By Cindy Dubin, Contributing Writer
It’s a pharmaceutical given: Expect to spend $1.3 billion and 15 years to bring one drug to market. So, when cloud computing came along a couple of years ago with the promise of reducing time and money, large biopharma companies began moving their major business processes and applications to the cloud.
Cloud computing is rapidly growing in importance as life sciences R&D organizations are deluged with data from multiple
sources. Simultaneously, demand for computationally complex modeling and simulation studies continues to rise dramatically. Limited funding and budgets make it difficult for many organizations to build the IT infrastructure necessary to keep pace with these challenges. Cloud computing appears, for many, as a promising alternative to in-house expansion of IT services. The trend in pharma toward more outsourcing, combined with restricted budgets and the increasing attractiveness of cloud computing offerings, has created a highly dynamic, yet nascent, market, writes Ken Rubenstein, Ph.D., in his book Cloud Computing in Life Sciences R&D.
The main impact to pharmaceutical companies of increased usage of cloud computing is a reduced dependence on their own IT infrastructures. Cloud computing offers the ability to implement services in a matter of minutes, by self-service from a Web platform. Cloud computing also provides the ability for companies to move away from intensive capital expenditures to an operating expenditure/pay-as-you-go business model. The business advantages of cloud computing include the standardization and streamlining of operations and stronger collaboration among external entities and the healthcare ecosystem as all parties have access to the cloud.
Lower costs are the result. By only paying for the computer power that you are currently using, you can lower the costs of meeting variable or unpredictable demands. However, the cost advantages of moving to cloud-based computing may not be as profound as some declare. Transition costs need to be taken into consideration. It is clear that organizations that already have in-house data centers will have to look at an investment in cloud computing as another cost or will have to merge their internal world with the cloud-based world and manage the switching costs. Even in this situation, the cloud model provides an attractive mechanism for rapid provision of high computational or storage capabilities when demands exceed existing infrastructure capacity.
Cloud computing is identified by SAFE-BioPharma Association as one of three IT trends that will shape the life sciences industry in 2012. The ability to create new alliances and get trial sites up and running more quickly, as well as analyze data more rapidly because it is standardized and centralized, could yield substantial financial advantages. Reducing time to market by just one month for a product that generates annual sales of $300 million could deliver $25 million in extra sales.
Operating Costs Down 30%
According to IBM Global Business Services, cloud computing allows pharma to operate more efficiently by cutting IT costs and accelerating the deploying of new technologies and processes. Sharing an IT platform with other entities means an organization can use computing resources more efficiently and reduce the amount of data it needs to store. IBM’s research suggests that life sciences organizations can save as much as 25% of their annual operating expenditures on clinical IT systems by using cloud computing.
At GlaxoSmithKline (GSK), that number is closer to 30%. GSK spends more than $5.9 billion each year in research. Back in 2010, GSK was searching for the ability to collaborate with external partners, support growing markets, move away from customized IT solutions, decrease operating and investment costs, and access the work environment from anywhere at any time with any device.
GSK chose to replace its existing Lotus Notes, Domino, and Postini services with the Microsoft Business Productivity Online Suite, which included Microsoft Exchange Online, Microsoft Office SharePoint Online, Microsoft Office Communications Online, Microsoft Office Live Meeting, and the Microsoft Deskless Worker Suite. The company deployed the solution to 96,500 employees worldwide, with everything being hosted by Microsoft at Microsoft data centers around the globe. “Rather than spend a ton of money to upgrade our old system, we chose to move to an external host,” says Adam Raeburn-James, senior VP of end user and infrastructure services at GSK.
Through online services, Microsoft offers the ability to have fully functioning applications with a lean presence. The software will operate in the same capacity in a hosted solution as it would if it were implemented on-premise. The global implementation of Microsoft Online Services at GSK is intended to have numerous advantages for the company, including reducing operational costs.
“Moving to Online Services enables us to reduce our capital input and our total cost of ownership by 1/3 over the next five years,” says Raeburn-James. The ability to introduce a variable cost subscription model for these collaborative technologies allows GSK to more rapidly scale or divest its investment as necessary. That translates into putting more money back into the business. In addition to using the cloud for email and collaboration, Raeburn-James says that GSK will likely make more use of cloud computing in human resources and infrastructure in the near future. “As the online service industry matures, the cloud will be used in more of our business,” he says. “It is foreseeable that the whole clinical process could be running on software in the cloud.”
R&D Productivity and Lower Costs
Bryn Roberts, Ph.D., global head of informatics for pharma research and early development at Roche, agrees that cloud computing will enable science, R&D, and collaboration among the pharma community. And, that the goal is to increase R&D productivity while decreasing costs. “The main drivers for moving to the cloud for R&D are enabling science and collaboration while controlling or reducing costs.”
Roberts, along with his colleagues at The PRISM Forum Association, a nonprofit organization that facilitates cross-industry discussions on hot topics in R&D informatics, recently published a paper about the relationship between the cloud and life sciences. The paper states computer-based technologies will underpin all R&D activities and that next-generation sequencing (NGS) will produce unprecedented volumes of data that might best be stored, shared, and analyzed in a cloud environment. To handle the NGS data explosion, Roche expects to have to leverage data stored in the cloud as well as within its own internal high-performance computing environment.
This past October, Roche purchased the Provantis Preclinical SaaS solution from Instem to consolidate several key application areas and harmonize Roche sites worldwide. Roche will access the integrated General Toxicology, Pathology, Clinical Pathology, and Protocol & Report Assembly modules using the SaaS delivery model from a U.S.-based data center. A data import solution allows Roche to import data from external sources.
“With the rising cost of R&D, consolidating the number of IT systems and vendors allows us to focus on science, reduce IT complexity, and speed up the R&D process,” says Roberts. “Cloud computing will enable us to harmonize our system landscape for the nonclinical safety departments and help our scientists optimize laboratory processes with one fully integrated solution.” Roche is still evaluating whether current cloud computing services for functionality, such as virtual screening, offer advantages over in-house high-performance computing in tests, such as protein folding.
Regarding the recent announcement that Roche will source email and calendar services from Google, Ken Wilcox, senior VP and global head of pharma informatics at the company, explains that Roche had been using traditional on-site software from multiple suppliers but felt that a cloud-based model would lower infrastructure and support costs.
When it comes to handling an unlimited number of users, Wilcox believes cloud computing has potential. Hundreds or thousands of servers can be up and running in less than an hour and scaled down just as quickly, and Roche only pays for the time it uses.
Costs do decrease with cloud computing, but Roche has yet to total all project numbers to determine its total savings to date. However, Wilcox is convinced that cloud computing will improve mobility options, equip workers in the field, enable global business integration, and also be a cost and time saver for Roche.
Roberts adds, “We will use cloud where it makes sense. The selective use of cloud services accelerates work and research and reduces the time it takes to analyze large volumes of data. More collaboration among scientists means greater success not just within a pharmaceutical company but across the scientific community.”