R&D PARTNERSHIPS - Partnering for Progress: How Collaborations Are Fueling Biomedical Advances

INTRODUCTION

In today’s era of rapid scientific progress, public- and private-sector researchers are seeking to leverage their strengths in collaborative ways to accelerate innovation in patient treatment and care. Biopharmaceutical companies increasingly are partnering with a diverse set of healthcare stakeholders to address scientific and technological challenges, create greater efficiencies in research and development (R&D), and accelerate the discovery, production, and delivery of critical new treatments for patients in need. Forward thinking biopharmaceutical companies serve not just as partners, but often also act as integrators in this ecosystem, bringing together diverse players and providing scientific, regulatory, and delivery system insights; operational capabilities; and financial resources.

Deloitte was contracted by the Pharmaceutical Research and Manufacturers of America (PhRMA) to analyze the various types and number of biopharmaceutical partnerships created throughout the past several decades. Based upon a comprehensive database of partnerships formed between 1980 and 2014, we found that R&D-focused partnerships — most notably, non-asset-based, pre-competitive models (those whose primary objectives do not necessarily center on a specific drug candidate) have grown substantially throughout the past decade and highlight the growing role and importance of more open, collaborative approaches to R&D innovation.

NAVIGATING THE BIOPHARMACEUTICAL INNOVATION PROCESS: OPPORTUNITIES & CHALLENGES

R&D activity is increasing to address unmet patient needs. The last decade has seen a steady rise in Food and Drug Administration (FDA) drug approval rates, demonstrating progress in addressing patient unmet needs despite growing R&D and regulatory challenges. Between 2011 and 2016, 204 new molecular entities (NMEs) were approved by the FDA through the Center for Drug Evaluation and Research (CDER), compared to just 131 NMEs approved between 2005 and 2010.¹ Further, the FDA’s CBER (Center for Biologics Evaluation and Research) approved 11 new medicines in 2015 in addition to several biological and blood products not formally classified as drugs. There is also significant current R&D activity, with more than 7,000 new medicines in development across the globe.²

Throughout the past 10 years, biopharmaceutical companies have increasingly sought to address previously unmet medical needs by building on scientific advances in genomic and molecular medicine. For example, the era of personalized medicine is rapidly changing the way diseases are identified, patients are diagnosed, and treatment decisions are made. Collaboration across the biopharmaceutical R&D ecosystem has been essential in driving important scientific breakthroughs in novel diagnostics technology and in identifying molecular targets for the development of personalized medicines. These advances are reshaping drug development. Biopharmaceutical companies are committed to advancing targeted therapies and medicines to treat serious conditions and unmet medical needs.

AN INCREASINGLY CHALLENGING BIOPHARMACEUTICAL R&D ENVIRONMENT

As researchers learn more about the molecular underpinnings of complex diseases, traditional methods for assessing the clinical safety and efficacy of a medicine in development create myriad innovation challenges. Some of the scientific, regulatory, payment, operational, and financial hurdles that complicate the biopharmaceutical R&D process and can increase the cost, time, and risk of drug development include:

-Scientific Complexity: Drug developers are pursuing more complex disease areas (eg, rare cancers, neurological conditions, etc) and are using new approaches to fight these diseases, often at the molecular and genetic levels.

-Regulatory Requirements: Regulatory requirements have continued to proliferate. The rapid increase in new sources of evidence, including patient-reported outcomes, patient-generated data, and real-world evidence (RWE) present new challenges related to data collection, analysis, storage, and confidentiality. Further, there remains uncertainty around regulatory acceptance of some of the more novel clinical trial designs and endpoints that companies are currently pursuing.

-“Burden of Proof” for Coverage & Payment: Health plans, healthcare providers, and patients often have differing views of the value of new medicines. Restrictions on biopharmaceutical companies’ ability to proactively engage with health plans to discuss types of evidence prior to product approval may make it more difficult to determine what data would be most useful for coverage and payment decisions.

CHARACTERIZING THE BIOPHARMACEUTICAL INNOVATION ECOSYSTEM

An ecosystem model can be used as a lens through which to view the biopharmaceutical innovation landscape. Deloitte defines ecosystems as “symbiotic, cooperatively evolving communities composed of multiple diverse players.”³ The biopharmaceutical R&D ecosystem is composed of a range of stakeholders, including but not limited to: biopharmaceutical companies, investors, healthcare providers, federal research organizations, academic institutions, non-profits, services, regulators, health plans, and others.

This ecosystem enables a varied group of stakeholders to achieve together that which would be difficult for any individual participant by itself. Together, the highly specialized players contribute new perspectives, capabilities, and resources to drive new scientific advances and solutions. Both collaboration and competition are essential drivers of sustained ecosystem success. Stakeholders may be motivated to collaborate by their shared ambitions, objectives, and commitments, while inherent competition may bolster ecosystem activity and contribute to a more efficient and productive R&D process.

