Strategic Alliance Magazine - Q4 2013 - Non-ASAP-Member Edition by ASAP

There Are Now More Ways to Earn CA-AM and CSAP Certification Points Than Ever! ASAP members have more avenues to secure and register qualification points toward CA-AM renewal or CSAP exam eligibility. Unveiled on July 1, our new point system provides 15 categories for earning points spread across four larger groupings: n Presentations (ASAP conferences, chapter events, and webinars as well as approved

ASAP and non-ASAP courses) n Writing (Member Resource Library, Strategic Alliance Magazine, Best Practices Bulletin, or other approved publication) n Attendance/Participation (ASAP conferences, chapter events, and webinars as well as approved ASAP courses and pre-approved continuing education programs) n Service to ASAP (chapter leadership, Board/special task force/committee membership) To review the new certification point categories in greater detail, go to the Renewals & Eligibility page under the Career Building section of www.strategic-alliances.org. Renewing your certification is more than just keeping up a title; it ensures continued success in your practice and the advancement of your career. For questions about submitting points under the new system, please contact ASAPâ&#x20AC;&#x2122;s Certification Coordinator, Jennifer Silver, at 781-562-1630 ext. 205 or jsilver@strategic-alliances.org.

ALLIANCE MANAGEMENT CERTIFICATION

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For most companies, the question is no longer whether to ally, but how to do it right. The answer starts with the Association of Strategic Alliance Professionals.

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Apply state-of-the-art tools, practices, and processes for alliance planning and execution n Engage with a community of highly accomplished alliance management professionals who not only share your challenges but also have the blueprints to overcome them n Design and build their company’s alliance management function n Promote their organization as “partner of choice” within their industry n Inﬂuence all pertinent stakeholders to contribute to making alliances ﬂourish n Network with professionals from a variety of industries to find their next job, partner, or employee n Obtain the requisite training in the discipline’s hard and soft skills n Illustrate to C-level executives and other stakeholders the value generated by an alliance portfolio and the Alliance Management practice n Keep current with the latest high-level collaboration strategies n

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“…For anyone interested in learning ‘how to do alliances right,’ this is the organization to belong to!” – Joost Allard, Allinnova

Become an ASAP Member Today! ASAP offers two membership types, Individual and Corporate. To become an ASAP Individual Member today visit www.strategic-alliances.org/individuals. To become a Corporate Member contact ASAP’s director of membership services Lori Gold at+1-781-562-1630 ext. 203 or lgold@strategic-alliances.org. 960 Turnpike St, Canton, MA 02021 USA | Tel: +1-781-562-1630 | strategic-alliances.org | info@strategic-alliances.org

OUR HEART IS ALWAYS IN OUR WORK BECAUSE OUR PATIENTS ARE ALWAYS ON OUR MIND. The remarkable impact we make on people’s lives comes from a relentless focus on what each patient needs and how to deliver it. We are a biopharmaceutical company that combines science, passion, and expertise to bring new solutions to health and healthcare. We measure our success by the impact we make on patients’ lives. abbvie.com

up front Raising the Bar–Once Again As the C-Suite Starts to Buy into Alliances, a New but Familiar ASAP CEO Will Help “Close the Deal” in 2014 By Russ Buchanan

WHEN AUTUMN TURNS to winter and we suddenly realize the New Year is fast upon us, it is usually a good time to take a step back, evaluate the big picture, and see where we are heading. As is the case with most years, 2014 appears poised to bring plenty of change, and for ASAP and the profession it is filled with promise. We have the enviable task of maintaining an upward trajectory. Our efforts in the early part of this decade to create a dialogue with the C-Suite have paid off. Senior leadership understands how important business collaboration is today in increasing revenue, spurring innovation, and successfully completing the organization’s most important objectives. Of course, with great opportunity come great challenges. Great expectations accompany the gaze of a company’s top executives (see “The Spotlight Intensifies” on page 28), and although alliances are recognized for their strategic value, there is still work to do in demonstrating the role alliance management professionals play in attaining it. We as professionals need to constantly explore our partner base and assess where our allies can add revenue, fill product gaps, and help expand into new markets. We have to keep an eye on trends in our own industry so that we can search for new partners that can help achieve our goals in this ever-shifting business landscape. All the while, we must proactively walk C-Suite executives through how each current and prospective alliance fits into the overall context of the company’s alliance portfolio and broader company Quarter 4, 2013

strategy. In short, to realize the possibilities that await us in 2014, we have to leverage the intimate knowledge of our partners to bring unique and insightful business thinking. Similarly, as we in alliance management continue to push ourselves closer to the center of the business world’s radar, ASAP will have a new but familiar leader, one who has previously led an alliance management practice and ASAP itself to success. Michael Leonetti, the man who pioneered and built out Boehringer Ingelheim’s alliance management practice, took the reins as ASAP’s CEO in November. Leonetti was at the forefront in establishing the dialogue with senior leadership last decade (see “A Place in the Conversation,” Strategic Alliance Magazine, Q4 2012), and Boehringer Ingelheim was one of the business world’s first alliance management success stories—the company added $3 billion–plus in annual sales of drugs associated with its Pfizer, Abbott, Eli Lilly and Company, and Astellas alliances under Leonetti’s watch. Meanwhile, he is also the perfect man to continue to grow the ASAP community because he has already done it once. Leonetti raised

