Introducing Seeds to Pharmaceutical Companies

When startups pitch their products or technologies, the business development departments of pharmaceutical companies, etc., serve as the point of contact. Here, we will focus on the pharmaceutical industry.

• Business Development Department
  • In the pharmaceutical industry, licensing operations are systematized, and most companies have dedicated departments and staff. This was originally a system adopted by global pharma, but domestic companies are now following suit.
  • Department names used to often be External Relations, Licensing, or Business Development, but recently, Open Innovation seems to be in vogue. Here, we will refer to them collectively as the Business Development Department.
  • Depending on the company, the department in charge may differ for early-phase and relatively late-stage items, but information is shared internally.
  • Some Japanese medical device manufacturers also have dedicated departments, but this is limited to major companies and they are not as well-staffed as those in pharmaceutical companies.
• How to Find Needs
  • There are two main ways: one is the relevant webpages of individual companies, and the other is the needs information pages published by public organizations, etc. The main public organizations that post the needs of pharmaceutical companies are as follows.
    • JPMA (Japan Pharmaceutical Manufacturers Association)
      • Research and Development Needs of Committee Member Companies
      • https://www.jpma.or.jp/information/research/RD_needs/index.html
    • JBA (Japan Bioindustry Association)
      • Information on Research/Development Collaboration Opportunities from Companies
      • https://www.jba.or.jp/activity/open_innov/jbamember_directory/alliance/
    • AMED (Japan Agency for Medical Research and Development)
      • Seeds/Needs Matching Promotion Page
      • https://www.amed.go.jp/program/list/11/01/seeds-needs_list.html
  • Individual Companies
    • Please refer to each company's Open Innovation pages, etc. Also, most pharmaceutical companies have a needs list (called a wish list), so you can also inquire with the business development representative.
    • There are also private company websites that compile the needs of pharmaceutical manufacturers, so use them as needed.
    • If you belong to academia, the industry-academia collaboration department will be the contact point for external relations. They often already have the wish lists of pharmaceutical companies, and sometimes publish them on the university's website. Let's make active use of this.
• Approach
  • Participate in networking events such as Bio Japan
    • The most efficient is Bio Japan.
      • https://jcd-expo.jp/jp/about.html
    • At that time, it is highly recommended to use the partnering system, although it is a paid service. By using this system, it becomes possible to set up meetings with many companies.
      • https://jcd-expo.jp/jp/partnering.html
  • Individual Approach
    • It is also possible to make inquiries through each company's website, etc.
• Basic Flow
  • After confirming the other party's needs, contact their business development department through events like Bio Japan or by email.
  • First, you provide non-confidential materials for them to review.
  • The business development department reviews the content of the seeds to see if they fit with the priority development areas. Seeds that do not fit are rejected on the spot. If they do fit, they will check for interest with relevant internal departments.
  • If the other party is interested, there will be some inquiries, and usually a meeting request.
  • After the meeting, if they want to know more details, they will propose concluding a non-disclosure agreement (NDA).
  • After concluding the NDA and following several reviews, if there is a desire to partner, the pharmaceutical company will conduct due diligence (DD).
  • If the DD by the pharmaceutical company's internal and external DD specialist teams shows no particular problems, it will lead to a formal contract.
• Common Questions/Misconceptions
  • "Isn't it better to pitch directly to the R&D department?"
    • Not highly recommended.
    • The areas targeted for licensing are closely linked to the company's management strategy. The business development department, which is the point of contact, is well-versed in this, but the R&D department is not necessarily so. Depending on the person, they might be involved in research that is outside the priority areas. In the first place, the business development people attending networking events like Bio Japan are approved by the company to participate, so introducing products and technologies through them is the proper approach.
    • "I'll talk about the details after signing an NDA."
    • In the case of pharmaceutical companies, they cull heavily at the non-confidential level (some companies reject about 70%). If you take the leisurely approach of "I'll talk about specifics after signing an NDA," you won't get to the next step. Of course, there is no need to include top-secret matters, but the materials must be thoroughly prepared.
  • "For global pharma, isn't it better to introduce it to the overseas headquarters?"
    • As a rule, the business development representative at the Japanese subsidiary will be the point of contact.
    • Most global pharma companies already have a Japanese subsidiary and Japanese business development staff.
    • In large companies, business development staff have assigned territories, and in most cases, seeds coming from Japan will be handled by the Japan business development team.
    • Similarly, seeds originating from Europe are handled by the European business development staff, and seeds from the US are handled by the US business development staff.
    • In any case, seed information is shared among the company's business development staff, so it's safe to say there is almost no difference depending on the point of contact.
  • "I was rejected once, but can I propose it again at another time?"
  • It's case-by-case, but if you were once clearly rejected as "not interested," the probability is low.
  • The response from a pharmaceutical company after providing non-confidential materials largely falls into the following three categories.
    • 1) We are interested, please explain it to us once.
    • 2) We are interested, but please contact us again after you've made more progress.
    • 3) We are not interested and will not conduct further evaluation.
  • 1 is literally a good response, and you will be given an opportunity for about an hour-long product/technology introduction, either online or in person.
  • In case 2, it matches their strategic area and they are interested, but due to reasons like insufficient POC, they want to evaluate it after more positive data is available.
  • 3 is a case where it is rejected because it doesn't match the strategic area in the first place, or the seeds are judged to be weak.
  • Therefore, if the response is 3, there is almost no chance. If it is 2, you can consider it possible to try again if you get good data.
  • When you start contacting companies, it is recommended to take individual notes of the companies' responses as described above, chronologically and for each company.
  • Also, be sure to take notes on feedback from companies. Even if it's negative feedback, scrutinize it and constantly improve your materials and activities.
  • This series of tasks is equally effective when contacting VCs for fundraising purposes.

©K.Kamitani