Another R&D model sea-change?

Recently, GlaxoSmithKline announced a “new” approach to drug discovery through a series of “long-term partnerships” with “academic superstars”.*   The first of these  was signed with Prof. Mark Pepys, head of medicine at the Royal Free and University College Medical School in London.   He was recently recognized by GSK with their “GlaxoSmithKline Prize” in 2007 “for his excellent work … identifying specific proteins as new therapeutic targets and developed novel drugs with potential use in amyloidosis, Alzheimer’s disease and cardiovascular disease”.  This builds on his decade long role as director of the University College London Centre for Amyloidosis and Acute Phase Proteins. 

Other blogs have erupted with comments and rancor because of an unfortunate comment that “big Pharma is useless at discovering new drugs and has to get its ideas from somewhere else”.  This is unfortunate in that it was taken as an insult to smart, hardworking individuals that have been striving to keep the industry afloat with new ideas and candidates against horrible diseases.   However, as reflected in my most recent post, we have recognized that “uselessness” for years. (see “R&D Laments“.)   This quickly follows recent comments from GSK suggesting it might be a media finesse, or a new corporate “smoke and mirrors” dodge now that mergers have been discredited for that purpose.  However, this may reflect a valid sea-change, similar to those I periodically post on, with reasonable risks and rewards.  One that also reflects a new reality for firms that would formerly have mandated Prof. Pepys to leave academia and to become a  GSK employee.  History has shown many such “superstars” being enjoined, “devoured’ in this manner for decades.  The shortfall of innovation supply vs. needs (demands)  of Big Pharma is altering the negotiation power typically held by corporations. 

My point is this, and it is consistent with the urgency for improved R&D Returns by seeking sea-changes to change business-as-usual:  There remains a need to spread risk out, with one path being  contracting with academia.  However, there is also a “race for the gold” for  the best approaches to really address complex conditions like Alzheimer’s, cancer, aging, Parkinson’s and the like.  And like it or not, some teams are indeed “superstars” in their depth and breadth in one of these specific areas (perhaps several per disease arena.)  So locking up Prof. Pepys is perhaps smart business, and yet it had to be done in a different manner than in the past due to the shift in power I mentioned, along with how to manage the “new decentralized R&D”, addressing how intellectual prowess is distributed globally.   Finally, I wonder if some of GSK’s own research uncovered a new understanding of the best risk/reward path on amyloidosis that mapped to Pepys’ research.  Hence, buy out and lock out competitors.   And this might be far less expensive than buying out a small biotech with comparable portfolios.

This also reflects what I have seen in clients that recognize that innovation limited to internal resources (regardless of R&D budget) will not be enough.  Besides board-announced shifts in strategy or model/organization, they are working to be the best collaborators with wherever expertise or “superstars” might live.  As with the surge in biotech alliances ten years ago, the winners will be partly determined by luck, but more and more winners will be those that work to be the very best operationally within this new model of decentralized R&D.

Lessons: 

  • Internally-sourced innovation cannot suffice to address remaining complex conditions.  The locus of power and “IP gold” has shifted
  • Firms CAN use their current IP to identify the best external avenues or “gold” to collaborate with, and to “lock it up” away from competition
  • Those that arrange their organization, process and technology to facilitate secure, but facile collaborations will win a majority of limited “superstar” resources

* – the original FT article is here:  http://tinyurl.com/GSK-pepys

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One Response to Another R&D model sea-change?

  1. Rick wobbe says:

    GSK (including Glaxo and Glaxo-Wellcome) has put more effort than most other major pharmas into tinkering with their R&D structure over the past decade or so. It’s good to see them trying new things, but I think they need to take some ritalin and stop tinkering for a while in order to give something a chance to work.

    Although there’s a tendency to view this as a new, breakthrough approach in drug discovery research, it is in fact very, very old. In fact, the pharmaceutical industry got started through productive collaborations between renowned scientists devoted to fighting disease (Ehrlich, Domagk, Waksman to name just a few) and companies e.g. Bayer, Merck). The biggest contrast I can see is that, in the “old model”, the famous academic scientist would say kookie stuff like “Would you patent the sun?” to explain their indifference toward patenting their discoveries, whereas today’s academics (and especially their respective institutions) are very aggressive about seeking patents and profits. I am unconvinced that this new type of relationship, in which the academic researcher is cast in the role of profit center for the university, and negotiates and conducts his/her research as such, will prove to be better for innovation than the old model.

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