Biotech and Big Pharma: A blueprint for a successful partnership
Noël Brown
Managing Director and Head of US Biotechnology Investment Banking
Strategic partnerships have long been an important contributor to how drugs are discovered and developed. For decades, big pharma companies have been forming alliances with biotech innovators to increase R&D productivity, expand geographical reach and better manage late-stage commercialization costs.
Noël Brown, Managing Director and Head of Biotechnology Investment Banking, and Greg Wiederrecht, Ph.D., Managing Director in the Global Healthcare Investment Banking Group at RBC Capital Markets, are no strangers to the importance of these tie-ups. Noël has over 20 years of investment banking experience in the industry. Before moving to the banking world in 2015, Greg was the Vice President and Head of External Scientific Affairs (ESA) at Merck, where he was responsible for the scientific assessment of strategic partnership opportunities worldwide.
In the following Q&A, Greg shares his unique perspective on why partnerships are vital for both biotech and big pharma companies.
Noël Brown: Why are strategic partnerships appealing to both biotech and big pharma companies alike?
Greg Wiederrecht: “It’s a matter of scale. It’s impossible for large pharma companies to work in every single sub-therapeutic area out there. In today’s markets, the vast majority of approved drugs are associated with some type of licensing partnership or acquisition component. Even the largest companies can only work on so many targets at once, whereas there are hundreds of thousands of researchers in academia and biotechs out there who can specialize in vastly more diseases. If one of them makes a discovery that satisfies an unmet medical need, then large pharma can form a strategic partnership to provide a jump start on their competitors.”
NB: What exactly does a strategic partnership entail?
GW: “It can be something
as minor as a feasibility study, or more significant like a patent license, development
