Over One-Third Of Pharma Alliances Are Unsuccessful Due To Unrealistic Expectations, New Report

Main Category: Pharma Industry / Biotech Industry
Article Date: 24 Oct 2008 - 3:00 PDT

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In 36% of deals, partners in pharma business alliances are dissatisfied with the partnerships because they later learn that their expectations were unrealistic, according to a new report.  "Business Development: Accelerating the Deal," published by Cutting Edge Information, provides examples from dozens of business alliance managers on how to manage expectations, resolve conflicts, and achieve high-quality results from pharmaceutical alliances.

Some goals must be identified in the due process phase -- for instance, exit clauses on both sides of a deal ensure that a partner will not be trapped inside of a deal that is no longer advantageous to the company. Other objectives, such as expected timelines for clinical trial completions, can be communicated, managed, and even hastened with strong communication and a willingness to commit resources as needed on both sides of a partnership.  Steps such as these can reduce dissatisfaction with deals.

"While market factors or failed clinical trials can also lead to unsatisfactory partnerships, these cannot always be predicted in advance," says Eric Bolesh, lead author of the study.  "With strong lines of honest communication on both sides of a partnership, aggressive and realistic goals can be identified by both companies in most cases.  If a goal is unachievable, morale and results are likely to suffer throughout the course of the deal."

The insights within "Pharmaceutical Alliance Management" prevent these pitfalls, giving guidelines for effective partner communication and internal coordination to ensure continuous alliance satisfaction.

More than 50 companies contributed to the study, which contains 150+ metrics, including the following: 

--  Resource support for alliance management groups
--  Prevalence of dedicated alliance management functions, by company size
--  Levels of historical deal satisfaction
--  Underlying reasons for unsuccessful deals
--  Key deal challenges
--  Inbound deals: functions involved in post-deal day-to-day activities
--  Outbound deals: functions involved in post-deal day-to-day activities
--  Use of alliance health surveys
--  Tools of the alliance health department
--  Surveyed companies' communication models
--  Steps to partner-of-choice status

    For a complete licensing picture, Cutting Edge Information also offers "Pharmaceutical Alliance Management," bundled with "Business Development: Accelerating the Deal."  Together these reports provide guidance and benchmarking figures from the beginning stages of licensing -- deal identification and due diligence -- through complicated deal negotiations and the ever difficult task of alliance management.

For more information on the new alliance management study, as well as the recent business report, please visit http://www.PharmaDealMaking.com.

http://www.PharmaDealMaking.com

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