Continuing along the same line as last week’s article featuring Volvo IT and technology scouting, this week we’re discussing a tangible example of partnering success – AstraZeneca. In this interview, Shaun Grady, VP Strategic Planning and Business Development at AstraZeneca discusses the successes of 2012 and explains some of the activities AstraZeneca has undertaken in order to revamp their partnering program and be a top partner. Check out the video below:
There are a few points made during the interview that particularly standout, such as the future of peer-to-peer collaboration in the life sciences industry, the benefits of long-term relationships and advice on how to be a partner of choice.
The future of collaboration
From the interview it’s clear – collaboration is on the rise and it’s getting more complicated. The joint-acquisition of Amylin by AstraZeneca and Bristol-Myers Squibb, a complex, two-step deal, is excellent evidence of this fact. The deal has garnered a lot of attention for AstraZeneca, including from potential partners interested in completing a similar deal. It’s easy to see why other organizations are interested, such a deal allows cost and risk sharing in addition to maximizing the impact of each company’s resources and expertise. However, it’s not a matter of simply finding a good opportunity and a suitable partner. Due to do the complicated nature of many deals, a fair amount of trust is also required.
Developing innovative deals like the joint-acquisition of Amylin is more feasible when in the context of a long-term, successful relationship like that of AstraZeneca and BMS. To secure the deal most efficiently, BMS approached Amylin alone, requiring an enormous amount of trust between BMS and AstraZeneca. In fact, the two companies have such a high level of mutual trust that they were able to leave amendments to their collaboration agreement until after deal conclusion. This, of course, begs the question, how can organizations secure promising partnerships and develop them into strong alliances?
Attracting and developing robust alliances
A key first step towards a successful alliance is attracting the most promising opportunities. As BCG’s Biopharmaceutical Partnering Survey – 2012 Results explains, sell-side partners are looking for someone with value creation expertise and core partnering skills, such as creativity and flexibility on deal terms, responsiveness during negotiation and executive leadership committed to partnering. AstraZeneca’s partnering program revamp reflects many of these concerns. For example, AstraZeneca set the ambitious goal of improving responsiveness by answering unsolicited proposals within 24 hours, then following up in a week with a more detailed response. Additionally, in an interview with pharmaphorum, Mr. Grady explains that they consider every deal to be unique, tailoring each to fit the requirements and identity of the partner while still satisfying AstraZeneca needs.
After a deal has been secured, concrete steps must be taken to develop trust, such as carefully and consistently fulfilling all contractual agreements, both financial and non-financial. Additionally, it’s important to introduce controls to govern the alliance and any issues that may arise both transparently and effectively. At AstraZeneca, they’ve implemented a system of tools, checklists, templates, trainings and health checks, providing all of their alliance managers with the support they need to excel. In the last 18 months, AstraZeneca has been striving to differentiate themselves as an excellent organization for partnering opportunities and the results are beginning to show.
Excelling in partnering and alliance management
Judging from the BCG report, the hard work done at AstraZeneca is paying off. Not only did AstraZeneca come out on top in terms of access to the BD/Licensing group, but as the graph below shows, they’ve made it into the top 6 for all 3 major categories, a big move from 2010.
Partnering clearly brings big benefits, but doing it well requires organizations to establish best practices and develop essential capabilities. In particular, many organizations suffer from disjointed, legacy systems that do not effectively manage both contacts and assets. These organizations need to implement a unified system to streamline and coordinate their partnering activities. Further, as BCG suggests, companies cannot simply launch partnering best practices once and declare the job done, they must stay on top of their game. The reshuffling of the top ranked companies shows that perceived performance is highly susceptible to decline, it only takes a couple years to be displaced – complacency is not an option.