The Power of Product Development Partnership

Sep 01, 2011

There used to be a perfect wave that Big Pharma could surf to a safe harbor of steady profits. It was the blockbuster drug, developed in shuttered, in-house labs using a rote process of mass chemical screening to treat chronic, clinically undifferentiated conditions requiring a lifetime commitment from patients.

Getty images: Bull’s Eye
No more. Today's safe harbor is just an accounting term, as companies scramble to create a new research model around something stronger than a conforming indication for the average patient. The irony is that a new precedent for success is today being forged around an old construct: the Product Development Partnership (PDP), where pharma pools its logistical and financial muscle with government, NGOs, and academia to commercialize treatments for the big diseases that still kill millions because traditional market incentives are skewed.

Interest in repurposing this model is growing precisely for the very reason it was created: to minimize market uncertainty in 'neglected' therapeutic areas that look unpromising from a standard ROI perspective. Says Jan Twombly, representing the the Association of Strategic Alliance Professionals (ASAP), "It's no stretch to say that market uncertainty is becoming a standard assumption in all areas of investigation. The future of the pharma business depends on showing a direct link between investment and outcomes, one where product development can progress because there is an unambiguous social return that resonates value." The point is that the PDP is not a one-off activity designed to fill a charitable or reputational gap, but instead a platform for addressing fundamental strategic changes in the way medicines are developed, priced, distributed, and promoted.

Industry certainly has a range of precedents to choose from. ASAP has more than 2,000 company members drawn from an array of industries, with life sciences constituting the biggest share. In pharma, 12 PDPs are now functioning in 17 therapeutic areas in 36 countries and involving the participation of more than 150,000 experts and patients through the conduct of clinical trials and other investigatory platforms. There were no PDPs in place a decade ago. The timeline means that a few of these early partnerships are beginning to bear fruit in the form of approval-ready products.