View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Comment
February 7, 2020

Traditional big pharma deal strategies must be adapted to foster innovation

By GlobalData Healthcare

Pharmaceutical innovation is changing, and so the big pharma business model must evolve too, especially in the deals space, urged experts at the Biotech Showcase during the JP Morgan Conference in San Francisco this January.

Free Report
img

2022: So far In Venture Capital

Global investment in 2022 has been majorly dominated by North America, Europe, and Asia Pacific, whereas the Middle East, and South and Central America have recorded low investments comparatively. In light of this, Europe and North America have been identified as the major destinations for Private Equity and Venture Capital (PE/VC) investments.   GlobalData’s whitepaper analyzes which sectors PE/VC firms have been investing in, looking at Technology, Media, and Telecom, with these sectors recording $356 billion and a deal volume of over 10,000 deals in 2022. Healthcare, Financial Services, Business & Consumer Services, and Construction sectors have also seen high investment activity by PE/VC firms, recording a deal value of over $70 billion each.   But what can this mean for you?   Understand how the Deals Database on GlobalData Explorer can be leveraged to:  
  • Track the Aggregate Investment Volumes in PE/VC-Stage firms across geographies and sectors, in addition to viewing the specific deals that drove these volumes
  • Identify the top investors already active in any sector-Geography combinations
  • Assess the Performance of Financial and Legal Advisors, supporting the Dealmaking in any segment of choice (Customizable League tables)
  • Understand what is driving the PE/VC fundraising (Deal Rationale)
  Consult our full report here and optimize your business strategy.
by GlobalData
Enter your details here to receive your free Report.

Panelists of ‘The Pharma Perspective: Transformation and Trends’ session discussed how novel modalities such as cell and gene therapies present high-risk opportunities with the chance for high reward, necessitating an adjustment of deal strategy to capitalise on them. Innovation is increasingly found outside of Big Pharma, with much of the early-stage research in the hands of small, unpartnered independent companies.

The panel agreed that traditional deal strategies must be adapted to foster innovation. Friedemann Janus, vice-president and head of business development at Bayer, spoke at the panel. He explained that to account for the higher risk of failure and facilitate a totally different return-on-investment strategy that could facilitate investment despite that risk, the company established an investment arm, Leaps by Bayer, to provide an isolated pot for investment in a high-risk portfolio, including the likes of CRISPR Therapeutics and CRISPR editing company eGenesis. For information on these deals and others, please refer to the GlobalData Pharma Intelligence Centre Deals database.

Also on the panel, Debi Watson, director of business development and licensing for Johnson & Johnson (J&J), discussed the importance of interacting with early-stage companies and fostering innovation through them. She explained, “J&J positions itself to interact with the ecosystem in a very significant way,” adding “we absolutely realise some of the best science is happening outside our four walls.”

Similarly, J&J opened the Johnson & Johnson Innovation (JJDC) venture capital arm of the company to focus on early-stage investment and partnerships rather than M&A. Speaking of Janssen’s (the pharmaceutical companies of J&J) high-risk 2017 investment in the China-based CAR-T company Legend Biotech, Watson said, “We did a licensing deal, we did not do an acquisition…the equation was that it was moving so rapidly…we really wanted to invest in the area and see how we could grow our capabilities and then make further investments.”

The panel concurred that scientific interactions and partnerships are occurring at earlier and earlier stages of drug development, with big pharma becoming more open to high-risk, early-stage investment and needing to, as Watson put it, ‘structure deals very creatively.’

Similarly, panelist Philippe Lopes-Fernandes, senior vice-president and global head of business development and Alliance Management at Merck KGaA, added some of the best innovation may be happening in Europe rather than the US or China, and explained, “We can find the same innovation or better in Europe, for a fraction of the price.”

John McDonald, corporate vice-president global business development at Novo Nordisk, discussed what had prevented Novo from doing deals in the past. He said that manufacturing presents a significant issue when it comes to producing clinical-grade and high-yield cell and gene therapies, with the FDA holding manufacturers to very high standards for reproducibility. Instead, McDonald explained Novo’s approach is to invest in its own manufacturing facilities in order ‘to become more of a centre for other people we’re trying to partner with.’

Related Companies

Free Report
img

2022: So far In Venture Capital

Global investment in 2022 has been majorly dominated by North America, Europe, and Asia Pacific, whereas the Middle East, and South and Central America have recorded low investments comparatively. In light of this, Europe and North America have been identified as the major destinations for Private Equity and Venture Capital (PE/VC) investments.   GlobalData’s whitepaper analyzes which sectors PE/VC firms have been investing in, looking at Technology, Media, and Telecom, with these sectors recording $356 billion and a deal volume of over 10,000 deals in 2022. Healthcare, Financial Services, Business & Consumer Services, and Construction sectors have also seen high investment activity by PE/VC firms, recording a deal value of over $70 billion each.   But what can this mean for you?   Understand how the Deals Database on GlobalData Explorer can be leveraged to:  
  • Track the Aggregate Investment Volumes in PE/VC-Stage firms across geographies and sectors, in addition to viewing the specific deals that drove these volumes
  • Identify the top investors already active in any sector-Geography combinations
  • Assess the Performance of Financial and Legal Advisors, supporting the Dealmaking in any segment of choice (Customizable League tables)
  • Understand what is driving the PE/VC fundraising (Deal Rationale)
  Consult our full report here and optimize your business strategy.
by GlobalData
Enter your details here to receive your free Report.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. A weekly roundup of the latest news and analysis, sent every Friday. The pharmaceutical industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Pharmaceutical Technology