Partnerships and the move to value dominated the chatter at the BIO International Convention’s 25th annual partnering meeting on Monday in the life science hub of Boston.
The industry-sponsored event drawing executives from both local and foreign regions is aiming to break a Guinness World Record by hosting the largest business partnering meeting. Still, unlike the J.P. Morgan Healthcare Conference, lauded as a major deal-making show, or the American Society of Clinical Oncology conference now shooting out reams of new cancer data, BIO typically has more modest announcements and behind-the-scenes talks.
As the convention competes for headlines with ASCO this week, it begs the question, “does the BIO convention still hold value for participants?”
“Unlike J.P. Morgan, there isn’t a ton of activity anchored around [BIO]. By design, a lot of deals are announced or closed at J.P. Morgan. BIO isn’t like that, but it’s very deal-focused,” said Neel Patel, managing director of commercial strategy and planning at Syneos Health, in an interview. “It’s more about origination and continuation of deals. It’s about continuing the conversations.”
With 20 different educational tracks that include more than 150 panels and 2,500 CEOs in attendance — as Patel pointed out — it could be a good place to get the conversation started.
Some highlights from day one include:
From volume to value
‘Patient-centricity’ has been a buzzword in the pharmaceutical industry for the last decade, but Pfizer’s Chief Operating Officer Albert Bourla contends the advent of new technologies has finally made this far-flung concept a reality.
During a reside chat at the convention he said the healthcare system, once based on volume, is now moving toward value — in large part, due to technology.
“Right now the business model is that someone would prescribe [a blood thinner], and based on how many pills you take, we are going to get paid. In a value-based marketplace, you are not going to get paid based on how many people took your medicines, but you are going to get paid on how many strokes are avoided,” Bourla said.
The executive said this shift in the basic business model means pharma companies are going to have to spend more time improving outcomes for patients through wellness initiatives like education on lifestyle and education for physicians on how to manage multiple medications. The industry will also need new tools for measuring outcomes.
“This creates very different dynamics in competition. Companies that will be able to create better outcomes from a single medication will be the ones that will win in this marketplace,” Bourla added.
Bradner promotes external collaboration, ‘bravery’
Jay Bradner, president of the Novartis Institutes of BioMedical Research (NIBR), the Swiss pharma’s discovery engine, said he really pushed for an atmosphere of open collaboration when he joined in 2016, building on his background in academia.
“All great science builds on this incredible foundation of generations of science before us. We sort of get that as discovery scientists today. We may not innovate the next machine-learning algorithm, but we should be the best people ever to find it and then apply it properly to an emerging clinical endpoint,” said Jay Bradner, president of the Novartis Institutes of BioMedical Research (NIBR) — the Swiss pharma’s discovery engine.
He called Novartis the ideal partner in this respect, pointing to the collaboration with Incyte that developed the JAK inhibitor Jaka (ruxolitinib). He added that Novartis had its own JAK2 inhibitor internally but followed the science to the Incyte molecule.
“What that converges on is the desire to connect and externalize our science and to collaborate aggressively externally. We have 6,000 scientists and they should feel empowered and enabled to work alongside, shoulder-to-shoulder, with the innovator that can advance their idea,” said Bradner. “This has created a culture of bravery, openness and kindness. I think you can’t be a great partner in research if you don’t have these things. Is your idea brave, to approach it openly and to treat people kindly. That’s how we think about these partnerships at NIBR.”
A little dealmaking advice
For a small biotech, the outside dynamics of your segment play a much larger role in overall success than many of the internal factors that the company has control over, said Oded Ben-Joseph, managing director of Outcome Capital, in an interview at convention.
Outcome Capital is a financial consultancy that advises biotech, medtech and diagnostic companies on positioning, strategy and M&A, that includes many industry veterans on staff. Ben-Joseph said that one of the most frequent pieces of advice that he gives his clients is “know your segment.”
“Adopt the external view. It is that external view that will determine the reality of your company. You can be a fantastic and experienced CEO, but the outcome of your efforts are going to be very different if you are an infectious disease company than a neurodegenerative company than say a ophthalmology device company. It’s going to be a completely different reality,” he said.
Ben-Joseph noted that — like many in the industry — Outcomes Capital is more focused on oncology and immuno-oncology companies right now, versus those in the infectious disease space. “Although it’s very interesting and there is absolute unmet need for new antibiotics, the dynamics of that segment are unfavorable for most companies; venture capital investment is very limited, the path to liquidity is very limited, and those that do go all the way have to have enough dry powder to get to Phase 3 or almost approval. That’s when the transactions happen. Whereas in oncology, you see transactions all the way from preclinical to approval,” Ben-Joseph said.
Other advice the consultant gives his clients: Focus on your most mature asset. And speak to potential pharma partners early; much earlier than you expect to exit.
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