Both sides of the fence

What lessons can we learn from those who have worked for both pharmaceuticals companies and CROs? Session chair Andrew Warmington reports from PharmaChem Outsourcing 2012

PharmaChem Outsourcing, which takes place every year in Long Branch, New Jersey, takes most of its conference content from panel discussions between industry executives. This year, one panel entitled 'Both Sides of the Fence' was unique in that the panellists were themselves the theme. All seven had crossed from pharmaceuticals - Big Pharma, Small Pharma or biotech - to contract research or vice-versa, in some cases more than once.

All of them thus had a more rounded perspective on the issues that face pharma companies and CROs in working together, varying with their personal experiences, and were more au fait than most about the challenges and frustrations involved. They also now know things that would have been useful to know on the 'other side of the fence'.

Dr Jim Hamby is a medicinal chemist by training who spent 19 years working for Warner-Lambert then Pfizer. He had planned to stay in this line even after leaving in 2005, until a mutual friend introduced him to Dr Stephen Munk, CEO of Ash Stevens, where he is now VP of business development.

"I had no background in business development or sales but I enjoy the role," he said. "As a scientist I was narrowly focused on my work, now I have a much broader view of industry. My experience in drug discovery helped a lot. I thought I knew about development as a medicinal chemist but I now realise there is much more to it."

Also Michigan-based and also a Pfizer veteran but via Upjohn then Pharmacia, Dr David Zimmermann, now CEO of Kalexsyn. Zimmermannspent 23 years in Big Pharma up to 2003when the Kalamazoo site closed. There, he said, he had gained considerable on-the-job training via his responsibility for external collaborations.

“I had no clue what to do when I left but I wanted to stay in Michigan. At that time, I saw few CROs practising the art of medicinal chemistry and achieving high levels of problem-solving capability. I founded Kalexsyn to address those needs. We have a simple fee-for-service model with scientists who average ten or more years of experience,” said Zimmermann.

Like Hamby, Dr Susan Billings was a traditional medicinal chemist. She had expected to spend up to 15 years doing this after graduation, never envisaging working in sales or business development. After moving from TetraLogic Pharmaceuticals to Merck & Co., she went into project management and sourcing. This opened her eyes to outsourcing strategies and the emerging CRO landscape.

As lay-offs followed mega-mergers, Billings left to become business development manager at AMRI. “My biggest challenge was being asked to step out of my comfort zone and not just talk about chemistry and scale-up. Initially, I was not very comfortable with biology, DMPK and other areas,” she said. “Now I have learned a tremendous amount, not least being comfortable with people at all levels and communicating in the appropriate way and about what we are and aren’t good at.”

Dr Jennifer Trevor began slightly differently as a forensic chemist at the US Drug Enforcement Administration, spending much time working with contractors. The knowledge she gained there of quality audits and what to look for in suppliers led to a role as API development manager at Amylin Pharmaceuticals. Since 2010, she has been senior business development manager at Ferro Pfanstiehl.

"If I could go back, I would have been a tougher negotiator at Amylin," Trevor said. "I've realised everything is negotiable and some things need to be challenged, but it can always be communicated politely."

From the 'other side', Dr Maxwell Reeve began as a medicinal chemist in pharm, then spent five years at AMRI, where, he said, "I was fortunate enough to see the CRO business all the way through to manufacture". He is now associate director of chemistry manufacturing management at RibX Pharmaceuticals, a clinical stage biotech focused on novel small molecule antibiotics.

"I would have liked to have known more about each stage of the process," Reeve said. "Understanding the importance of communication, especially when working with offshore companies, and what motivates people, as well as relationship-building - these are all crucial."

Dr Kamlesh Sheth, meanwhile, is another medicinal chemist who spent seven years as a process chemist in cGMP scale-up at the former Rhodia Chirex, then ten at the biotech Amicus Therapeutics. He left partly because he felt that something was missing: ownership of the project was always temporary and once it was shipped out one rarely gets to know what, if anything, happens to the molecule.

Sheth now works with CMOs as senior investigator in drug substance development for Amicus, which focuses on rare lysosomal storage diseases. "My experience on both sides has taught me that both the CMO and the client side should evaluate each other's fitness for partnership, because partnership is the motor of innovation," he said.

