Big Pharma Sees Value In Using Small Drug Discovery Units
April 15 2009 - 12:54PM
Dow Jones News
As big pharma gets bigger, many large drug developers are
finding that it makes sense to discover new development compounds
by using small research groups.
Although recent deals, like Pfizer Inc.'s (PFE) $68 billion
purchase of Wyeth (WYE), seek to increase efficiency, many
companies are using smaller research groups in order to emulate the
innovation seen at much smaller biotech companies.
"We believe that the big research organization model really
doesn't work particularly well," said Rod MacKenzie, head of
worldwide research at Pfizer.
The comments came from a panel discussion at the Windhover
Pharmaceutical Strategic Outlook conference in New York on
Wednesday.
MacKenzie said the old model was too unwieldy, lacking
accountability, and overly bureaucratic. It wasn't uncommon to have
multiple groups working on similar programs in multiple locations
throughout the world, he said.
The newer model, which uses drug discovery units of 100 to 150
researchers, seeks to counteract those issues.
"We try to marry the strength of biotech spirit and
entrepreneurship with big pharma's resources," said Zhi Hong, head
of GlaxoSmithKline PLC's (GSK) infectious diseases drug-discovery
division.
Glaxo is using a similar program to Pfizer in using smaller
groups of researchers to become "biotech-like" in their flexibility
and interactions.
Bristol-Myers Squibb Inc.'s (BMY) head of discovery Francis Cuss
noted the mid-sized company isn't as worried about "being too big,"
but that it is also making similar moves.
The company has about 1,200 people in its discovery division,
the same number as it did back in 1991, which is a stark contrast
with Pfizer's 3,300 people working in its discovery programs.
Cuss tried to compare Bristol's structure with biotech giant
Amgen Inc. (AMGN), rather than other more traditional
pharmaceutical companies.
"What we are trying to do is completely change the culture, or
at least more in the direction of that looser biotech culture," he
said.
Amgen's research head, David Lacey, noted that its organization
is similar in size to Bristol's, but stressed the importance of
keeping researchers in smaller groups. As a biotech that looks more
like a mid-size pharmaceutical company, Amgen has tried to ensure
researchers feel like they have a "stake in the game."
But as these companies get larger and attempt to find innovative
drugs, some also are becoming more dependent on external sources of
finding new compounds to develop.
MacKenzie notes that Pfizer currently derives 20% of its
discovery research from biotech and academic collaborations, but he
estimates that figure will rise to 30% by the end of the year.
In contrast, Amgen estimated its external discovery research
remains at about 10% to 20% of its total.
-Thomas Gryta; Dow Jones Newswires; 201-938-2053;
thomas.gryta@dowjones.com