Industry Overview

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Industry Overview

The pharmaceutical licensing environment is increasingly competitive, with a common recognition amongst multi-nationals (MNCs) of the need for collaborations with BioTechs and research foundations, as they endeavour to de-risk early-stage and expand late-stage pipelines, whilst streamlining R&D resource and associated costs

Late stage assets are still of high strategic interest to MNCs as IP expiry of blockbusters and the subsequent genericisation are set to significantly reduce revenues in the mid-term. Poor translation from PC models is another reason why assets with clinical data secures more traction, especially if the assets under discussion target therapy areas of interest and are associated with recognised mechanisms in line with Major’s partnering focus. Poor translation is a particular issue for neurodegenerative disorders and inflammatory diseases. However, progressing promising drugs through Phase 2 trials is overtly expensive for many BioTechs

In order to fill pipelines with innovative drugs, many Majors are keen to collaborate with biotechs, research institutions and academia on early-stage assets – whether collaboration is via part-funding towards defined end-points, with Options for later license, or funded through their Venture arms

In addition, the generic environment is expanding apace as the emerging regions become more expert in re-formulation & API manufacture, more efficient in their processes and more extensive in their geographic reach. Many MNCs are considering or adopting branded generic strategies, partnering with expert generic houses to prolong revenues of their core mature assets. In addition, as the pricing environment becomes more challenging in the US and Western Europe, combined with a governmental drive for enhanced competition to enable more widespread availability of medicines, MNCs are focussing more attention on geographic expansion into the Emerging World through acquisitions and partnering initiatives. Key considerations for deal making strategies now include commercialisation in China, Korea, India, Turkey, Russia, Mexico and Brazil.