The drug discovery and development environment is occupied by different species of organizations.
The drug development landscape is changing. Pharmaceutical companies are experimenting with new collaboration and incubator models to feed their drug development pipelines. The National Institutes of Health (NHI) Roadmap initiative and the Clinical and Translational Science Award are nurturing academic efforts to enhance their role in drug development. Linking these efforts is becoming increasingly important as the average drug now passes through several organizations from discovery to clinical trials to FDA approval.
Bioscience-focused independent research and development institutions (BIRDIs) are hybrids of the better-known academic and commercial fauna. They conduct basic research like a university, but many also incorporate a strong commercial focus and translational infrastructure. As such, many can discover new drug candidates and carry leads through preclinical development steps that are beyond the capacity of the average university. The hybrid structure of BIRDIs also interfaces well with commercial partners seeking to sponsor specific research and generate new drugs for their pipelines.
BIRDIs can function as a “virtual” company, developing a project in collaboration with an academic institution and licensing at a later stage to an established commercial partner for advanced clinical testing and marketing. At a time when start-up funds and initial public offerings are rare, this incubator model offers an alternative for building value in a discovery and leverages the hybrid BIRDI to bridge the gap between academic and commercial worlds.
Many BIRDIs flock together in an aerie named AIRI, the Association of Independent Research Institutes. This umbrella organization includes 87 independent, nonprofit member institutions, which collectively receive more than 10 percent of NIH extramural funding. But like any denizen of a complex ecology, AIRI and non-AIRI independent institutions must find their niche, and survival requires both scientific rigor and a strong business discipline. Many are specialized, with a therapeutic focus. Others conduct R&D in a wide range of scientific disciplines. These independent centers are important sources of new drug leads. Sharing characteristics of both academia and industry, they can also serve as a critical link that converts a basic research discovery to a drug candidate ready for in-licensing and clinical testing by a commercial organization.
Like their academic and commercial cousins, BIRDIs face a barren early drug development landscape. For many BIRDIs, the challenges are compounded by funding restrictions. Universities benefit from tuition and alumni contributions that department chairs or the office of technology licensing can apply to assist drug development projects. While some independent R&D institutions were founded by substantial gifts and may include doctoral and postdoctoral programs, they lack growing endowments fed by alumni to fuel their programs. Fledgling biotechs and commercial start-ups can access funding through angel investors, venture capital, and Small Business Innovative Research (SBIR) grants, but BIRDIs rarely receive such funding. Other government programs such as the Rapid Access to Interventional Development (RAID) award can provide preclinical contract services to nonprofit institutions, including universities and BIRDIs. These programs help fill a critical funding gap, but their pace can be significantly slower than standard commercial development timelines and may cost precious patent life.
Despite these challenges, BIRDIs can offer the best of both academic and commercial worlds as well as advantages unique to their individual structure.
Focus and flexibility: The size of BIRDIs may limit the scope of their activities, but it also encourages a more focused application of resources to a more narrowly defined set of therapeutic problems. This can lead to less breadth but more depth than a typical university. The relatively smaller size of most BIRDIs, relative to universities and pharmaceutical companies, also permits a more flexible and rapid response to technological hurdles. The organizational complexity of many universities and pharmaceutical companies can confound communications and delay decisions. For smaller biotechs, obligations to shareholders or reliance on a core technology may limit options to change course when setbacks occur. Independent institutions may have a more diversified portfolio than most biotechs and can reach and execute decisions more rapidly than larger academic and commercial organizations.
Business discipline: Without an endowment or private investment, BIRDIs must exercise business discipline and apply resources wisely. Their hybrid structure can be useful in a variety of collaborations and funding opportunities. Many BIRDIs are proactively forging new models for drug discovery and translation in partnership with foundations, industry, and state legislatures. With a greater emphasis on R&D than education, BIRDIs interface well with commercial partners focused on deliverables. On the other hand, sharing a nonprofit structure can also facilitate collaboration with foundations and academic institutions.
Expertise and teamwork: Many academic research centers excel at target identification and screening, but usually lack the broad expertise and incentives to optimize hits to clinic-ready drug candidates. The clinical, regulatory, and marketing perspectives that bring a compound from concept to drug are rarely found in an individual principal investigator or academic lab. To overcome this, many BIRDIs take a collaborative approach to drug development. While universities award tenure based on individual productivity metrics such as publications and citations, BIRDIs applaud collaborative drug development and generally do not grant tenure. The result is teams with the range of expertise found in commercial settings.
These advantages can help BIRDIs find funding despite a flat NIH budget and changes in venture capital. As hybrids, BIRDIs are often well structured to meet the growing emphasis on translational R&D in public and private funding sources. Experience with NIH applications coupled with infrastructure and personnel often missing in the average university (e.g., medicinal chemists, GLP facilities) have enabled several organizations to build large programs with NIH Roadmap funding. Their non-profit status is a natural fit with foundations and other venture philanthropies.
On the other hand, the business discipline at many BIRDIs is a good cultural match with pharmaceutical companies seeking to supplement their drug pipeline with a partner who understands metrics and deliverables.
BIRDIs are important sources of research and of new drug candidates. Since they share characteristics with academic and commercial organizations, overlapping the interests of each and spanning the gap between them, BIRDIs provide a critical partnership link in the drug development continuum.
About the Author
Edward Spack directs PharmaSTART, a consortium for preclinical development with SRI; Stanford; UC, Berkeley; UC San Diego; and UC San Francisco. He participates on advisory boards for several foundations and NIH translational development initiatives.
This article was published in Drug Discovery & Development magazine: Vol. 11, No. 10, October, 2008, pp. 38-40.
Filed Under: Drug Discovery