the value that sustainable business practices can bring to their organizations—and the world around them—and therefore start to move beyond the initial impetus to address sustainability from more of a brand management perspective. Leaders within the biopharma space who prioritize sustainability will be at the forefront, particularly in addressing issues of health equity and access, supply chain emissions, and pricing.

In summary, biopharma companies who are attuned to industry, technology and societal changes and demands, and who appropriately reflect these in their board composition and evolution will, in our opinion, establish a clear competitive advantage, which will benefit shareholders and patients alike.

Authors

  • Patrick Mooney co-leads Russell Reynolds Associates’ Global Biopharma practice. He is based in London.
  • Cameron Findlater is a member of Russell Reynolds Associates’ Healthcare Knowledge team. He is based in New York.
  • Dana Krueger is a member of Russell Reynolds Associates’ Global Biopharma practice. She is based in Amsterdam.
  • Gabrielle Lajoie is a member of Russell Reynolds Associates’ Global Biopharma practice. She is based in San Francisco.
  • Peter Levin is a member of Russell Reynolds Associates’ Global Biopharma practice. He is based in Copenhagen.
  • Yvonne Lu co-leads Russell Reynolds Associates’ Global Biopharma practice. She is based in San Francisco.
  • Emily O’Shea is a member of Russell Reynolds Associates’ Board and CEO Advisory practice. She is based in London.