Markers for Effective Collaboration
PHARM EXEC: What is most important in lining up a good partnership deal?
NEWELL: Understanding what motivates your potential partner is critical—responding to its business vision and therapeutic area needs.
Another is being able to explain succinctly what your product and technology does to help them, and to use mutual understanding
to start forging a more comprehensive, long-term relationship that can bear additional fruit over time.
BOWDISH: Another is looking further afield for opportunities. Big Pharma is no longer the only source for collaboration. Smaller pharma
companies—those reliant on a single product that generates just under $1 billion in revenue—are prime targets because they
are sufficiently resourced to take risk and need to tap new innovations. Their relatively small size makes them more flexible
in negotiation and it also helps them understand us more. Decisions come faster too.
XANTHOPOULOS: We also should consider the generational shift taking place in the CEO suite of Big Pharma. Many of the new CEOs are under
the age of 50 and are thus attuned to deals that can help repurpose these big companies for the long term. There is more interest
in deals that are game-changing or transformational. We at Regulus negotiated a licensing pact with GSK in which I represented
a company that at the time had two employees, including myself. Basically, GSK was cooperating with an entity that didn't
exist. It shows that when Big Pharma gets a mandate from the top and sees opportunity it can move fast.
BALTERA: We cannot ignore intellectual property (IP). The IP has to be bulletproof. And that adds to the product timeline because
here in the US it can take several years to apply for and register a patent.
NEWELL: Exclusivity can also be achieved in ways other than by having a patent. Being able to meet stringent regulatory standards
that others cannot, or possessing manufacturing capabilities not available to others, are some additonal ways to achieve exclusivity.
These can add to the partner's comfort level and allow for the realization of the full value of a product.
LICHTER: Negotiating IP with Big Pharma can be contentious. Lawyers are trained to find holes and to nix a deal that may be porous
because the end points are not always clear. The business judgment factor is downplayed. But as opportunities get scarcer,
I find potential partners are being more flexible on IP. There is no choice.
MCLOUGHLIN: I'd emphasize that Pfizer is looking carefully at how to improve deal-making as a process that captures the best assets of
all the participants. What's the best structure that will incorporate all these cited elements of a good deal? What can we
do to keep your teams active and incentivized to move things forward?