Magazine Article | March 12, 2011

Revitalizing Pharma Innovation In Germany

Source: Life Science Leader

By Dr. Christian Garbe

The pharmaceutical roots of Germany’s Rhine-Main region are deeply embedded in firms such as Degussa, Cassella, and Hoechst. They were decisively involved in the improvement of the region and its international reputation as the place for pharmaceuticals and chemicals. The restructuring of these firms in the 1990s led to a loss of competence.

As a result, the growth dynamic of the area diminished. In addition, small and midsize pharmaceutical research firms were subjected to a painful adaptation process.

In an effort to revitalize the innovation potential of the region and strengthen competence, the FIZ Frankfurt Biotechnology Innovation Center was founded in 2002 and caters to national and international firms in the areas of pharmaceuticals and biotechnology. Based in Frankfurt — Germany’s commercial capital and largest city in the state of Hesse — the technology center offers small and midsize companies from the field of life sciences a tailor-made infrastructure, interdisciplinary networks, and comprehensive consulting services for the commercialization of their product and service ideas. It also serves as a platform for research and innovation in the life sciences sector and as an integral part of the innovation and technology profile of the business structure of the Frankfurt Rhine-Main region.

FIZ is not only an innovation center, it is linked to a significant, worldwide industrial environment. About 300 employees, mostly in research and development, work in the 13 companies located at FIZ. Their know-how and innovative services enable extensive networking.

Promoting Cooperation For Innovation
Numerous large and midsize firms are now convinced that, in the future, there will be more business associations and that the competition for suitable partners will become more intense. Because of higher capital costs and fewer resources, large firms are increasingly turning to cooperation to maintain their ability to innovate.

In order to boost innovation by promoting dialog and intersectoral collaboration between industry stakeholders and the latest research, the FIZ Life Sciences Forum was founded. The goal is to bring key decision makers from life sciences and business together for dialog, provide a professional thought-provoking impulse, and develop new solution approaches across industries.
The FIZ Life Sciences Forum is held annually. The last forum was held in 2010 and focused on changing business models for pharmaceutical companies and developing solutions for the strategic challenges facing the life sciences industry.

Participants agreed that cross-industry cooperation and business models are needed to close innovation gaps and to make use of new strategies. Among the participants were representatives from Merck Serono, which has already expanded the range of collaboration models in the past few years. According to the head of research at Merck Serono, even the major players of the industry are no longer able to manage their approaches to innovation on their own. It was pointed out that even though biotech companies contribute significantly to the development of drugs, the industry is still a key partner when introducing drugs into the market.

Cross-Innovation: Added Value For Customers
Cooperation to generate holistic healthcare concepts and customized medical care is a major development for maintaining the innovation capability of the healthcare industry. This view was shared by the high-ranking representatives from industry and small and midsize companies at the forum. The ability of firms to cooperate influences innovation significantly, because it enables the detection of trends and combines technologies that will create added value for customers.

Due to the steady decline of the pharmaceutical market, nonmarketability of many candidate drugs from biotech companies, and restrictiveness of the regulatory environment in terms of cost-effectiveness, there is a growing need for networking and cooperation worldwide. In research- and cost-intensive fields, it is important to know how innovation can be generated through cooperation at less risk and made marketable at a faster pace.

The “cross-innovation” approach adopted by FIZ provides a solution that helps to accelerate progress at the interfaces of several technologies from different fields. At present, the industrial wholesale branch offers — through its technological leadership — above-average potential for innovation in many areas for the healthcare industry and its neighboring sectors. For example, in order to develop pharmaceutical products and medical technology, nano or microsystems technology is linked with bio, cell, and gene technology. IT companies now offer new basic technologies at the interface between systems technology and pharmaceutical development that are vital for new healthcare services or treatment options. In this view, personalization and prevention play a central role. In order to use such technologies for this purpose or further development, the integration of innovation processes in marketable structures across sector boundaries is essential.

Personalized Healthcare Management
Cross-innovation, which facilitates personalized health management, interdisciplinary approaches, and new links to health-related data for prevention and health-conscious daily monitoring, will change the products and services offered on the pharmaceutical market. This will result in the creation of new application areas and cross-industry business models.

For decades, pharmaceutical companies have focused more on developing new products and less on the processes that increase patient benefit. Business models based on highly specialized individual technologies have insufficient innovation capacity. On the contrary, prevention, personalized treatment, as well as active and informed patients who show growing interest in health-related data are gaining more importance. Patients and consumers of healthcare place high demands on the life sciences industry due to new lifestyles and increased health awareness.

The focus of personalized medicine is to provide each patient with the best therapy available. In this view, the identification of optimal drug targets is necessary, as well as a better understanding of disease mechanisms and the provision of highly effective diagnostic tests. The publicly accessible IT platform Personal Genomics Services (PGS) developed by bio.logis in 2011, a tenant at FIZ, is recognized as a market innovation in medical diagnostics. bio.logis identifies genetic variations that are responsible for the effectiveness or ineffectiveness of medication and makes the relevant medical findings available on the Internet with the highest level of privacy.

The analysis of genetic human blueprints within just a few days will open new doors to the understanding of diseases and interdisciplinary diagnostics with new innovative therapeutic approaches. Moreover, the healthcare industry will experience a radical change of perspective due to genetic medicine. According to the latest HealthCast series of reports on health industry trends, most of the world’s biggest pharmaceutical companies will have a substantial loss in revenue due to generic imitations by 2015.

In order to remain competitive, healthcare leaders will have to develop new business models and solution approaches. They will also have to promote and develop incentives that encourage partnership. Moreover, stakeholders from business, science, and politics have to become more open to technology transfer and information exchange. Through networking, cooperation, and a combination of complementary knowledge, the innovativeness of firms can be strengthened in a sustainable way.

About The Author
Since 2002, Dr. Christian Garbe has been the managing director of the FIZ Frankfurt Biotechnology Innovation Center. At Novartis, in Basel, he assessed the potential of biotechnology for product development. Dr. Garbe analyzed pharma and biotech companies for the DZ BANK AG and successfully managed the BiotechSTARS certificate.