the bar for the association and the profession in his tenure as ASAP board chairman from 2006 to 2009. In that time, ASAP founded several significant initiatives, including certification and the ASAP BioPharma Conference. We saw a large increase in Individual, Corporate, and Global Membership, expanded our member base in several continents, and added five new chapters. In addition, the organization itself became a more professional operation, hiring a full-time staff and acquiring new offices. ASAP and the alliance management profession have taken an important leap once before under Leonetti’s direction. Now, collectively, we’re in a great position to make the next big jump this coming year. We welcome Mike on board as he takes the helm at ASAP, and as always, we invite your thoughts and feedback. n

Russ Buchanan is ASAP’s board chairman. He is also vice president of worldwide alliances at Xerox. 5

Quarter 4, 2013

The magazine of the Association of Strategic Alliance Professionals AN ASAP MEDIA PUBLICATION www.ASAPmedia.org www.strategic-alliances.org EDITORIAL TEAM Michael Leonetti, Executive Publisher +1-781-562-1630 ext. 201 mleonetti@strategic-alliances.org John W. DeWitt, Publisher +1-978-544-1866 jdewitt@ASAPmedia.org Jon Lavietes, Editorial Director +1-415-572-4408 jlavietes@ASAPmedia.org Michael Burke, Editor-in-Chief +1-413-665-4958 mburke@ASAPmedia.org Greg Caulton, Creative Director +1-413-461-7096 gcaulton@ASAPmedia.org Gary Lee, Online Media Manager +1-978-544-1866 glee@ASAPmedia.org Rik Rolski, Sponsorship Sales Director +1-978-544-1866 rrolski@ASAPmedia.org Michelle Duga, Sponsorship Coordinator +1-978-544-1866 mduga@ASAPmedia.org Emily Bayard, Image Researcher +1-413-461-7096 ebayard@ASAPmedia.org Mike Ruocco, Graphic Designer +1-978-544-1866 mruocco@ASAPmedia.org ASAP STAFF Michael Leonetti, President and CEO +1-781-562-1630 ext. 201 mleonetti@strategic-alliances.org Lori Gold, Director of Membership Services +1-781-562-1630 ext. 203 lgold@strategic-alliances.org Michele Shannon, CA-AM, CMP Senior Meeting & Event Manager +1-781-562-1630 ext. 204 mshannon@strategic-alliances.org Kimberly T. Miller, Marketing Manager +1-781-562-1630 ext. 208 kmiller@strategic-alliances.org Brendan Ward, Administrative Support +1-781-562-1630 ext. 200 bward@strategic-alliances.org Diane Lemkin, Accounting Manager +1-781-562-1630 ext. 206 dianel@strategic-alliances.org Jennifer Silver, Certification Coordinator +1-781-562-1630 ext. 205 jsilver@strategic-alliances.org Michele Yudysky, Membership Coordinator +1-781-562-1630 ext. 209 myudysky@strategic-alliances.org © Copyright 2013 Association of Strategic Alliance Professionals. All Rights Reserved.

in this issue

n COVER STORY

Connecting the Dots That Can’t Yet Be Seen

Alliance Managers Will Have to Reimagine Their Value Chains to Achieve the Next Breakthrough Innovation | By Jon Lavietes

The pieces for the solution to your customer’s most vexing challenge are scattered about. Some are likely in your existing partner ecosystem. Some might be elsewhere, and others are as yet unforeseen. With a heavy dose of creativity, forward thinking, and business acumen, the alliance manager’s knowledge of the organization’s partner network puts him or her in a great position to conceive of the next great disrupter.

n SPECIAL FOCUS: BIOPHARMA

Comply or Die (or Just Pay Millions of Dollars in Fines)

The Alliance Manager Can Play a Major Role in Preventing Costly Instances of Marketing Noncompliance By Jon Lavietes

Ensuring marketing compliance in commercial alliances is becoming more difficult and expensive with each passing year. The already-confusing guidelines are getting more complex, and regulatory authorities are enforcing them with more vigor and levying hefty fines more frequently than ever. The alliance manager can help the medical, marketing, and compliance teams stay on the same page to avoid improprieties.

Strategic Alliance Magazine

n SPECIAL FOCUS: BIOPHARMA

The Spotlight Intensifies

Opportunity for Biopharma Alliance Professionals Grows as Companies’ Strategic Focus Sharpens—and the Executive Suite Looks to Alliance Management to Deliver | By Jan Twombly, CSAP, and Jeff Shuman, CSAP, Ph.D.

