I’m a huge fan of R&D collaborations between pharma and academia, so I should be thrilled by Sanofi’s latest tie-up with seven top-tier centers – so why do I have mixed feelings?

On first glance, there’s a lot to like: Sanofi has committed $2.4M per year to seven top centers, including Johns Hopkins, Brigham and Women’s Hospital, and Columbia, to fund about 20-25 seed projects annually, with no strings attached and a wide-open scope. Who knows what will emerge – but it won’t take much for this to look like a pretty good investment for Sanofi.

Still, I worry that throwing unrestricted funds at academia’s best-known research centers is a symptom of low creativity in pharma R&D – a safe, straight-down-the-middle bet, designed to neither awe nor disappoint, and also, like hiring McKinsey as your consulting firm, guaranteed not to ruffle any feathers. Isn’t there a better way?

[Disclosures: I have a position at Brigham and Women’s (though I’m not involved with the Sanofi alliance), and I previously helped design AstraZeneca’s “open innovation” website.]

Not that “A-list” centers aren’t worthy collaborators, mind you. By my count, in the first three months of 2015, over a third of the 85 research articles in the leading journal Cell were penned by senior authors from just five institutions: Harvard, Rockefeller, Stanford, UCSF, and Yale. If a pharma company wants to fund folks with proven records of generating data, it’s pretty easy to figure out who comes out on top.

And some leading centers have built differentiated capabilities, resources, and know-how in particular scientific and clinical areas – which helps explain the attraction of disease-specific tie-ups like GSK/Crick and Novartis/Dana-Farber, for example.

But despite the apparent logic of partnering with academia’s “usual suspects”, pharma is missing many breakthrough research opportunities by ignoring the rest of the pack, for a few reasons:

1. Scientific talent is diffuse: Due to the current postdoc glut, there’s a surplus of excellent biomedical researchers in academia – which means strong faculty are joining many institutions that aren’t always on pharma’s speed-dial list. In fact, the 20 top-funded centers by NIH in 2015 includes not just high-profile players on the East and West Coasts, but also University of Michigan (#6), Washington University in St. Louis (#8), University of Wisconsin-Madison (#18), and Vanderbilt (#19) – none of which, I’d reckon, gets its fair share of love from pharma R&D groups compared with centers in California, Massachusetts and New York.

2. The “capabilities gap” has narrowed between top-tier centers and the rest: Powerful translational research tools like whole-genome sequencing, high-throughput screening, inducible transgenics, ultra-sensitive mass spec, and even CRISPR-Cas9 gene editing used to be the exclusive playthings of well-funded labs at elite institutions – but today, investigators can access (and afford) them in Hawaii just as well as at Harvard.

3. Pharma has an unrealized “contrarian opportunity” in R&D partnerships: Fred Wilson recently noted that if a room full of venture capitalists spurns a particular area (in his example, blockchain), “go there. It is going to be profitable.” The corollary, of course, is that you’re unlikely to gain any advantage by following the herd – like we see in pharma companies’ FOMO-driven rush to set up outposts in Cambridge, MA.

Giving unrestricted research grants to top-ranked centers isn’t a terrible idea per se, but to get a competitive edge, pharma needs to fish in less-crowded waters – for example, with “open innovation” programs that solicit partnership proposals irrespective of an investigator’s institution. (See here for a directory of these initiatives that my colleague Seth Robey and I recently compiled.) We’re in the early days, but anecdotal evidence (e.g., here and here) suggests these programs can successfully “crowdsource” novel ideas and data that never would have been uncovered otherwise.

One challenge is that venturing beyond the top-tier centers is harder than partnering with an academic “blue-chip” – it takes funds and effort to set up and publicize open innovation programs, they may not generate the same PR buzz as partnerships with Ivy League medical centers, and it’ll probably take a bit of effort to explain to senior execs why they’re valuable.

But we’re in a window in which an enterprising pharma R&D team could have an outsized impact on the pipeline by helping overlooked academics translate their insights into tangible clinical advances. Because although some companies have set up open innovation programs, there’s abysmally low awareness of them among investigators – which is why we built our directory in the first place, and also why there’s still a huge opportunity for pharma companies to get into the game.

Innovative R&D isn’t easy, and the odds of finding and funding academic research projects that will lead to real breakthroughs are long – but dollar for dollar, there’s likely far more to gain for pharma companies from broad-based collaboration initiatives than from partnering with the same academic institutions as everyone else.

Source: Forbes