Innovative biopharmaceutical companies serve not just as partners, but often as integrators in this ecosystem, bringing together diverse players. They also provide scientific, regulatory, and delivery system insights, operational capabilities, and financial resources to help deliver critical new therapies to patients in need.

R&D PARTNERSHIP DATABASE FINDINGS: PARTNERING MODELS & TRENDS

Deloitte analyzed the types of biopharmaceutical R&D partnerships created from January 1980 through August 2015, building a comprehensive database of collaborations from EvaluatePharma Life Sciences partnership information, supplemented with non-duplicative data from FasterCures’ Consortiapedia. To accommodate the diversity of partnership types and stakeholders investigated as part of this research, Deloitte conducted a manual scan of various PhRMA member company partnerships throughout the past 10 years (2005–2014) in October 2015, which resulted in the inclusion of additional unique, non-duplicative partnerships. Further, Deloitte interviewed 12 biopharmaceutical industry ecosystem executives, covering individual biopharmaceutical companies and consortia, academia, federal research, and other organizations.

The database identified two broad categories of partnerships – asset-based and non-asset-based. Asset-based partnerships include acquisitions and licensing of compounds, products, or technology. Non-asset-based partnerships include joint ventures (JVs), consortia, and others, such as those focused on education and awareness.

Traditional asset-based partnerships typically involve two parties (such as a pair of biopharmaceutical companies) that are focused on a particular asset (ie, investigational medicine), and use a structure (a “sponsor” and “partner” model) that distributes control, risks, and rewards. A common objective is to progress a single asset through the R&D process, obtain approval, and launch. Today’s non-asset based partnerships diverge notably from that model — collaborative alliances may include three or more parties and are often composed of a mix of ecosystem stakeholders, including biopharmaceutical companies, academia, non-profits, and government entities. Importantly, these partnerships feature shared control and decision-making, thus spreading both the potential risks and rewards. Non-asset-based partnership examples include:

-Joint Ventures (JVs): Two or more entities enter a collaboration wherein all involved parties agree to jointly contribute to R&D-related activities to achieve a specific objective. They typically involve joint governance and decision-making, and sharing of accompanying risks and rewards.

-Consortium: Three or more parties pool resources and work together to achieve a common goal, such as accelerating scientific discovery in a particular disease area or technology. Some consortia include “pre-competitive” arrangements in which all players work together to solve problems and develop capabilities in areas where they would typically compete with each other.

-Other: Parties provide financial resources and/or marketing, educational, and promotional programs (eg, company support of broader disease awareness efforts).

PARTNERSHIP GROWTH

Approximately 9,000 new biopharmaceutical R&D partnerships were formed between 2005 and 2014 at an annual growth rate of 4% during that 10-year period. The 9,000 new biopharmaceutical R&D partnerships formed between 2005 and 2014 are more than double the number formed (approximately 4,000) in the preceding decade (1995–2004). Consortia showed the strongest growth, increasing nine times over the prior decade, with 334 new R&D consortia in 2015. Additionally, early stage partnerships (ie, prior to a potential new therapy entering clinical trials) have more than doubled between 2005 (256) and 2014 (578).

IMPACT OF COLLABORATIVE PARTNERSHIPS

Deloitte conducted interviews that further explored consortia practices, learnings, and outputs. These collaborative partnerships have already expanded knowledge and made progress against some key health challenges and opportunities:

Understanding Difficult Diseases at the Molecular Level: Alzheimer’s Disease Neuroimaging Initiative (ADNI)
Growing understanding of the inner workings of complex diseases is revealing important pathways for new research, but also unearthing new challenges. The ADNI was formed in 2004 to advance understanding of this devastating disease in order to develop new treatments to slow or stop Alzheimer’s progression. The initiative, formed by the NIH, National Institute on Aging (NIA), FDA, and numerous industry, academic, and non-profit organizations, has made tremendous strides in Alzheimer’s Disease (AD) detection, helping to elucidate the underlying pathways of AD progression, and improving the efficiency of clinical trials related to addressing AD.

Quickly & Effectively Diagnosing & Tracking Disease Progression: Cure Huntington’s Disease Initiative (CHDI)
The non-profit CHDI Foundation was created in 2002 by several biopharmaceutical, academic, and contract research organizations (CROs) to focus on developing therapeutics to track and slow the progression of Huntington’s Disease (HD).⁴ One accomplishment includes developing an assay to measure the build-up of a protein that is known to be harmful for patients with HD.

Using Biomarkers to Monitor Patients Before, During & After Trials: Biomarkers Consortium
The Biomarkers Consortium, formed in 2006, is focused on identifying, developing, and qualifying biomarkers for cancer, inflammation and immunity, metabolic disorders, and neuroscience. The Biomarker Consortium includes 30 organizations, and is managed by the Foundation for the National Institutes of Health (FNIH) as a public-private partnership. Some notable achievements via the application of biomarkers to research include development of approaches to accelerate trials for breast cancer, defining sarcopenia (loss of muscle tissue) as a disease (versus simply an effect of the aging process), and predicting long-term results of statins used to treat patients with high cholesterol and/or risk of developing cardiovascular disease.