An update on the 2012 Practice of Alliance Management in the Biopharmaceutical Industry Study conducted by The Rhythm of Business finds an intensified focus on alliance management performance in the industry as a whole. The study results show an expansion of alliance management activities in smaller companies, and opportunities for alliance professionals in new corners within industry giants—and with new types of partners.

n SPECIAL FOCUS: BIOPHARMA

Adventures in Biopharma Funding

Awash in Biotech Start-ups, Venture Capital Investments, and Successful IPOs, Biopharma Is Evolving Before Our Eyes. And What Will Google’s Entry Mean for the Industry—and Immortality? | By Michael Burke

Venture capital funding of biotech start-ups, a wide-open IPO window, and Google’s momentous entry into the industry all add up to a changing landscape for biopharma. But what does it all mean, and where will alliance management fit in?

n GOVERNANCE DESIGN

Plan to Succeed

How a Business Plan Drives Continuous Improvement in Alliance Management | By Brent H. Harvey, CA-AM, David S. Thompson, CA-AM, and Steven E. Twait, CSAP

A solid business planning process examines the strategic, operational, and financial aspects of your business, the results your alliance management group achieves, and how to continue to review, revise, and improve your methods. Sponsored by Eli Lilly & Co.

Regular Features: 5 n UP FRONT As the C-Suite Starts to Buy into Alliances, a New but Familiar ASAP CEO Will Help “Close the Deal” in 2014 11 n COLLABORATIVE BUZZ Alliance News Briefs | People in the News ASAP & ASAP Partner Calendar of Events | ASAP Chapter Updates Quarter 4, 2013

15 n ASAP MEMBER SPOTLIGHT A Trust That Isn’t Manufactured CMO One 2 One’s Utilization of Alliance Management Principles Has Helped Build Long-Term Relationships with Clients By Jon Lavietes 7

Quarter 4, 2013

The magazine of the Association of Strategic Alliance Professionals ASAP EXECUTIVE COMMITTEE Russ Buchanan, CSAP ASAP Chairman of the Board Vice President, Worldwide Alliances, Xerox Corp. Harry Atkins, CSAP ASAP Treasurer Senior Director, Corporate Development, Dr. Reddy’s Laboratories, Inc. Brian Handley, CA-AM ASAP Secretary Business Development, Emerson Corp. Christine Carberry, CSAP Chairman, ASAP Knowledge Base & Research Committee Vice President, Program & Alliance Management, EnVivo Pharmaceuticals Snehal Desai, CA-AM Chairman, ASAP Marketing Committee Global Marketing Director, The Dow Chemical Company Grif Morrel, CSAP Chairman, ASAP Chapter Presidents’ Council Senior Manager, Sales Business Development and Operations, Cisco Systems, Inc. Alistair Pim, CSAP Chairman, ASAP Professional Development Committee Vice President, Global Strategic Alliances, Schneider Electric Jan Twombly, CSAP Chairman, ASAP Program Committee President, The Rhythm of Business, Inc.

Strategic Alliance Magazine is published quarterly. Publisher is The Association of Strategic Alliance Professionals, 960 Turnpike Street, Canton, MA 02021, +1-781-562-1630. Subscriptions are $99 for one year, $189 for two years. Canadian subscriptions are $149 per year. All other international subscriptions are $199 (using air mail). Subscription inquiries: +1-781-562-1630. Periodicals postage is paid in Chicopee, MA, and additional mailing offices. Postmaster: Send address changes to STRATEGIC ALLIANCE MAGAZINE, 960 Turnpike Street, Canton, MA 02021. Copyright 2013, The Association of Strategic Alliance Professionals. No part of this publication may be reproduced, stored in any retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. For reprints, please contact The Association of Strategic Alliance Professionals at +1-781-562-1630.

in this issue 46

n YOUR CAREER

A Ray of Opportunity

It’s Not a Role for Beginners, but for Seasoned, Highly Networked Alliance Pros, the Sun Is Shining By Michael Burke

It is hard to break into the alliance management field without expertise specific to your industry, and oftentimes your company, too. But for those whose feet are already wet, opportunities could be arising soon. Here are some of the skills professional recruiters and longtime alliance management veterans are looking for in candidates.

n ALLIANCE CHAMPION

Leading from the Center

Andy Eibling Brings Years of Big Pharma Experience to Bear on Formalizing the Alliance Management Practice at CRO Covance | By Michael Burke

This issue’s Alliance Champion, Andy Eibling, brought his years of experience at alliance management and Big Pharma pioneer Eli Lilly and Company to his current role at CRO Covance, where he and his colleagues are taking the discipline to the next level.

n THE CLOSE

A New Perspective

Our Association and Alliance Initiatives Are Doing More Than Simply Helping Our Careers and Company Alliances | By Jack Pearson, CSAP

Alliance management professionals are all about helping companies achieve their most important strategic alliance objectives. A recent stint as acting CEO has helped ASAP’s vice chairman see the link between the things members accomplish with ASAP and the impact it makes on the greater business landscape. Strategic Alliance Magazine

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Collaborative Buzz Xerox Helps State Health Exchanges Get Up and Running By Michael Burke

ASAP GLOBAL MEMBER XEROX has been helping states implement the Affordable Care Act by partnering with them to make their health insurance exchanges operational. So far, the company has worked with Kentucky and Nevada to get their exchanges up and running, and offers packaged solutions for other states looking to provide better access to health care. Xerox partnered with Kentucky governor Steve Beshear and his administration to operate a contact center to support Kentucky’s Health Benefit Exchange, known as kynect. The kynect contact center opened in Lexington on August 15, with more than 60 professional customer care representatives using state-of-the-art technology to answer questions about Kentucky’s new health insurance marketplace, assist citizens in navigating the online application process, and, for those without Internet access, even to help complete and file applications. Representatives are available via phone, live online chat, and email. The contact center was expected to have more than 100 representatives on staff in time for the start of open enrollment on Oct. 1.

be built from scratch, including a Web site, call center, back office, Xerox data centers in Texas and Pennsylvania, and links to the federal data services hub that connects to federal agencies. As of Oct. 1, the Silver State Health Insurance Exchange is helping Nevada residents to view insurance plans from various providers, compare rates, calculate premiums, and purchase policies— and get help via a live chat function or over the phone if they encounter any difficulties in the process.

