Anyone tracking drug development deals these days will already know that Big Pharma's trigger finger is getting increasingly itchy when it comes to killing unwanted or unsuccessful collaboration pacts. When FierceBiotech reviewed the data gathered by Deloitte Recap late last year on the top deal terminations of 2010, "pipeline reprioritization" was most often cited by Big Pharma when bailing out on a biotech partner. And Rigel, S*BIO, Targacept and Metabolex all experienced in recent weeks what it feels like to be abandoned after the honeymoon phase.
BioWorld has been keeping its own stats, noting in an analysis that 13 deals have been terminated so far this year, compared to eight at the same point last year. Deloitte Recap's Chris Dokomajilar explains to BioWorld that these days Big Pharma has been concentrating on cutting costs. And that new focus is translating into a higher failure rate for partnerships. "We're going to see more terminations and at earlier stages," he tells BioWorld. "It costs a lot of money to keep programs going, and there might be more value in terminating."
If a biotech is handed back the rights to a program, says Dokomajilar, the best response may be to steer clear of any cancellation payments--which are likely to have complicated strings attached--and go for the clean break. That way a biotech has a better shot at re-partnering later after having had the chance of enjoying R&D support from a departing pharma group. These days, you're better off going into a partnership with a backup plan in mind.
- see the story from BioWorld
Special Report: Top deal terminations of 2010