externalization and partnerships: the new wave of informatics

Externalization and Partnerships: The New Wave of Informatics Integration Devolution of Traditional Informatics Architectures

Michael H Elliott

[email protected]

www.atriumresearch.com

Twitter: AtriumResearch

About Atrium Research

Atrium Research is an independent market research specializing in scientific informatics We develop packaged and customized research reports and provide strategic consulting services

Externalization is the pursuit of a fully or partially virtualized R&D model integrating partner companies with specific skills or capabilities

It runs the gambit from licensing, academic target id, to pay-per-assay services, risk-sharing partnerships, crowdsourcing - all the way through to jointly owned intellectual property

What is Meant by “Externalization?”

©2013 Atrium Research & Consulting LLC

Future of BioPharma R&D

2011 R&D Spending

Internal 67%

External 33%

2017 Estimate

Internal 42%

External 58%

4 Source: Atrium Research and Challenge, Gray, Christmas


Pharma Industry has cut 297,000 positions since 2000

However, segment remains tied for largest R&D investor

Majority of drugs in clinical trials did not originate inside the walls of big pharma

Something to Think About

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"What Sanofi is doing is reducing its own internal research capacity. The days when we locked all of our scientists up in a building and put them on a nice tree-lined campus are done. We’re not going to get out of research. We believe we do certain things well in research but we want to work with more outside companies, startup biotechs, with universities."

Chris Viehbacher, CEO of Sanofi:


Your future project team will be comprised of collaborators you never met

�  Lower and/or variable costs

� Access to expertise

�  Lowering and/or sharing risk

� New ideas / innovation

� More eyes on the problem

� Agility

� Where the patients are

� “Let’s try something different and see if this works”

What are Some of the Drivers of Externalization?

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Externalization Trends

� Growing 20%+ while R&D spending is flat

� Many companies report desire to target 30-50% of pipeline portfolio originating from outside

� Most report they will be using the same number of partners for the foreseeable future but expanding current relationships

� Growing trend of full horizontal integration (programmatic partners) and risk-based arrangements

� Asia partnerships dominated by small molecule but biologics is quickly emerging

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No company has an externalization strategy that they know for sure will work in the long run


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It is a Different World Out There for IT

Internal �  Can implement common

data workflow solutions

�  Can deploy common master data

�  Can support common IP practices and policies

�  Can enforce common desktop solutions and software

�  Can support a common material workflow

�  Know the people to support

External �  Multiple workflows dependent on

growing number of partners

�  Wide differences in vocabularies that change often

�  Different IP management practices depending on partner

�  Different platforms and software to support

�  Material distributed across the globe

�  Have no idea who all the people are who might use systems

Externalization is Leading Us Toward “Informatics Devolution”

Over 75% of companies exchange data via MS Office or PDF

To This

IT Challenges �  IT and operations tends to follow business development,

resulting in firefighting

� Only 25% of companies surveyed have an a strategy on how they will approach externalization

� Vast majority of companies tactically share data with partners via MS Office-based exchanges

� A minority of companies enable partners direct access to systems

� CROs stress increasing with the number of client systems

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R&D virtualization is the biggest challenge facing biopharma IT organizations over the next ten years


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Research Virtualization is Altering the Vendor Landscape

Newer Entrants Major Investors

Tech Companies Coming into Life Science Driven by Externalization

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“Solutions” tend to be collections of niche capabilities. This is generally not a problem when working with functional partners

The trend toward programmatic partners results in multiple software deployments with incompatible security architectures

Challenge with Vendor Solutions

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There will never be an acceptable vendor solution that scales across R&D Standards help, but do not solve the problem (reference DICOM, SEND, CDISC, AniML,…)

Something(s) to Think About

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There is No Single Solution Across All Partner Scenarios

Relationship �  Functional or Programmatic? �  Strategic or Tactical?

Process

Data

Trust

Systems

�  What is the workflow? �  One way or bi-directional?

�  What data need to be shared? Structured or unstructured? Both?

�  A standard, our format, or theirs?

�  Will they use our system or theirs? �  How will systems communicate?

�  What is the level of trust? �  What levels of access is required?

Partner Strategies are Customized Based on Risk Analysis

Relationship Trust Process Data Systems Implications

Programmatic Full strategic partnership in disease area

Highly trusted, shared risk

Bi-directional sharing of program data

Large number of file types. Agreement on formats

Shared technologies Treat as extension of internal resources. Common formats

Programmatic Strategic partner for a target

Trusted, but only for specific projects

Bi-directional sharing of specific project data

Large number of file types. Not agreement on formats

Can be shared technologies

Must convert data. Must secure by project

Functional Strategic technology partner

Trusted, but only for specific technology(s)

Bi-directional sharing of limited project data

Generally in client format

Often, partners use their own systems

Must segment data. Access to only technology area

Functional Major services partner

Long term relationship. Medium trust

Data mostly one way. Might be entire studies (e.g., tox)

In client format. Medium number of data types

Use of client systems Access to workflow. Must manage users and review results

Functional Major services partner

Long term relationship. Medium trust

Data mostly one way. Might be entire studies (e.g., tox)

In contractor format. Medium number of data types

Receive output from contractor

Not real time. Must convert data. No security worries

Functional Low cost services

Low level of trust but building as used more often

Data one way. Could be med chem, assay services

In client format. Low number of data types

Use of client systems Access to workflow but security worries. Must review results

Functional Low cost services

Low level of trust. Use infrequently

Data one way. Compound out, data back

In contractor format. Low number of data types

Receive output from contractor

Not real time. Must convert data. No security worries

�  Enterprise Content Management (ECM)

�  Business Process Management (BMP)

�  Identity management

�  Digital signatures

�  ETL services

�  Large file transfer

�  Site development environment

�  Integration services

�  Provisioning policies/procedures

�  Security policies

�  …

Create and Leverage a Common Toolbox Across the Partner Ecosystem

If you do not have master data, it is difficult to enforce “standards” on your partners

A Possible Future View of “Data Logistics”

Future State: •  Single ecosystem for data transmission

•  Business rules engine (BPM) to automate workflow and status updating

•  Large data set transfer

•  Staging

•  Master data management

•  Transformation and posting

Current State: •  Trapped data in MS Office and

PDFs

•  Email data transformation

•  Manual data review

•  Files scattered across servers

•  Manual data conversion

•  Lack of business rules

Staging Area

Bioassay

Images

LIMS

ELN

Docu-ments

Data Ware-house Transformation

and Upload Services

BPM Rules

Engine

Partner A

Transfer Services

Partner B

Partner C

Partner System

Cloud Data Management

Submission Portal

Data Review Partner D

Big Co Pharma

�  Virtualization is a trend blowing up traditional R&D models

�  It is essential to develop IT and information security strategies around externalization with the knowledge it may vary by partner

�  Treat IT as a partner and involve early in business development. Before developing new partnerships, consider the complexities of data and material logistics

�  Be open to the cloud, but carefully consider the consequence

Ending Thoughts

Externalization will radically change IT strategies and established modes of operation

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Thank You!

Questions?

Michael H Elliott

[email protected]

www.atriumresearch.com

Twitter: AtriumResearch

+1 877 638 6924

externalization and partnerships: the new wave of informatics

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