Close collaboration was required between Xerox and the Commonwealth of Kentucky to complete all the technical preparations to ensure that state residents receive efficient and speedy service from the most appropriate information source by ensuring the optimal connection with the appropriate government agencies.

Building these state sites has been an unprecedented effort for the states themselves and for Xerox, with many different pieces and considerations, from structural components of the systems involved to changing policy interpretations and rulings as the exchanges prepared to go live—all on a tight timeline and in anticipation of a rush of participation in the first days and weeks after implementation. As Kevin Walsh, senior vice president for eligibility and exchange services at Xerox, noted, “It’s the type of project that should normally take between three and five years.”

Meanwhile, the State of Nevada built its own health exchange with the help of Xerox, whose system expertise it tapped through a five-year, $71 million deal. The Nevada exchange features a number of moving parts, all of which had to

The nationwide build-out of health care insurance exchanges mandated by the Affordable Care Act represents one of the largest information technology initiatives in U.S. history. The scope of the projects, and the complexity of the

Quarter 4, 2013

law itself, presents numerous hurdles for state officials and the contractors hired to construct and run the exchanges. “Everyone is wearing six hats, and no one is getting a lot of sleep right now,” said John Hager, executive director of the Silver State Health Insurance Exchange. Nevada employed face-to-face meetings, public comment sessions, online information programs, and other means to ensure that all parties with a stake in the exchange were updated on its progress and informed about what to expect. “You can’t communicate enough,” said Hager. “We brought everyone to the table to make the policy decisions on how the exchange should be created and what we are doing.”

ASAP News Registration Now Open for ASAP Global Summit Registration for the 2014 ASAP Global Alliance Summit is now open. From March 9 to 13, 2014, the desert will bloom as hundreds of alliance management professionals and luminaries from all over the world descend on the Phoenix area to convene at the Talking Stick Resort in Scottsdale, Ariz., for this annual must-attend event, by far the world’s largest annual gathering of 11

Collaborative Buzz leading companies and practitioners in alliance management. As always, the 2014 Summit will feature top-notch programming covering strategy and execution, the latest theory and best practice, state-of-the-art alliance management tools, and every phase of the alliance life cycle; world-class networking with some of the profession’s outstanding thought leaders, as well as your current and prospective partners; and professional development opportunities, including certification workshops and hands-on skill-building sessions. In addition, new features are being designed and added day by day to ensure that even alliance management veterans will gain fresh insights. Alliances and collaborations are everywhere, and those who are “walking the talk” will be carrying the torch and holding the talking stick in March. To register for the Summit or for more information, go to www.strategic-alliances.org/summit.

ASAP and ASAP Partner Events 2013 ASAP BioPharma Conference

Wednesday, November 20 – Friday, November 22, 2013, Hyatt Regency Boston, One Avenue De Lafayette, Boston, Mass., USA (go to www.strategic-alliances.org/biopharma for more information and to register)

DC/MidAtlantic Chapter Event: “‘They Said WHAT??’: How to (Re)Build Trust and Respect with Alliance Partners” Wednesday, November 20, 2013, 7:30– 9:30 a.m., Microsoft, 5404 Wisconsin Ave., Conference Room #7023, Chevy Chase, Md., USA (go to www.strategic12

alliances.org for more information and to register)

BeNeLux Chapter Event: “Eco System: Multi Party Alliance vs. Single Alliance Structures” Tuesday, December 10, 2013, 4:00–7:30 p.m., Royal Philips Electronics, Breitner Tower, Amstelplein 2, 1096 BC Amsterdam, The Netherlands (go to www. strategic-alliances.org for more information and to register)

2014 ASAP Global Alliance Summit Sunday, March 9 – Thursday, March 13, 2014, Talking Stick Resort, 9800 E. Indian Bend Rd., Scottsdale, Ariz., USA (check www.strategic-alliances.org/summit for more information and to register)

Alliance News So It Doesn’t Stink—But Is It See-Through? Lululemon and Noble Biomaterials Stretch Fabric Alliance Lululemon Athletica Inc. has announced a strategic global alliance for the material X-STATIC with Noble Biomaterials. The partnership gives Lululemon exclusivity to use Noble’s X-STATIC antimicrobial technology in its performance apparel, which the company said will “secure our leadership position in ‘anti-stink’ athletic apparel.” Noble has been a long-standing partner of Lululemon, providing its X-STATIC technology for the company’s Silverescent fabric since 2005. Made with 99.9 percent pure metallic silver, X-STATIC is designed to provide permanent odor protection by naturally inhibiting the growth of bacteria on the surface of fabrics. The silver fiber is woven directly into the garment and will not wash out over time through laundering. Thus if any clouds appear on the horizon in this alliance, it’s safe to say they’ll have a silver lining.

