Moderna’s suit against Pfizer and partner BioNtech over alleged COVID-vaccine-related patent infringement — and the targets’ countersuit — might suggest an abrupt return to business as usual after an unprecedented period of cooperation among life sciences companies during the height of the pandemic.
The landscape has certainly shifted since the early days of COVID, when the prospect of multibillion-dollar state procurement contracts prompted a widespread laying down of arms. Intellectual property has reasserted itself as a key competitive weapon.
But it’s too early to dismiss the remarkable level of joint endeavour over COVID vaccines as a flash in the pan, and in numerous ways the pandemic has reshaped the life sciences industry in a more collaborative form. Facilitated — and often imposed — by governments and regulators, collaboration is increasing in areas including supply chains, in research and development, in the use of patient data, as well as in efforts to cut carbon emissions.
Supply Chains
The pandemic exposed long-standing weaknesses in life sciences supply chains. Existing problems such as very limited supply-chain transparency were exacerbated by ingredient shortages amid lockdowns in China and India and a surge in demand. Aside from COVID antivirals, new drug development ground to a halt and distribution problems abounded.
Post-pandemic, pushed by regulators, many life sciences companies have significantly diversified their supply chains by sourcing domestically, particularly in the U.S., or from new geographies. Visibility has improved, as has planning for the unexpected, including through real-time tracking.
Industry efforts are also underway to improve supply-chain transparency. The Pharmaceutical Supply Chain Initiative (PSCI) unites about 75 pharmaceutical and healthcare companies looking to do this.
European life sciences companies may soon have new obligations to share information about stock levels, potential shortages and product withdrawals under the pending Pharmaceutical Strategy for Europe.
Regulatory Push
This flagship element of the EU’s planned European Health Union is an example of how regulators are, in many respects, encouraging, if not demanding, collaboration.
The European Commission wants all EU nations to have access to reasonably priced drugs and to ensure the industry develops potentially less lucrative but urgently needed products, such as in the area of anti-microbial resistance, all while building supply-chain resilience. Its strategy also seeks to promote generics while giving patent incentives to companies which make their products available to poorer as well as richer EU nations.
Another EU initiative, the European Health Data Space, will act as a data repository that pharma companies can access. At the same time, they face obligations to share their own medical research data.
R&D
Buoyed by the rapid development of COVID vaccines, authorities in multiple jurisdictions, including the UK through its Life Sciences Vision, want to break down silos between the industry, academia, regulators and health services.
There’s also an obvious need to balance this with competitive positioning, the often uncertain returns on investment from drug development, and the faster development cycles now expected provide incentives to collaborate.
Information-sharing among private companies increased dramatically during the pandemic. Since then, life sciences collaborations and scientific partnerships in drug development have increased, says Deloitte, particularly in Europe. These include alliances between biopharma companies and MedTech manufacturers and tie-ups between life sciences companies and external providers of research facilities, including robotic cloud labs.
Another source of collaboration is between the insurance industry and data and analytics companies. The pandemic ushered in a sea change in the use of patient data, which dovetailed with an existing move toward so-called real-world evidence (RWE), culled from sources such as patients’ electronic health records and wearable devices. Advances in analytics are allowing RWE to be marshalled better than ever for drug development, regulatory approvals and post-marketing requirements, provided the necessary long-term partnerships with data specialists are in place, McKinsey recently noted.
Climate Change
Climate change is another arena where collaboration is key. Initiatives include the Energize renewable-energy access program and the Science Based Targets Initiative to limit global warming. The life science industry’s commitments are premised on sustainability as a supply chain advantage.
Of course, profit will remain companies’ main raison d’être. Collaboration has its limits, and the current patent disputes playing out among Big Pharma demonstrate that. It’s also fair to say that not all regulatory initiatives sit comfortably with the life sciences industry. The projected European Health Data Space, for example, has raised worries about the IP rights of data holders and the burdensome nature of data-sharing obligations.
Similarly, critics of the EU’s Pharmaceutical Strategy argue that it will make Europe less competitive by diluting IP protections, thereby giving the U.S. and China an advantage. (Pharma companies in the U.S. have their own worries, notably Biden’s Inflation Reduction Act pricing reforms).
What’s clear, though, is that changes in operating models, supply chain revamps and regulation impact the life sciences industry’s risk profile.
The vast expansion of its ecosystem has created new liability flashpoints, and the recent acceleration in drug development timelines raises the risks of litigation.
In addition, larger and more diverse collaboration circles in the industry increase the prospect of legal disputes, a risk that law firm Baker & McKenzie recently warned of.
Meanwhile the inexorable rise of tech, including the harnessing of patient data and the growing popularity of remote labs, expands cyber exposure.
As this complex and evolving industry learns how to collaborate, collaboration with brokers and insurers is also vital. In this way we can ensure coverage meets changing needs, risk mitigation is as thorough as possible, and if issues do arise claims can be settled promptly and efficiently.