Wednesday, December 17, 2008

Consortia -- Pre-Competitive Is In the Eye of the Beholder

It is hardly news that drug development is high-cost and high-risk. What is relatively new is for pharma to lower their guard and begin to share information that action together that may potentially reduce cost and risk. Enter the era of the pharma industry consortia.

Perhaps the grandparents of this space are groups such as the Biomarkers Consortium and the SAE Consortium. The C-Path Institute was created, in-part, to create consortia to act upon the FDA's Critical Path Initiative. Where there has been a lack of sound business models for creating new tools for drug development, consortia have been a good solution.

The ability for otherwise competitors to suddenly collaborate is based upon what some have called the “pre-competitive space”. At least one group has defined this as “technologies that aren’t really the basis on which they are competing but helps them do their jobs.”

But there is an inherent conflict. By their very design, consortia are meant to be inclusive and bring representatives from various related areas around the table. But what is pre-competitive to one stakeholder is likely a key revenue source, business opportunity, or competitive differentiator to another stakeholder. In most cases, “pre-competitive” is in the eye of the beholder.

Today it seems not a week goes by without another new industry-wide initiative being launched. Each requires an investment of resources and a commitment to see value ultimately generated.

Impact on drug development? Consortia have emerged as important mechanism for improving the clinical development toolbox (biomarkers may be a good example). But each initiative must start with an honest discussion among stakeholders around the table about what is truly pre-competitive, and whether everyone sees the same opportunity in the same light.

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