Clouds United: Salesforce and Workday Partnership Sails Aloft

ASAP Corporate Member Salesforce. com and Workday recently announced plans to integrate the entire Salesforce and Workday product lines to enable their customers’ mutual success. Salesforce.com plans to standardize on Workday’s applications, and Workday plans to standardize on Salesforce.com’s applications and platform, integrating Salesforce with Workday Human Capital Management (HCM), Workday Financial Management, and Workday Big Data Analytics. Additionally, Salesforce. com intends to integrate Workday into its applications and platform, including Salesforce Chatter for collaboration throughout the enterprise. “It’s a great day for the cloud!” exulted Marc Benioff, chairman and CEO of Salesforce. “Aneel [Bhusri, chairman and co-CEO of Workday] and I both agree that Salesforce.com and Workday need to unite our clouds.”

BMG and Primary Wave Hold Hands, Seek Music Nirvana

German media company Bertelsmann SE & Co. KGaA announced in September that its music rights management subsidiary BMG had entered a joint venture with Primary Wave Music that will focus on the new music of established musicians, according to the Wall Street Journal, New York Times, and other sources. As part of the agreement, U.S. music publishing and marketing company Primary Wave will be responsible for marketing newly released titles, while BMG buys a substantial stake in Primary Wave’s music publishing rights. Bertelsmann put the total value of the partnership at around $150 million but released no other financial details. The purchase of some of Primary Wave’s music publishing rights gives BMG a portion of the rights to such Strategic Alliance Magazine

classic hits as “September” by Earth, Wind & Fire, and the Beatles’ “I Want to Hold Your Hand,” as well as songs by Hall & Oates, Nirvana, and Aero smith. BMG announced in June that it would begin representing the publishing interests of rock gods such as the Rolling Stones’ Mick Jagger and Keith Richards. Bertelsmann established BMG in partnership with financial investor Kohlberg Kravis Roberts & Co. in 2008, having sold most of its existing music assets to Sony and Universal. Earlier this year, the German company bought out KKR’s stake. Primary Wave, based in New York, started in 2006 when the company paid $50 million for half the publishing rights of Kurt Cobain, the late lead singer of Nirvana. The company has expanded into artist management, branding, and television. Among its most successful acts is the singer CeeLo Green. Primary Wave will retain some publishing assets, including the Def Leppard catalog, along with its management company, according to a report in Billboard.

Renault-Nissan and Daimler Alliance Rolls On

The chief executives of the RenaultNissan Alliance and Daimler AG report that their companies’ partnership is advancing quickly, and the scope of the collaboration is increasingly global. The French-Japanese-German partnership began in April 2010, with three “pillar projects” primarily focused on Europe. Since then, the portfolio has increased to 10 significant projects, including major initiatives from North America to Japan. In addition, relevant business units are working together in best-practice sharing and other forms of cooperation. “While our initial collaboration focused strongly on European projects, we are now focusing on synergies in all key markets,” Renault-Nissan chairman and CEO Carlos Ghosn said at an annual Quarter 4, 2013

media briefing on the partnership in mid-September. “The largest economies of scale are always global.” “We will continue to seek out new projects together that make sense for all partners and, most importantly, our customers,” Daimler CEO and head of Mercedes-Benz Dieter Zetsche said. The CEOs cited the joint production of Mercedes-Benz four-cylinder gasoline engines in Decherd, Tenn., as one example of how the partners profit from the cooperation. Just one and a half years after the groundbreaking in May 2012, production machinery is now being installed and the start of production is planned for mid-2014. The engines produced in Decherd will then be used in the Mercedes-Benz C-Class, which is produced at the Daimler plant in Tuscaloosa, Ala., and in new Infiniti products. Joint development work is also proceeding on schedule for a new family of shared three- and four-cylinder gasoline engines with turbocharging and direct fuel injection. Another outgrowth of the alliance is the new Infiniti Q50, which was presented in Geneva in the spring and will be available this fall. It is the first Infiniti automobile to have a power train comprising a diesel engine and automatic transmission from the cooperation with Daimler. The first vehicles resulting from the collaboration, including the Mercedes-Benz Citan van, are already on the road.

Bayer Takes a Broad View

ASAP Corporate Member Bayer HealthCare, a subgroup of Bayer AG, has entered into a strategic alliance with the Cambridge, Mass.–based Broad Institute in the area of oncogenomics and drug discovery, according to PharmaBiz.com. The goal of this collaboration is to jointly discover and develop therapeutic agents that selectively target cancer genome alterations over a period of five years. (Oncogenomics is a promising field of oncology research that identifies and characterizes genes that are associated with cancer.)

