The life sciences marketplace has been ripe for collaboration for the past decade, but new players, new technologies and new regulations are changing the space. Traditional life sciences companies are working together in new and exciting ways, bringing a variety of deal structures and new complexities into the landscape. Our Collaborative Transformation podcast episode “Driving the Deal: Life Sciences Partnership Opportunities, Pitfalls and Impact” with Emmanuelle Trombe and Gary Howes explores these issues in depth. Below are key takeaways from the episode, which you can listen to in full here.
It’s not just new players changing the space—it’s new approaches by traditional players. “It’s not only about pharma and biotech,” Trombe said. “We are seeing collaboration with health care players such as payers, insurers and providers.” Technology companies are also entering the space, bringing financial and philanthropic investments to the table. “People are still trying to do the same things, but they’re getting there in slightly different ways,” Howes said. Collaborations are also shifting from exclusive collaborations to more open collaborations, where partners are more closely involved in the product lifecycle, co-developing products and sharing technology, data and profits.
Bridging the gap between different industry cultures is crucial to building a successful collaboration. Product lifecycles and regulatory regimes vary across industries, but the gap between technology and health care/life sciences is particularly broad. “Life sciences health care companies looking at a lifecycle for their product is something like 20-odd years. That’s not the model that pure tech companies are used to,” Howes said. “There has to be some sort of realignment, so that both parties on either side of the collaboration understand each other’s business enough to make them a success.”
Data drives efficiency and efficacy in treatments, but the regulatory environment continues to present challenges to using it. Data collection is restricted in most countries, particularly for pharmaceutical companies and insurers, which makes it challenging to structure deals around data. Data regulations such as GDPR “could be a hurdle for the development of digital therapeutics, because they limit the ability to use the data collected in a meaningful fashion,” Trombe said. Overcoming these hurdles will be crucial to unlocking the potential solutions in medical data.
Competition is fierce in the life sciences market, so finding a clear competitive advantage is important for companies seeking a collaboration partner. This is particularly important for big pharma and biotechs—who need one another to drive innovation and develop new drugs. While the “hot” areas may change, “biotech has to be clear about what their asset is, what their drug target is and what differentiates them from the competition, because there will be competition,” Howes said.
Due diligence and simplicity are key for getting a deal done. Diligence should be done not only on your partner, but also on yourself, Trombe said. You need to have every stone turned and be able to address any gaps quickly. Failure to do so can undermine confidence in the deal. Once past the diligence stage, companies should take the time to negotiate deals that can be enforced. While life sciences deals have become more complex, that can be counterproductive. “The key words are: prepare, create good momentum and keep it simple,” Trombe said. “Remember that a deal is not done when signed, and a successful collaboration needs a very strong alliance management.”
Collaborations in the global life sciences market present exciting opportunities for pharma and biotech companies to outpace the competition and build new solutions to complex problems. Companies that keep the above issues in mind and build partnerships based on mutual understanding will be well positioned to move the industry forward.