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Alternative licensing models to stimulate innovation
Thomas Krohn, RPh, MBADirector, Clinical Open InnovationEli Lilly and Company
World Drug Repositioning CongressWashington, DC5 December 2012 “Please note that some of the views presented do not
necessarily reflect those of Eli Lilly and Company”
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3 Goals Today
• Case for alternative licensing/business model• Lessons from other industries• Example alternative model
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Drug Development Today
Targeted Confirmation
Closed
Exploratory
Collaborative
patent
Innovation Process
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Licensing Today
patent
Portfolio Attrition
Business Development Deal
Portfolio Gaps
Patent clock tickingAsymmetric informationInconsistent RepresentationCustom DealsEffort and timePrioritization / Opp Cost
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Backup Compounds: Licensing Concerns
• Cannibalization of lead compound• Class-effect safety concerns• Partner does bad science• Loss of ownership and control• Intellectual property issues
Red Herrings or Mitigable Risks
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Incremental Improvement
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We need a bolder alternative
to S1'
to S2S1
Time
Performance
DisruptiveChange
• Simpler• Faster• Cheaper
• Sustaining Innovation• Efficiency Innovation• Empowering Innovation
Clayton Christiansen – NYT, 11/4/12
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Learning from other industries
• Access to options - buy & sell• Standard content representation• Streamlined transactions• Licensing to enable external innovation
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Access to options - buy & sell
Music Industry
PhysicalPurchase
MP3 Download
SubscriptionAny music, anytime, anywhere
Collectibles
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Standard content representation
Amazon Search
Clinical Collections
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Streamlined transactions
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Enabling external innovation
Open source software– Licensing
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Creative Commons Licenses
Exclusivity
Permission required
Creativity
Predefined permission
Absolute Flavors
Copyright Copyleft
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Enabling external innovation
Open source software– Copyleft Licensing– Collaborative Development– Full transparency
Linux Forks
$1B
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Learning from other industries
• Access to options- buy & sell• Standard Representation• Streamlined transactions• Enabling external innovation
Removed Barriers to Market Innovation
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Licensing Today
patent
Portfolio Attrition
Business Development Deal
Portfolio Gaps
Patent clock tickingAsymmetric informationInconsistent RepresentationCustom DealsEffort and timePrioritization / Opp Cost
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What if?
patent
Portfolio Attrition
Business Development Deal
Portfolio Gaps
Patent clock tickingAccess/Clearing HouseSymmetric informationStandardized RepresentationStandardized DealsInnovation Enabling Licensing
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Example Model : Commons Drug Development
Creative Commons Model Patent License
CC Public Patent License
Optional Addendums• License Fees and Royalties • Field of Use• “Have Made” Limitations • Choice of Law• Choice of Venue• Territory• Offer Limitations
Advantages• Standardized• Streamlined• 3 Layers:• Legal Code• Human Readable• Machine Readable
http://wiki.creativecommons.org/Model_Patent_License
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Commons Drug Development
Pharma Biotechs Academics Foundations Individuals
• standard “rules” of entry• standard legal tools• standard data formats• must contribute data to access data• voluntary commitment
selected creation of precompetitive data spaces
• preferred strategic partners• same rules and formats: interoperability• creation of a data “commons” over time
2
• “decay” of data into public domain• foundation funding and crowd talent• encourage tool development by crowd
3
1
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Empowering Innovation
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More Information
• www.creativecommons.org• www.lillycoi.com
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Thank You
Thomas Krohn, RPh, MBADirector, Clinical Open InnovationEli Lilly and Company