The Broad Institute is a nonprofit biomedical research institute that brings together scientists from Harvard, MIT, and the Harvard-affiliated hospitals, and has expertise in genomics, cancer, chemical biology, and drug discovery. “We are excited to collaborate with such a prestigious research institute as the Broad Institute,” said Prof. Andreas Busch, head of global drug discovery and member of the executive committee of Bayer HealthCare. “The Broad

BMG announced that it would begin representing the publishing interests of rock gods such as Mick Jagger and Keith Richards. Institute’s scientists have created impressive systematic catalogs of mutational changes across different types of tumors, laying a foundation for the development of new cancer therapies and diagnostics. The alliance is another significant step underlining our engagement in the field of oncology and personalized medicine.”

Tighter Abs: AbbVie and Ablynx to Partner on Rheumatoid Arthritis

ASAP Global Member AbbVie and the Belgian company Ablynx announced that they have entered into a global license agreement to develop and commercialize the anti-IL-6R nanobody ALX-0061 to treat inflammatory diseases. ALX-0061 is Ablynx’s proprietary anti-IL-6R nanobody that successfully completed a Phase IIa study in February 2013 reporting strong efficacy and safety data in patients with moderately to severely active rheumatoid arthritis (RA) on a stable background of methotrexate. Speculation in some industry publications has this approach possibly succeeding AbbVie’s successful drug Humira one day as an RA treatment. Under the terms of the agreement, Ablynx will be responsible for completing Phase II clinical development in 13

Collaborative Buzz both RA and systemic lupus erythematosus (SLE). Upon the achievement of predefined success criteria, AbbVie will exercise its right to in-license ALX-0061 and be responsible for subsequent Phase III clinical development and commercialization. Ablynx will retain an option for copromotion rights in Belgium, the Netherlands, and Luxembourg. Ablynx will receive an up-front payment of $175 million, which will partly be used to fund the next phases of clinical development of ALX-0061. Upon achievement of certain development, regulatory, commercial, and sales-based milestones, Ablynx will be eligible to receive additional milestone payments totaling up to $665 million as well as double-digit tiered royalties on net sales upon commercialization.

Print It, Baby: Heavy Hitters Launch Mobile Print Alliance Canon, Samsung Electronics, ASAP Corporate Member HP, and ASAP Global Member Xerox have launched the Mopria Alliance, a global nonprofit membership organization formed to promote, simplify, and increase accessibility of wireless printing from smartphones, tablets, and other mobile devices. The Mopria Alliance aims to bring together the mobile, software, and print industries with the goal of aligning to standards that make printing universally compatible from any mobile device to any printer anywhere.

By the end of 2013, it’s estimated that the number of mobile-connected devices will exceed the number of people on earth, changing the way people do everything from capturing memories to managing work on the go. Currently, 40 percent of employees use their own smart phones in the workplace, and in the next three years, the number is expected to increase to 56 percent. While the BYOD (Bring Your Own Device) trend has become second nature for many employees and businesses, printing from mobile devices has not. The Mopria Alliance aims to ensure that this need is met with simple, 14

ubiquitous wireless print capability across software, mobile, and print devices. “The Mopria Alliance is all about simplicity. If a person is at home, in the office, or traveling on the road, they want a simple, secure mobile printing experience. The Alliance embodies the freedom to print from anywhere from any device. It’s that simple,” said Karl Dueland, vice president of the solutions delivery unit at Xerox. The Mopria standards will be available soon. Members of the alliance will begin incorporating the standard in their products in the coming months. Companies interested in joining the Mopria Alliance can find more information at www. mopria.org/membership.

Third Time’s a Charm: Tata Takes Off with Singapore Airlines Alliance

Eighteen years after a first failed attempt, Tata Group has again joined hands with Singapore Airlines to start a new full-service airline in India, according to The Economic Times. Tata Sons, the holding company of most of the operating firms of the $100 billion–plus conglomerate Tata Group, signed an MoU with Singapore Airlines in September under which it will own a 51 percent stake in the proposed carrier. The rest will be with Singapore Airlines. The group, which had in February announced a partnership with Malaysia’s Air Asia for a low-cost carrier in India, said it has applied for approval from India’s Foreign Investment Promotion Board (FIPB) to establish the new airline, which will be based in New Delhi. This is the third attempt by the two partners to enter the Indian civil aviation sector, with the previous tries coming in 1995 and 2000.

Big Pharma Players Join JPMorgan and Gates Foundation in Vaccine Investment Fund

JPMorgan Chase and the Bill & Melinda Gates Foundation have set up a Big

Pharma–backed vaccine investment fund, and ASAP Corporate Members GlaxoSmithKline, Merck, and Pfizer are among the first investors in the fund, which will back late-stage development of technologies to fight disease in low-income countries. Having raised $94 million from its initial investors, the Global Health Investment Fund (GHIF) will now begin the process of aiding vaccines in navigating Phase III trials. The fund will, for the first time, allow individual and institutional investors the opportunity to finance late-stage global health technologies that have the potential to save millions of lives in lowincome countries by advancing the most promising interventions for fighting malaria, tuberculosis, HIV/AIDS, and maternal and infant mortality, among other conditions. “We invest in global health because we know that when health improves, life improves by every measure,” said Bill Gates, cochair of the Bill & Melinda Gates Foundation. Private sector financing for global health research and development is more important than ever. Philanthropy, government funding, and pharma industry support have built a pipeline of global health innovations, but late-stage clinical trials are costly and development expenses are outpacing charitable support. Traditional investment capital can play a meaningful role in solving this problem, particularly when it is supplied by investors who include the expected social impact of their activities in their return calculations.

