Publication

Don't stop the runaway train: harness its energy to improve the odds of making a medical breakthrough

A version of this article was first published in Scrip magazine, April 2002.   You can order a full version of the article, including details of PA's six principles for successful growth – at no charge – by clicking on the ‘Request publication’ button

The life sciences industry needs its smaller partners. Small companies can do many things which larger ones can't. At their best, small companies are nimble; can make decisions quickly; have drive, energy and enthusiasm; can be maverick in a way that big companies can't. In short, they have the dynamics that encourage innovation.

Large pharmaceutical companies, in contrast, tend to be structured and controlled in a way that encourages 'small molecule' development and marketing that's aimed at big-market opportunities, but works against blue-sky innovation. They are burdened with a bureaucracy that tends to stifle innovation and drive away entrepreneurial types and good ideas. Some big companies are trying to avoid this by creating the impression of a small company environment. GlaxoSmithKline for example recently divided its discovery research amongst small, internally competitive, centers of excellence.

Many small companies develop drugs to early clinical trials, then partner with a big pharmaceutical company for the later stages of development. With deals and arrangements like these, large companies implicitly acknowledge the advantages that smaller companies have in bringing new ideas to fruition.

It's clear, then, that there are big opportunities for small life science companies. But if they are to seize these opportunities, investors, managers and employees alike have to recognize that they're working in a special environment - one characterized by excitement, high risks and high potential rewards. To pull off the trick, they need to find ways to work with, rather than against, this environment.