By Joshua Schultz, coporate VP of clinical research services, PAREXEL International
The pressure to accelerate time-to-market for innovative biopharmaceutical products has never been more intense. Every biopharmaceutical company feels the need to drive promising therapies through development and gain market approval as quickly as possible to maximize the value of its assets. At the same time, current market and economic realities are compelling the industry to reduce fixed costs, increase efficiency, and concentrate limited resources on core competencies. The challenge of accelerating product development while controlling costs creates a difficult balancing act for industry executives.
Many biopharmaceutical companies are embracing innovative approaches to strategic partnerships to help them meet this challenge. These approaches rely on integrated, long-term relationships with a small number of key partners to create a strategic, cost-effective mix of internal and external resources. Leveraging strategic partnerships allows biopharmaceutical companies to greatly increase operational efficiency by focusing their resources on the highest priorities — such as discovery research and product marketing — while utilizing the specialized expertise and infrastructure of their partners for other capabilities.
As biopharmaceutical companies evolve toward broader strategic partnerships, CROs such as PAREXEL offer new partnership models to meet the industry’s growing demand for expert resources and global reach. These relationships range from study- and program-based models to full strategic partnering models, where CRO partners provide a variety of development programs encompassing multiple therapeutic areas, business functions, services, geographies, and studies utilizing an integrated management team.
Regardless of the specific model, long-term, integrated strategic partnerships can provide significant benefits for biopharmaceutical companies. These benefits fall into several major categories, including savings from:
Reduced sponsor oversight requirements — By working in partnership with a CRO on major development projects, the sponsor requires fewer internal resources to oversee these projects. Instead, oversight is supported by agreed-upon quality specifications, project metrics used across the portfolio, continuous quality control, and close communication.
Efficiencies gained through consolidation of activities — A strong, long-term commitment between the partners allows service rates to be significantly reduced, based on the higher volume of work and the greater efficiencies that accrue over time. A longer-term partnership also reduces the potential for costly short-term decisions and offers opportunities for additional savings based on innovative risk-sharing options and bonuses.
Streamlined proposal and contract management functions — With a long-term strategic development relationship in place, there is less overhead for contract management activities, proposal development and responses, and other costly administrative transactions.
Additionally, there are time savings. The most significant partnership savings result from reductions in development times. Those savings could exceed $80 million annually for a major development partnership over a period of years if the right processes are implemented to reduce critical path cycle times.
Although the potential benefits of long-term strategic partnerships are substantial, they are not automatic. There are numerous proven success factors that should be incorporated into the relationship to help maximize the benefits for both parties. These include:
Focusing on targeted outcomes
Implementing meaningful metrics
Defining the scope of work
Establishing strong governance
Sharing the benefits and risks
Optimizing and harmonizing key processes
Paying attention to change mgt.
By taking the right approaches to strategic partnerships, biopharmaceutical companies can maximize their resources, accelerate product development, and gain a competitive edge at a time when even a small advantage can deliver large marketplace dividends.