England Swings: Johnson & Johnson Trumpets Multiple U.K. Collaborations Johnson & Johnson Innovation announced several new collaborations in the European region to coincide with a “Celebration of Life Science Innovation” event, hosted in October by its London Innovation Centre. The Continued on page 44 Strategic Alliance Magazine

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spotlight member

A Trust That Isn’t Manufactured CMO One 2 One’s Utilization of Alliance Management Principles Has Helped Build Long-Term Relationships with Clients By Jon Lavietes

FOR TODAY’S AVERAGE PHARMACEUTICAL COMPANY, there is more incentive to work very closely with contract manufacturing organizations (CMOs) than ever. Costly high-profile manufacturing failures litter the pharmaceutical industry’s past. A few years ago, the U.S. Food and Drug Administration (FDA) recalled the anticoagulant Heparin after several deaths were linked to contaminated batches produced in China.

One 2 One in a Flash A global CMO, serving the biopharma industry for more than 25 years 15 of the top 20 biopharma companies in its customer base

“If you’re not close with your customer, you’re putting yourself in a major high-risk situation for some products that make amazing money for these companies, or are the only therapy available for certain patient populations,” said David Powell, director of business development at One 2 One.

Produces more than 50 drug products for On the other end of the spectrum, commercial sale, of which 18 are complex large more than a decade ago Amgen molecules (i.e., biologics) and Wyeth’s blockbuster arthritis Acquired more than 30 new partners over drug Enbrel represented a major Building a Pharma the past five years, from virtual biotechs to large potential cash cow. Unfortunately, “Safe House” pharma companies they failed to capitalize fully on How does alliance management their market opportunity because they couldn’t ramp up their play out in a CMO–pharmaceutical company agreement? Powell manufacturing capabilities to meet the overwhelming initial (pictured above) and his colleague Mark Ward, alliance manager demand for the drug. But even without a large-scale disaster, it at One 2 One, tell the story of two separate occurrences where clisimply costs too much time, money, and resources to switch to a ents that received severe regulatory sanctions from the FDA for different CMO if you don’t like your first choice for any reason. operations at plants it deemed to be in noncompliance transferred So it pays to get this kind of partnering right the first time. a multitude of manufacturing activities related to the sites in quesFor One 2 One, a global CMO with operations on every continent and a business unit of specialty pharmaceutical company Hospira, the feeling is mutual. The company applies alliance management principles directly to many of its customer relationships, and insists on maintaining a close collaboration wherever a client is willing. Quarter 4, 2013

tion to One 2 One. Where no one would have blamed the CMO for keeping a distance from the situation, the company actually worked hand-in-hand with its clients to come up with solutions that would be submitted to the regulatory agency—and even went as far as to voluntarily include its name and manufacturing processes in all of the paperwork that got delivered to the FDA.

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“Some CMOs would say, ‘You know what? It’s time to get out of this relationship. You got into big trouble. You’re going to have so many problems [for a long time]. We’re just going to go and move on our way,’” said Ward. “For us, it was just the opposite. We saw it as an opportunity to demonstrate a partnership and willingness to get in there with them.” Suddenly, One 2 One saw the two respective client product portfolios increase significantly. In order to rectify the situation in the FDA’s eyes, One 2 One ultimately had to port drugs from the customers’ troubled plants to the CMO’s facilities. With an increased commitment to the relationship from each partner and significantly more at stake for the alliances as a whole, One 2 One and its partners had to adjust its application of alliance management tools and methodologies accordingly. The governance committees now had to connect executives at the highest levels. Metrics were revised to measure the alliance’s success in transferring the clients’ products to One 2 One’s site and shutting down the clients’ problem manufacturing sites within an aggressive timeframe. For example, the FDA required monthly reports validating the transfer of technology to the new manufacturing site and verifying that this new plant could produce the same product as the old facility. Both partners tracked internally whether the required information was being delivered to the FDA accurately and on time—“in a very absolute, regimented fashion,” according to Ward. Ultimately, One 2 One helped its clients reduce a process that normally takes two or three years down to 12 to 18 months. With an FDA-approved site up and running, One 2 One’s business with the clients increased dramatically after the CMO helped them minimize and/or avoid harsh federal financial penalties.

But by most accounts this was not the case back in 2004, when a convergence of several factors led the company to decide to apply the alliance approach to its business. That year, Abbott Laboratories spun off Hospira as a company. Hospira was responsible for Abbott’s “fill finish” products—injectable drugs administered Mark Ward, alliance manager at One 2 One. by syringe or other means. Suddenly, what was once a smaller unit of a big company was now its own entity, and the spinoff came with tremendous revenue growth expectations from new investors. For the first time in its history, One 2 One had to separate its existing customer management and new business functions. It concluded that alliance management could facilitate this transition for several reasons. First, customer-centricity was in its DNA. Compared with other CMOs at the time, Hospira’s drug delivery origins required a much closer collaboration with pharmaceutical and biotech companies in delivering Abbott’s remedies. After all, before it was renamed One 2 One, the unit was called Abbott Pharmaceutical Partnerships. Second, around the time of the spinoff, One 2 One became aware of Eli Lilly’s alliance management approach with its drug development partners and was impressed with Lilly’s use of tools, one of which was the alliance health check, identifying with its emphasis on intangibles and soft metrics.

