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BEST PRACTICES partnerships By E. Miseta MAXIMIZING PHARMA PARTNERSHIPS: DOS AND DON'TS FROM INDUSTRY EXPERTS LIFESCIENCELEADER.COM THE CMO LEADERSHIP AWARDS 2015 46 the pros and cons of the partnership and have one unified development plan moving forward. "I believe 70 to 80 percent of small companies fail because there is not open sharing of information between the companies," noted one panelist. "The pharma company will have one view, and the biotech will have another. The pharma company will present its outlook to the management team and the portfolio man- agement. If the biotech company is looking at it in an entirely different way, that will be a problem. Having both teams call into the same portfolio review will dramatically lessen that situation and increase your chances for success." THREE SCENARIOS — WHICH WILL YOU PURSUE? When a small bio company approaches Big Pharma about partnering, they are generally hoping to land one of three types of partnering agreements. 1 WE NEED AN INVESTMENT OF MONEY. 2 WE NEED ACCESS TO YOUR EQUIPMENT AND SOME SPACE. 3 LET'S CODEVELOP THE PRODUCT AND USE YOUR SALES FORCE TO PROMOTE. The scenario will determine the type of agreement put in place. The most straightforward agreement is one where an asset has been validated and is ready for licensing, and where a Big Pharma partner is needed to help develop it. The agreements get more complicated when dealing with an earlier stage product, where there might be some potential, but there are a lot of question marks. In this case, a sponsor research agreement might be the best route. Here again, trust enters the discussion. No one wants to spend six months on an agreement for a project that will maybe last three months. Everyone is looking out for their own self-interest, but it pays to understand both sides. Rather than ask what they can do for you, consider what it is addition to the validation, Big Pharma partnerships also reduce risk for a small company, cutting the R&D; burn rate and allowing the company to tap into the resources of a much larger company. Of course, structuring these deals is all part of the negotiating process. And while Big Pharma has a lot of negotiating experience, many smaller companies may be lacking in this area. That means trust between the two sides is critical to the process, a theme that came up several times during the session. Engaging slowly, then building around the trust you develop along the way, can be an effective way of fostering a partnership. Still, it is best to have as much knowledge as possible when entering the negotiation process. Do your homework, and talk to companies that have been through the process, especially those with expertise in your area of research. And be prepared to lose some level of control over the product once you enter into a partnership. Finally, having a shared vision is critical. Both sides need to be ready to share both Maximizing Pharma Partnerships: Dos And Don'ts From Industry Experts In today's life sciences industry, the most common type of partnership seems to be pharma partnering with pharma. But how do you determine if this model is right for you? f it is, how should you then identify partners, come to an acceptable agreement, and execute the part- nerships? Life Science Leader assembled a panel of experts at the Outsourced Pharma West Conference & Exhibition to answer those very questions. The panel consisted of Christopher Haskell, head US Science Hub, Bayer HealthCare; Brian Feth, CEO/founder, Xcell Biosciences, Inc.; Glen Sato, partner, Cooley LLP; Jaisim Shah, CEO and board director, Semnur Pharmaceuticals, Inc.; and Timothy Scott, president, Pharmatek. PARTNERING WITH BIG PHARMA The first question posed to the panelists centered on smaller pharma and bio companies partnering with Big Pharma. The consensus opinion seemed to be that the greatest advantage of this relationship is the credibility and validation it brings to the smaller company. "It says a lot for a large pharma company to direct money and resources into any project you might be working on," noted one panelist. In I E D M I S E T A Executive Editor @ OutsourcedPharm