Developing New Ways of Conducting Clinical Trials to Take Advantage of Recent Technological & Operational Advances: Lung Master Protocol (Lung-MAP) Consortium
As we move toward an era of targeted and personalized treatment, the traditional randomized, controlled trial presents some significant challenges. New trial designs, which capitalize on the growing understanding of the underlying biology of disease, are beginning to present new paradigms for conducting clinical research. The Lung-MAP consortium is a public-private partnership formed in 2014 to develop a novel, multi-drug clinical trial for patients with a specific, difficult-to-treat form of advanced lung cancer (squamous cell carcinoma). The trial design leveraged genetic profiling to assign patients to one of the trial arms.⁵ Applications of this type of study design have helped to advance precision medicine in oncology and generate interest from biopharmaceutical companies and others in tackling difficult cancers with a personalized approach.

Evaluating the Potential for Combination Treatments: Collaborative Novel-Novel Combination Therapies (CoNNCT)
Over time, researchers often identify additional benefits of medicines when used in novel combinations with other drugs. In many cases, the treatments may confer greater benefit together than when used individually. Recognizing the value of these expanded therapeutic options, academic centers, biopharmaceutical companies, and non-profits are collaborating through a partnership called CoNNCT to accelerate identification of effective drug combinations for cancers. The goals of this collaboration are to make it easier to test multiple combinations of new drugs, reduce the cost of investigational studies, shorten the time to demonstrate proof-of-concept and, ultimately, to accelerate the development of novel treatments in other diseases and conditions.⁶

Accelerating Translational Research: The California Institute for Biomedical Research (Calibr)
Translating early research findings into therapeutic advances is a challenging process that requires both in-depth understanding of the science as well as specific regulatory and development capabilities. Calibr is a not-for-profit collaborative that is bringing partners together to accelerate translational research in order to develop new medicines for patients with unmet needs across a broad range of disease areas.⁷ Building on the success of early, open collaboration, Calibr also has a unique structure that enables commercial partnerships later in the development process.

FUTURE OUTLOOK

The Deloitte R&D partnership database research and interviews with key ecosystem leaders point to a growing recognition of the value and importance of collaboration across members of the R&D ecosystem. These collaborations address the most pressing scientific and technological challenges while harnessing complementary strengths to bring new treatments to patients. Notable achievements and lessons learned from existing pre-competitive collaborations will be used to enable more pre-competitive collaboration in additional research areas, increasing the potential for new breakthroughs.

In the coming years, we expect to see partnering earlier in the development lifecycle with a continued expansion in disease area-focused consortia, including growing emphasis on more “open” arrangements with respect to structure, control, risk sharing, and other business arrangements. Active innovators will seek to develop a portfolio of partners with a diverse mix of scientific and operational capabilities to support non-asset -based partnerships to propel innovation and bring new medicines to patients in need more quickly and safely. The eco-system is likely to expand its membership as regulators and the healthcare delivery system, particularly health plans, need an ever-larger evidence base (including patient-generated data, patient-reported outcomes, and “real-world evidence”) to inform review and approval of drug applications. Additionally, evolving innovative coverage and payment models could fuel an even broader range of partnerships in the future.

REFERENCES

1. Food and Drug Administration, “Novel New Drugs 2016 Summary,” January 2017.
2. Adis R&D Insight Database, February 2017.
3. Eamonn Kelly, “Business ecosystems come of age,” Deloitte University Press, April 15, 2015.
4. CHDI Foundation website; accessed June 30, 2016.
5. “Ambitious Lung-MAP Trial Launched With Five Novel Drugs”, Onclive.com, July 31,2014.
6. “More than 40 Industry Visionaries Meet to Explore New Combination Cancer Drug Development Paradigm”, BusinessWire, March 7, 2016.
7. Calibr website; accessed June 30, 2016.

Neil Lesser is a Principal with Deloitte Consulting LLP in the Life Sciences Strategy practice and a leader in the Research & Development (R&D) Strategy practice. He joined Deloitte in 1998 and works with Life Sciences executives to create and implement strategies that drive productivity, efficiency, and value. He leads strategy, operating model design, productivity improvement, and large transformation initiatives within R&D and Regulatory Affairs. He is a frequent writer and speaker on R&D productivity.

Matt Hefner is a Senior Manager with Deloitte Consulting LLP in the Life Sciences Strategy practice and a leader in the R&D Strategy practice. He helps large and small biopharmaceutical and medical technology clients create new value, increase productivity, and reduce risk through development and implementation of competitive corporate strategies, digital initiatives, strategic partnering and external innovation, novel business models, and operational improvements.