Collaboration is the future: pharma firms

For years, pharmaceutical and biotechnology companies have been sceptical of involving other companies in their research. But, that notion is slowly changing. With cost effectiveness and duration of research becoming critical to the commercial success of a product, collaborations with other companies and academic research institutions have become the need of the hour.

“The industry is moving towards a model of strategic partnership,” said Patrick Keohane, vice president, R&D, AstraZeneca-Asia Pacific, USA. With Asia emerging as an attractive destination in the last few years, the company said it has slimmed down its operations in Europe and the US in terms of sites and workforce. “We are focusing on re-investing in places like India and China,” said Keohane. To grow its India operations, the company has entered into tie-ups with Indian companies like Jubilant Organosys and Torrent Pharmaceuticals, and is looking to enter more collaborations in India.

Same is the case with most of the major pharma companies in the world. Around 63 per cent of Merck and Co’s revenues in 2009 was attributable to alliance products and patents. Moreover, the company has also entered into alliances with academic institutions like Harvard University and Imperial College, London.

Rikke Festersen, head-R&D, Novozymes South Asia believes that innovation through partnership is becoming a preferred model in business. “There should be a mutual profit sharing based on funding, ideation, technological contributions and overall risks,” said Festersen. The Danish company, which has an R&D presence in Bangalore has 6,000 patents to its name. The company has entered into partnerships with Indian academic institutions in 2009-10 for three projects.

Cost has been a major factor that has encouraged major drug research companies to come into India. Industry experts say it takes around $20 million for phase one of clinical research and $50 million for phase two globally, which can be reduced by 50-60 per cent in India. Moreover, patient accruals in India are also 75 per cent faster. “Drug discovery, which is a closed door process need billions of dollars. However, the cost of working on genomes which used to be very high has come down drastically due to open-source collaboration,” said Samir K Brahmachari, director general, Council of Scientific & Industrial Research (CSIR).

However, experts have a word of caution for companies who take up collaborations. “Concerns on industry-academic partnerships do exist. For companies, sharing information with other institutions would mean a loss of intellectual property while for the institutions, it could be a distraction from academics,” said Swaminathan Subramaniam, director, licensing and external research-India,

Merck and Co. Academic institutions are also yet to exploit collaboration potential with companies as most of them utilise only 20 per cent of their R&D infrastructure capacity, say experts.