The fallacy of “protecting your turf”

I’ve been getting Indian CROs on CRAMbridge over the last couple of weeks and am amazed by the breadth and depth of scientific talent they have in-house. With the right amount of direction from upper management, this can be leveraged to make these guys truly innovative biotech companies.

But there’s one troubling thread that’s common among big CROs that can come in the way of them realizing their full potential: fear of breaking what they have going right now. Resistance can be found from the mundane to the more philosophical. This attitude is shrouded in legalese: company policies, IP, NDA etc. What it really comes down to is this: fear of disclosing anything that may reflect negatively on existing relationships, especially with big pharma and biotech. Even when they understood my point on transparency, no one wanted to be the person who took a decision out-of-the-box.

As anyone who has ever gone to a government office knows, this red-tape is harmful to creativity and growth. Apart from this, big CROs (especially Asian ones) face two unique challenges because of this attitude:

  • Contract research growth is not driven by big pharma/biotech. Drugmaking (especially discovery through pre-clinical trials) is increasingly done by start-ups and virtual companies who drive growth in CRO demand. Being over-protective with your current clients should not come at the cost of repelling the drivers of business growth. When I was looking for CRO at my previous drug discovery labs, I was looking for transparency and nimbleness. Get me the whole truth, and nothing but the truth. And get it to me fast.
  • The downside risk of putting all your eggs in the same basket. Any change of thinking at a large client can severely affect a CRO’s top line because of the importance of large individual accounts. For example, if a large biotech company gets mired in a completely unrelated quality scandal and takes a decision to move away from Asian CROs, the setback on its Asian partners could potentially be devastating.

My advice? Sunlight! Be transparent and compete on your strengths – which you have a lot of. Be upfront about what you can, and cannot execute. Share past projects that were successful, but also the ones where things did not go that well. And most importantly, move with the times! Drug design and development is getting democratized whether you like it or not. Do you want to ride the wave of growth or double down on business as usual?

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