As drugs, devices and other healthcare products become more innovative and complex, and as development costs increase, working collaboratively becomes more important. By working with collaborators, companies can: [1]
· Avoid duplication of research
· Access resources such as technologies, platforms and equipment
· Access people with specific expertise, such as regulatory skills and research experience
· Source early-stage innovation or late-stage products for the market
· Share costs, data and results
· Move through development more quickly, efficiently and cost-effectively
As an example of the power of collaboration, by working together in ‘Project Light Speed’, Pfizer and BioNTech developed a successful COVID-19 vaccine in just nine months. The vaccine was based on BioNTech’s messenger RNA (mRNA) technology, which the two companies were originally developing for a flu vaccine. The R&D teams worked together on a number of vaccine candidates, while Pfizer created a manufacturing process in parallel. The manufacturing process was supported by collaborations with a number of contract manufacturing organisations (CMOs). [2]
The main types of partnerships and collaborations are: [3]
· Mergers and acquisitions
· R&D collaborations
· In- and out-licensing agreements
· Outsourcing agreements
· Industry-academia collaborations and spinouts
· Public-private partnerships
Mergers and acquisitions
Mergers and acquisitions (M&As) allow companies to access pipelines and technologies, particularly in areas of unmet medical need, as well as to share costs and knowledge. Similar sized companies may merge to pool resources and save costs through economies of scale.
During 2023, the top ten M&A deals totalled $115.8 billion, increasing from $65 billion in 2022. The largest was Pfizer’s merger with Seagen, a cancer biotech. The agreement was worth around $43 billion, and gave Pfizer access to Seagen’s antibody-drug conjugate (ADC) technology. [4, 5]
Companies need to be aware that M&A deals can negatively affect early-stage innovation as a result of a decrease in R&D expenditure and a loss of expertise. [6] Understanding this risk should be part of the M&A process.
R&D collaborations
R&D collaborations, including joint ventures and co-development agreements, allow companies to pool resources and reduce risk. Despite the country’s success in innovative drug research there has been a decline in creating drug discovery startups in Japan. To meet this need, in April 2024, Takeda Pharmaceutical, Astellas Pharma and Sumitomo Mitsui Banking signed a $3.9 million deal to create a joint venture that will incubate early drug discovery programs (mostly Japanese) and create potential therapeutics. [7]
Co-development agreements allow larger companies to access early- and mid-stage products to increase their pipelines. They also mean that smaller companies can receive funding for future R&D as well as get support and gain expertise as they take products through development. The larger company may have the option to acquire the assets later in development. In December 2023, SystImmune and Bristol Myers Squibb signed a deal for the EGFRxHER3 bispecific ADC, BL-B01D1, currently in a Phase I trial for the treatment of non-small cell lung cancer (NSCLC). SystImmune will retain rights in mainland China and BMS will have exclusive rights in the rest of the world. BMS’ goal for the agreement is to strengthen its oncology pipeline. [8]
In a more unusual deal in July 2023, Flagship Pioneering and Pfizer agreed to both invest $50 million upfront in order to co-develop 10 single-asset programs based on Flagship’s ecosystem of more than 40 hum...
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