Archstone Consulting Study Identifies Alliance Management Trends/Issues In Pharmaceutical Industry

Advisory Board Formed with Key Alliance Management Executives

Stamford, CT – Archstone Consulting's Life Sciences Group has completed an in-depth study revealing key trends in Alliance Management from both a co-development and co-promotional perspective. The study, which included pharmaceutical and biotechnology firms, concluded that current management practices in many organizations, while still evolving, are not yet sufficient to address this growing industry need.

"Many pharmaceutical manufacturers are accelerating their use of alliances to source compounds. In fact, annual spending on alliances has increased by 50% in each of the last four years. Further, these relationships can last for many years through commercialization. Our analysis focused on determining if these alliances were achieving success in practice and if there was anything systemic to the capabilities that differentiated extraordinary success from less than successful alliances," stated Mark Mozeson, Principal with Archstone Consulting's Life Sciences Practice.

Jonathon Fox, who directs Archstone Consulting's Alliance Management offering, asserts "many of our clients and contacts in this area agree that as an industry there are significant opportunities for improvement. There are firms that do pay more attention to key elements such as proactively managing the alliance relationship, implementing effective governance structures, and ensuring the appropriate levels of process and training. Those firms typically have more alliance relationships and have done a better job identifying opportunities to standardize processes and capture and implement best practices. Another recent trend we have observed is the desire to evaluate, score the performance of, and improve the alliance. More are proactively reaching out to their partners for honest, open feedback on how well the working relationship is functioning."

"One area where many companies, but not all, really need to step up is in providing training for new alliance team members. Our experience indicates that these teams turnover at a rate of anywhere from 33% to 50% a year. How do you not institutionalize a systematic training program under these circumstances? Also, alliance managers need to be more involved earlier in the alliance management process in order to ensure the deal can and will become operational," continued Mozeson. "Our clients live with these deals for years and the terms are normally agreed to by people who may not be on the scene after the contract is signed."

Advisory Board Formed
Based on the need to address these and other strategic issues, Archstone Consulting is forming an Alliance Management Advisory Board (AMAB) with key alliance management executives to address the needs of this emerging dimension of pharmaceutical operations. "We will collaborate with Michael Leonetti of Boehringer Ingelheim to launch and Chair the Advisory Board. Mr. Leonetti is a seasoned professional who has achieved much success for BI in this area and is chairman of the Global Association of Strategic Alliance Professionals," stated Mozeson. In addition to Boehringer Ingelheim, the AMAB will include firms such as Bristol-Myers Squibb, Centocor, Millennium Pharmaceuticals and other major pharmaceutical and biotech firms.

"Our practice has developed frameworks and tools to help our clients address this unmet need." stated Fox. "Many companies simply have been running so fast to source compounds – they may not have had a chance to appropriately address these issues. However, that is changing and we expect that life science firms will increase their focus on the capabilities required to maximize the value of their alliances."

SOURCE: Archstone Consulting