Outsourcing manufacturing and clinical-trial materials is an important part of pharmaceutical companies' strategy for drug
development and commercialization. The outsourcing model, however, may be applied earlier in the drug-development continuum
to include research and development (R&D). Gonghua Pan, associate director and head of the parallel medicinal chemistry (PMC)
sourcing operations at Pfizer (New York), explains the company's approach to outsourcing R&D, including the role of offshore
contract services providers.
Drivers for increased outsourcing
On an industry-level, Pan outlines the drivers for increasing R&D outsourcing. These include:
- Access to additional R&D capacity
- Access to expertise
- Access to novel enabling technologies
- To focus internal resources on core competencies
- To accelerate speed of development
- To obtain operational flexibility
- To reduce fixed costs.
Origins of research sourcing at Pfizer
Pfizer first began outsourcing certain R&D functions in the late 1990s. At that time, Pfizer had a strategic goal to increase
the size of its compound collection generated by PMC techniques. PMC refers to using combinatorial chemistry and high-throughput
screening to generate large libraries of compounds for testing for biological activity against a disease screen.
"PMC technology at this time was viewed as a specialized technology that was platform-centric, capital-intensive, and IT-intensive,
which required a specialized skill set," explains Pan. "The company used strategic alliances to gain access to this technology."
In 1999, Pfizer signed multiyear collaborations to access PMC technology with four service providers: the UK business of Tripos
(St. Louis, MO), Discovery Partners International (DPI, San Diego, CA), Arqule (Woburn, MA), and ChemBridge (San Diego, CA).
Pfizer ended its drug-library agreements with three firms (Arqule, DPI, and Tripos) in 2005.
During the early 2000s, the business environment for contract drug-discovery services evolved, and several of Pfizer's early
collaborators exited the market. Arqule, one of the largest contract research organizations (CROs) in the US, exited the contract-chemistry
services business in 2005 to focus on developing its own oncology drug portfolio. DPI sold its drug-discovery service operations
to Galapagos (Mechelen, Belgium) in 2006. Tripos sold its drug-discovery informatics division to Vector Capital in 2007, which
created a separate and new privately held company Tripos Discovery Informatics (St. Louis, MO).