Curtis Cui, CEO of Hongene Biotechnology, uniquely, is still active on both sides of the fence; Hongene offers CRO and CMO services in addition to manufacturing nucleosides and nucleotides. Originally, he was a process chemist at DSM Pharmaceuticals, then at Eli Lilly and Inspire Pharmaceuticals (now part of Merck), before four years with an API development firm in China.

The word that is always mentioned in the context of relationships between pharma companies and CROs is 'communication', with the emphasis on openness, clarity and regularity. But how much? Of what kind? Can there be too much? Some panellists thought that this is at least possible. When she was in pharma, Billings did find some CROs reaching out too often.

"But then if you don't reach out, some important information can get lost," she said. "About once a month is about right if you are trying to get in front of someone new. From a commercial point of view, it is important to bring in your technical specialists as early as possible. On the business side, you should ensure you are keeping things moving and be there when it is time to negotiate."

A common failing, Zimmermann noted, is that CROs do not send the latest report until just before a teleconference stats, so too much time is spent going over this rather than planning ahead. Now, Kalexsyn always sends out the report on Thursday or Friday for a teleconference on Monday, so that  participants can focus that on problems and strategies for the week ahead.

"We also insist on all the scientific people being present so that any technical detail can be addressed and use electronic notebooks (ELNs) so that all research data can be noted down in a consistent and timely way. All too often, business development people are MBAs without a scientific background, who cannot answer the key questions that arise in the meeting," he added.

All that begs the question of what the role of the business development manager should be at both ends. At what point, if any, should he or she should get out of the way and let the chemists get on with things?

"It depends on the person who made the contact and whether it is an innovative or standard process," Hamby said. "Once you are fully into technical matters, the technical people are best suited to being involved and you should fade out. You might stay in contact to ensure that the client is getting the attention he needs, but it would be essentially a supportive role."

"The key is to ensure that you are on track with the project," said Trevor. "There will be many emails back and forth but you must also ensure there is some sort of living document that you can reference. Managing expectations is crucial to keeping both sides happy. Scientists can be very focused on data and so may be insensitive to the vibe between companies."

Reeve added that there are many different ways to manage a project and none is necessarily right or wrong. Often the role of the business development manager at the very start is confused: it might be business, or project management, or both. This is not an issue as long as it is understood. "It is usually better if projects run without too much business in the background and that all responsibilities are crystal clear."

Does Big Pharma actually want feedback from CROs? Most on the CRO side think it does, though this has been a recent development in some cases.

"Five years ago, Big Pharma had a big ego. Now things are changing and CROs and looked at very differently," said Zimmermann, adding that Kalexsyn works mainly with Small Pharma and biotechs. "15 years ago, the scientists who couldn't find work with Big Pharma went to CROs and the attitude was 'Big Pharma knows best'. Now many of these scientists are at CROs and we have top calibre people working for us."

Both Trevor and Hamby agreed that Big Pharma has changed a lot, albeit that working with smaller companies is generally easier. Billings added that it is not about waiting for Big Pharma to ask so much as being in a position to give information that might be required, even only if it came up over lunch with the procurement manager.

When crossing the fence, of course, something has to be lost. What do those who have done it miss from the 'other side'? Cui and Zimmermann mentioned simple involvement in lab processes, Reeve the chance to be involved in 30 projects/year instead of three, Hamby the sheer creativeness of science, Billings the ability to ignore emails now and then. It comes down to the choice between 'wide and shallow' on one side and 'narrow and deep' on the other.

Asked, finally, what their biggest hope or concern was for the future, Hamby cited funding. With fewer of the start-ups that are the CROs' lifeblood in the field, venture capitalists are tending to work with the entrepreneurs they already know and fund them for two to three years to get a development candidate and this is typically taking five years.

Zimmermann said that he hoped for more implementation of technology such as ELNs to capture data in a searchable, scientific way. He expects to see a growing ability to port data from the CRO to the pharma company. Likewise, Reeve expects to see more ELNs and maybe fewer teleconferences as the technology advances. Much has changed in outsourcing in the past ten years and the pharma industry has got better at it, but there will still be a fence in ten years' time.

"I can already see some outsourcing moving back from emerging markets to the West and that will continue as people start to ask what they were getting from Asia, especially as costs rise ther," Billings said. "Europe will also see more venture capital involvement and more virtual collaborations using leading CROs in the field to deliver programmes at lower cost worldwide."