Open Innovation in the Pharmaceutical Industry
According to Clare O’Neill,
Ph.D., founder of innovation consultancy, Original Ventures, open innovation is
a form of collective intelligence. O’Neill explains, “Those in companies who
are more connected have a higher risk of having a good idea. If you are
connected to people, then ideas can be challenged from multiple angles.”
As many big pharmas are
maturing they have become more akin to manufacturing organizations with less
internal innovation. This is where accessing science from academic centers of
excellence and SMEs can help, and delegates at the conference believe many
pharmas are now altering their business model and will increasingly access
innovation in drug discovery from external sources.
Vallance comments, “We have
pushed the externalization agenda and have many models of how it works. We’re
believers in harnessing external expertise because it is now crucial for our
business to progress. We have 10,500 scientists working for us worldwide, and
there is no way we’ll even have one percent of the good ideas in the world.
This is why we were keen to be involved in setting up SBC as the UK’s first
open innovation biomedical campus at our Stevenage site because it allows us to
have links with some of the highest caliber scientists in the world without
having them in-house.”
Vallance detailed that GSK now
has 42 discovery performance units, which are small teams of GSK scientists
focused on the discovery of medicines for specific areas of disease that are
operating an open innovation strategy. These are partnerships focused on
developing assets that are currently pre-proof-of-concept and include
in-licenses, option collaborations, technology deals and academic
collaborations, all ultimately focused on producing new molecules.
Early Adopters
A number of open innovation
successes were highlighted at the conference. O’Neill says: “Open innovation
leads to increasing success and early adopters such as Procter and Gamble have
seen their revenues increase twofold, and Eli Lilly is a strong leader in open
innovation with their current open innovation TB program.”
Duncan Judd, founder of drug
discovery services consultancy, Awridian, presented other good examples of
where open innovation is being utilized in drug discovery. These include the
development of 47 lead compounds to treat malaria which have come from open
access to the compounds and facilities at GSK’s site at Tres Cantos in Spain;
Shire funding a rare diseases R&D partnership with Italy’s TIGEM to the
tune of $22 million; the SGC at Oxford seeking to solve the structures of human
proteins of medical relevance and allowing their use without restriction, and
the MRC-AstraZeneca collaboration where researchers have access to 22
AstraZeneca compounds to potentially treat Alzheimer’s disease.
Open Innovation consultant
Stefan Lindegaard explains where he believes open innovation currently sits in
big pharma, saying, “96% of all product innovation fails, so this means around
2% of new products produce 90% of the value so you have to keep innovating.
Procter and Gamble started their open innovation program 12 years ago; now they
are so used to working in teams where there is an external element that they
just call it innovation. In seven years time in pharma it will be the same,
where open innovation will become systematized and strategic in many companies,
and those that don’t do this will struggle.” Lindegaard adds, “Small companies
are roadkill and they have to be entrepreneurial to survive, it is only the
large pharmas that can afford to do the innovation because their size provides
some protection should certain approaches fail. This is why open innovation
needs to be part of the toolbox for big pharma.”
The Other Side of the Coin
It is clear that open
innovation does have a number of benefits for big pharma but what’s in it for
academic scientists? Christine Martin, Ph.D., manager, drug discovery, at
Cambridge Enterprise, the technology transfer company of the University of
Cambridge, explains why some groups at Cambridge want to locate at the open
innovation, SBC campus: “We help researchers convert their validated targets
from aspirational to de-risked, investable assets. Many academics appreciate
how challenging the transition from target to drug candidate can be; so what we
are doing is identifying those research groups that would benefit from access
to drug discovery expertise by co-location with industry at the SBC. Through
their Scinovo group, GSK is happy to help because at this stage the assets are
pre-competitive.”
Martino Picardo, Ph.D, CEO of
SBC, continues, “Several groups at the University of Cambridge want to be here,
as their scientists need access to GSK's drug discovery expertise, as well as
that of Scinovo, the organization within GSK that provides consultancy in that
area. Our open ecosystem here also provides state-of-the-art facilities and
equipment that academics and small companies would not otherwise be able to
access.”
A Shift in Perceptions
A culture of open innovation
seems to offer a number of advantages in terms of cost reductions, access to
new ideas, and crowd-sourced funding, yet many speakers at the conference
stated that its adoption has been slower in big pharma than other industries.
O’Neill says, “Open innovation is not a panacea but is underutilized in this sector
and opportunities are being missed.” Some cited the fact that open innovation
projects sometimes come up against the ‘not invented here syndrome’, where
employees are less willing to engage with external partners. According to
panelists at the conference, to overcome this mindset, their firms have
systematized open innovation more rigorously with targets that reward staff
when they deliver projects which have utilized an open innovation element.”
Another issue cited was
intellectual property rights. Vallance explains, “All our 13,500 compound hits
against the malaria parasite are in the public domain and this caused an
interesting reaction from our lawyers as they believed we were throwing away
our IP.” He adds, “Our biggest challenge now is overprotection of IP,
especially in the university sector because it is more restrictive than is
appropriate. Tech transfer offices overvaluing ideas could become a problem for
open innovation if it continues.”
A knock-on effect has been
that funding of projects with open innovation elements is sometimes more
difficult to access, especially in Europe. Vallance comments, “VCs in the U.S.
are changing, and they are happy to own a part of something rather than the
whole. I’m not sure we’ve had that shift of thinking with the VCs in the UK. I
think they need to ask themselves if they want to own 100% of something that is
diminishing or to own a bit of something that is growing.”
Where to Now?
With the blockbuster model in
pharma now becoming unsustainable and expensive drugs not being reimbursed, it
is clear that big pharma has got to be creative and decrease the amount of
money spent developing those drugs. Open innovation looks set to continue being
a popular strategy for potentially reducing these costs. O’Neill concludes,
“The train has left the platform and is moving. It is 10 years since early
adopters begun their open innovation programs and it is those pharma companies
where open innovation becomes an attitude rather than a process which will reap
the rewards in the future”.
Fuente: GEN
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