Partnering for better science

There are nearly 12,000 people within the AstraZeneca R&D community who all share a common aim: to bring life-changing medicines to patients as quickly as possible. Our efforts are evident in a rich research history that has delivered new treatments for gastrointestinal, cardiovascular, neurological and respiratory diseases, along with pioneering new and innovative treatments for cancer and infection that have redefined how diseases such as breast cancer are treated. Our internal research has been, and remains, the hallmark of our success.

Yet with all we could ever hope to accomplish, our work represents only a small fraction of the pharmaceutical science happening throughout the world today.

It’s clear that no company can rely solely on its own research laboratories if it wants to take advantage of the scientific and technological advances made on a seemingly daily basis. At AstraZeneca, our internal capabilities are supported by 1700 external collaborations and alliances with leading academic centres and biotechnology companies.

We have two internal organisations — Global Discovery Alliances and Global Licensing — working seamlessly with potential partners to augment in-house capabilities and build out our drug pipeline in specific disease areas. The result could be straightforward research collaboration or something more complex that includes milestones and royalties or even an acquisition.

Access to advanced capabilities

These partnerships have become an important component of our drug discovery and development strategy, giving us broad access to advanced capabilities in such areas as genomics, bioinformatics, chemical libraries, high throughput screening and product delivery systems. Our research collaborations can be the keystone for internal projects, helping to enhance productivity by focusing on the frontloading of safety assessment, drug metabolism and pharmacokinetics and other areas that have an impact on project quality and delivery.

It’s through partnerships that AstraZeneca is adding large molecule therapeutics — human monoclonal antibodies — to our traditional portfolio of small molecule drugs. Antibodies can help us tackle new attractive targets that are not feasible with small molecules. We worked with our research colleagues to identify preferred partners in this area. The result: equity partnerships were established with U.S.-based Abgenix in 2003 and with UK-based Cambridge Antibody Technology (CAT) in 2004. Partnering with both these companies has been a great way to kick-start our entrance into biopharmaceuticals.

From a scientific perspective, partnerships allow our people to work with some of the best scientists and latest technologies in the world. From a practical perspective, they provide real advantages to both partners.

In the case of our partnership with CAT, which focuses on antibody-based therapeutics for respiratory and inflammatory diseases, we are benefiting from its expertise in antibody generation and optimisation, process technology and early clinical skills. In return, CAT is benefiting from our extensive medical knowledge in the disease areas, drug development capabilities and commercial experience in global markets. From an outside perspective, this partnership has won kudos from the industry, receiving a 2005 Pharmaceutical Achievement Award as ‘Business Development Deal of the Year.’

Aggressive external strategy complements strong internal capabilities

Our business model embraces an aggressive externalisation strategy, with licensing, acquisitions and alliances broadening the scope and depth of our drug portfolio, extending from early discovery through development. The fact that we signed a record number of externalisation deals in December 2005, strengthening our mid- to late-stage pipeline in key therapy areas, demonstrates ways in which we’re exploring innovative partnerships. These deals include:

• A global development and commercialisation agreement with Protherics, headquartered in London, for its anti-sepsis product CytoFab™.
• An exclusive global licensing and research collaboration agreement with U.S.-based Targacept Inc. for the development and commercialisation of new neuronal nicotinic receptor compounds for treating cognitive disorders.
• A late-stage licensing and commercialisation agreement with U.S.-based AtheroGenics for a novel atherosclerosis drug.
• The acquisition of the UK biotechnology company KuDOS Pharmaceuticals Limited to focus on the discovery and development of oncology therapies based on the inhibition of DNA repair.

Our partnership approach is a flexible one, whether we’re talking about forming an alliance or in-licensing a product or enabling technology. Global Discovery Alliances, which I head, focuses on compounds and technologies in the early pipeline, before a candidate drug is delivered. Alliance directors are embedded within the research areas, working with discovery scientists, with the outcome being partnerships and technical collaborations that build our science base.

Once a candidate drug enters preclinical development, Global Licensing, headed by my colleague Mike Henry, takes the lead role. Like alliance directors, licensing directors are also aligned with the business, sitting on therapy area portfolio teams as core members. They work with development scientists, who are conversant in the science and technology, to identify the preferred external targets to be pursued.

Partnerships involving projects in development tend to be higher-value deals because they are further along in the pipeline. As projects move from principle testing to concept testing to development for launch, the value increases almost exponentially. Over the last five years, the cost of a late-stage licensing deal has grown nearly seven-fold, according to a recent report by Wood Mackenzie.

