Research and Development in Pharma: 4 Lessons in Change

October 18, 2013
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This is the eleventh blog post in a twelve part series that transforms ideas from the marketing world at large into practical plans for pharmaceutical marketing in the time of health care reform.

research and development in PharmaChange in Pharma is possible.

This is the eleventh blog post in a twelve part series that transforms ideas from the marketing world at large into practical plans for pharmaceutical marketing in the time of health care reform.

research and development in PharmaChange in Pharma is possible.

To become a believer, you only need to explore what is happening in R&D organizations across the country. After the lost decade of drug development where too much money was chasing too few good opportunities, big pharma R&D has shaken up drug development. Gone are the large evergreen budgets. Gone is the stovepipe R&D organization that operated independently of any commercial considerations.

In May of this year, I attended Convergence East, the Life Sciences Leaders Forum held on in Cape Cod, Massachusetts where, extrovertic, was a sponsor. A good portion of the attendees were from the big pharma R&D organizations, including Astra Zeneca, J&J, Millenium and Sanofi to name a few.

Big pharma R&D is using four key strategies to bolster their R&D productivity:

  1. Looking outside for solutions: No more navel gazing for pharma R&D. When asked about what percentage of their drug development efforts were external versus internal, the answer ranged from 30-50%.  To paraphrase a representative from Shire R&D, “the NIH mentality is not going to cut it anymore, too much money and personnel.”
    • This external focus also involves importing leadership that infuses a more entrepreneurial spirit into their organization. For example, Sanofi has hired  biotech executives like Katherine Bowdish, Vice President, R&D on board. Prior to Sanofi, Ms. Bowdish worked at companies like Permeaon Biologics and Alexion Pharmaceuticals, successful biotech companies.
  2. Convening diverse perspectives. J&J has set up four innovation centers around the world designed to create relationships in integrated communities of academics, research institutions, early stage biotechs, venture capital and entrepreneurs. The remit of these innovation centers spans J&J’s three business units: pharmaceutical, consumer and devices. The goal is for J&J to become the partner of choice when there is an opportunity to be commercialized.
  3. Investing further upstream: Sanofi is investing in early stage high-risk opportunities that can use Sanofi assets in the process. One of Sanofi’s earliest success stories their partnership with a prominent Harvard professor, Dr. Gregory Verdine, to create Warpdrive bio. Warpdrivebio has a proprietary “genomic search engine” to identify “powerful drugs that are now hidden within microbes.”
  4. Customer focused development: Drug development is no longer a purely academic exercise. For example, to better focus its R&D investments, Cubist takes their scientists into operating rooms with their surgeon customers. Deborah Dunsire, CEO Millennium, spoke about innovation as beginning with the patient; about reverse engineering what is wrong with the patient, focusing on the patient’s unmet medical need and determining what solution would make the biggest impact on the patient’s life?

The same laser focus on innovation must make its way to the commercial side of the business. Change in the commercial model needs to occur everywhere—from reorienting the rabid focus on the physician at the expense of payer and patient marketing to creating new definitions of a pharmaceutical “product” offering. Think about patient marketing, do we really need more branded commercials running on the evening news?

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The core idea to extrapolate from these R&D reorganizations is to turn to outside institutions, experts and customers to provide a fresh perspective on your business challenges So here are a few thought starters about how to export these R&D strategies and pump more innovation into the commercial model.

  1. Start from the patient. What are the upcoming changes in how patients consume media, search for healthcare information, pay for healthcare and use healthcare products and services? Once you have a “vision of the future state,” you can start to think about potential solutions.
  2. Gather a group of innovative thinkers from outside of Pharma and let them take a whack at some of your biggest issues. Convening thinkers from various disciplines is a time honored innovation strategy. In fact, I have been invited to participate in an effort to develop new approaches for eradicating polio by a multinational non-profit health organization. This organization is bringing together a group of thinkers from a variety of disciplines and industries to provide a fresh perspective on an intractable health care problem.  
  3. Create a portfolio of early opportunities. Allocate a portion of the annual budget to new and evolving technologies. Traditionally, pharma innovation centers tend to have little budget and authority. This has got to stop. Top management has to be actively involved with the change agenda. I have seen too many smart marketers spin their wheels in these innovation centers. Without top management active involvement, innovation just doesn’t happen.

(R & D in pharma / shutterstock)