A couple of weeks ago there was a piece on In the Pipeline on the emergence of CROs taking up the slack left by the lay-off of many big pharma drug discovery scientists. I worked for such a company for a number of years and I thought it might be interesting to talk about it here.
The company initially started after a round of lay-offs at a big company and was set to service the growing combi-chem and parallel synthesis boom of the late 90s into the 21st century. It would also provide scale-up and process work, with a developing GMP program. These helped the company make it through the first two years of its life.
However, it was not sustainable, as library synthesis was not viable. We could provide very high quality compounds, via a high throughput purification system developed in-house, but the system did not prove to be the golden goose we hoped and the growth of companies in Asia meant that the market for libraries was in any case very tight. The process group grew but the library group transitioned into more MedChem projects, which is the main part of what I want to talk about – it was where I spent most of my time after all.
How it worked for us in med chem was we would be presented with a project (in varying detail and with varying amount of leeway in our allotted tasks) with some fixed length of contract. Most were annually renewable and many continued for multiple years. The customers in question were a mix of pharma and start-up: for the established players, we were outsourcing for a project they did not have the internal capacity for (usually because there were more pressing projects and/or synthetic challenges to overcome). For the start-ups, we were their chemistry department. Usually, when projects began we were more or less told what to do, biological data was shared sparingly and feedback was limited. As projects progressed, these restrictions loosened, giving a mutually beneficial relationship where we could show our value. Sometimes this reached the stage where some kind of risk-sharing was possible, in the form of a milestone payment for successful progress to the next stage or a bona fide collaboration. The In the Pipeline I linked to mentions CROs as less innovative but that is only partially true – when we were given leeway to come up with novel structures, then we delivered. If the customer just told us what to do then obviously we could not innovate.
I think it is fair to say that we did not have the resources of a big pharma, but we had what we needed. The company were careful with the capital budget, but when something was really important, they found a way. We had nice lab space, an organized chemical inventory, the much needed purification and analytical tools. Not in abundance and sometimes you would need to wait for an Isco or a rotavap. But things got done. The company was also proactive in adding capabilities that helped us do things better. A DMPK group was established to do some of that work in house rather than wait for an over-run client’s group to run the assays. One other thing I think they did was maintain a higher safety standard than you might be able to get away with. It was good for the company on every level really, but a bad safety record could easily affect whether you got a contract or not.
There has been a certain amount of outsourcing in drug discovery for a while now but that does look like it will increase with the lowered internal resources for research. I don’t know that it is an ideal solution for Big Pharma to use smaller companies for each facet of the drug development process, but it can work. There is certainly the talent out there – if they remain in the pharmaceutical industry at least. Perhaps it will enable companies to manage their costs better. Finding the right partners for such endeavors does seem to be the key and there is a definite opportunity for up-and-coming companies to make a name for themselves.