The market for deal-making has become increasingly competitive in recent years, as more pharmaceutical companies make external partnerships a larger part of their drug development strategies. We have to react much faster to opportunities while maintaining our disciplined approach. There’s no cutting corners or breezing through the due diligence process, because the result can be a bad deal. So we’ve put more resources on these activities, while increasing our skills and capabilities.

Flexibility, relationships, expertise make AstraZeneca an attractive partner

Our role is to orchestrate and facilitate the process, working with colleagues in R&D and in the legal, intellectual property and finance departments. The process of establishing partnerships follows a predictable series of steps, yet each step is unique to the specific deal being worked on. We’ve found that our willingness to be flexible in structuring deals with competitive terms make us attractive to potential partners. When large pharma companies are rigid about their strategies and what they want out of a partnership, you can predict there will be problems down the road.

Another thing that makes AstraZeneca an attractive partner is the value we place on building relationships. Deals are not made between companies; deals are made between people. We work on the basis of mutual respect for both the science and the people behind the science. To be successful, we look for the right project and also excellent relations with the people involved. This is something we nurture even as we’re negotiating the deal; it’s part of our thinking when creating the backbone of the project’s infrastructure. Building relationships becomes an important part of our first start-up meeting, and it remains important throughout the partnership.

We also lay a lot of groundwork with potential partners, helping to demystify the complex, global organisation that is AstraZeneca and providing a single point of contact for inquiries about possible collaborations. When you have 65,000 employees, as AstraZeneca does, it’s easy to be intimidating to a small biotech firm with maybe 100 people. We’ve found it particularly useful to get to know the people and the organisation before we even begin thinking about potential deals. We nurture these interactions by constantly talking to companies about their science. We go to scientific meetings and partnering conferences around the world. We also get regular updates from companies about their work, and we feed back to them the kinds of data or studies we look for in terms of the science.

Beyond partnerships, our externalisation strategy includes complementary business initiatives. One example is the strategic relationship we established in 2003 with Advent International Corporation, a private equity firm. In 2004, we became a major investor in an Advent venture capital fund that focuses on biotechnology, emerging pharmaceuticals and medical technology. We even placed an experienced senior research manager in Advent’s Boston office to oversee and coordinate our discovery venture activities, which include identifying and evaluating potential collaborations and product licensing opportunities.

Big pharma and biotech

We expect biotechnology will continue to have a growing importance in our work with each iteration of innovation, and our internal intellectual property and science dovetail nicely. We need to have good science in-house to be able to judge the science going on around us and to transform it into a deliverable drug. To that end, there is a continuing role for organic growth and external collaborations within AstraZeneca. Both approaches are necessary to achieve our targeted endpoint: delivering quality medicines to patients faster.

Not all our collaborations involve biotechnology; we have research partnerships and product licensing deals with Japanese pharmaceutical companies and mid-size European pharmaceutical companies. But our list of biotech collaborations is much longer and growing at a faster pace.

With biotech partners, money is always of immediate interest to fund research, but it’s not all that’s necessary for a successful collaboration. There needs to be high scientific standards, an understanding of the disease area, extensive development capability, and the ability to absorb the risk if the product fails in late-stage trials. If the product proves successful in clinical trials, there needs to be a knowledgeable organisation to interact with regulatory authorities around the world and to deliver commercial success. Those are the kinds of things, besides money, that AstraZeneca brings to the table.

True partner

When we started our efforts, nobody really knew who AstraZeneca was. That’s not surprising, considering the merger of Astra and Zeneca only occurred in 1999 — a brief moment ago in the realm of pharmaceutical development.

Now we are a proven and preferred player, having achieved a strong internal R&D organisation complemented by a regular stream of mutually beneficial alliances and licensing deals. In a recent study by Silico Research, we were ranked one of the top partners by academic institutions. It’s clear that we have succeeded in putting AstraZeneca on the map in a relatively short time.

Our partners tell us that we’re the kind of people they like doing business with; they trust AstraZeneca. We work hard to earn that trust, building personal relationships at multiple levels with our partners. We consider ourselves a collaborative team aligned toward the same goal, and we attempt to minimise turnover so there is continuity in our relationships.

With all our thousands of successful partnerships, we always want to do more. We are happy to talk with companies about their science, projects and products. As we see things, it’s all about building relationships for the future.

That first discussion may not result in anything concrete, but it opens the door for continuing interactions. We may not be interested in their work today, but you can never tell about tomorrow. Some companies are persistent, some conduct additional studies based on our input and sometimes our strategies change.

That’s why our approach is to be open to new ideas, continue the conversation and never say never.

Building relationships is a process that has no end.