Alliance Management “The company saw us as an outlet to really solve even more of Tools Fully Entrenched their problems. Anything they felt was possibly at risk internally they began to move to us,” said Ward. “We became kind of a safe house, so to speak.” The benefits of executing a high-risk/high-reward initiative of this type extend far beyond increased business from the client. “It changes the whole dynamic of how that company views you. We have had incredible CEO visibility. [We were looked] at as saviors to some degree in terms of product supply to their patients in very, very drastic times,” added Ward.

A Long History of Using an Alliance Approach Powell concedes that implementing an alliance management approach to customer relationships is hardly novel for CMOs today. “Now I think [alliance management] is more commonplace,” he said. “It’s not like we’re standing out.” Quarter 4, 2013

An ASAP Corporate Member since 2008, One 2 One has deeply integrated the tools and practices common in the ASAP community into its operations for some time. The company’s core metrics include: n Governance structure – Have we collaboratively installed an oversight framework appropriate for the relationship? n Active Pharmaceutical Ingredient (API)/Bulk Drug Yield – Are processes yielding the highest percentage of final product per batch? n Cycle time – How long does it take to receive the bulk drug and convert it into a commercially released product? n Quality performance – Are the company’s quality systems ahead of regulatory agency standards and industry norms? Are potential noncompliance issues being documented and properly investigated? Are issues with batches resolved timely and successfully? n Adherence to schedule – Are both the company and Continued on page 45 17

Connecting the Dots That Can’t Yet Be Seen THE POTENTIAL FOR monumental game-changing innovation—and disruption—is everywhere. It will eventually come in a blur, and you will either be driving it or getting bowled over by it. No industry will be spared.

Alliance Managers Will Have to Reimagine Their Value Chains to Achieve the Next Breakthrough Innovation By Jon Lavietes 18

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Comply or Die (or Just Pay Millions in Fines)

The Alliance Manager Can Play a Major Role in Preventing Costly Instances of Marketing Noncompliance By Jon Lavietes

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The Spotlight Intensifies Opportunity for Biopharma Alliance Professionals Grows as Companies’ Strategic Focus Sharpens— and the Executive Suite Looks to Alliance Management to Deliver By Jan Twombly, CSAP, and Jeff Shuman, CSAP, Ph.D.

WHEN THE RHYTHM OF BUSINESS PRESENTED the results of its 2012 Practice of Alliance Management in the Biopharmaceutical Industry Study at the ASAP Biopharma Conference last year, the overarching conclusion we shared was that the performance of alliance managers is now in the spotlight—and it’s executive leadership that constitutes the principal audience.

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By Brent H. Harvey, CA-AM, David S. Thompson, CA-AM, and Steven E. Twait, CSAP

As alliance professionals, one of our primary roles is to help clients structure and manage all elements of a partnership with the aim of achieving a long-term goal. We work hard to establish an alliance vision, define each partnerâ&#x20AC;&#x2122;s roles and responsibilities, and create a plan to manage contractual obligations. We then review and revise the plan during the course of the allianceâ&#x20AC;&#x2122;s life cycle.

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So while it’s clear that we have the process well in hand for our clients, how often do we apply that same rigor to our own alliance management organizations? It would seem that when it comes to business planning, just as in other areas of life, it is often inadvertently a case of “Do as I say, not as I do!” This inconsistency is understandable for a variety of reasons. Generating a business plan is time consuming, and it can easily pull you away from what seems to be an ever-expanding list of daily alliance management tasks. There’s also the question of relevance: by the time you finish writing the plan, it’s obsolete, right? While avoiding business planning is easy, committing to a rigorous planning process can prove extremely beneficial. In many ways, creating a comprehensive business plan is like embarking on a sustainable fitness program—both require dedication over the long haul, not just a few weeks. You may decide to exercise and eat right to address a current health problem or to prevent future issues, and you may not see immediate results—and might even want to quit!—at different points along the way. But if you set realistic goals, review your progress regularly, and make necessary adjustments, you will achieve the desired outcome. The same is true of business planning: if you construct a logical framework and stick to your process, you will almost certainly improve the effectiveness of your alliance management organization. In this article, we describe why and how our alliance management team approaches the business planning process to address the strategic, operational, and financial aspects of our business, the results we have achieved, and how we continue to review, revise, and improve our methods. Our hope is that this information might prove useful as you look to improve the effectiveness of your own group and better serve your clients.

Plan to Thrive Let’s start with the “why” that first prompted our planning efforts. While our company has had a long history of commercial collaborations and a passion for alliance management work, several years ago we made a conscious choice to enhance and expand our internal practice. To set ourselves up for long-term success, we decided to operate our alliance management organization like a boutique consulting firm within a large corporation, with a 40

clear focus on delivering value to clients. Our mindset was one of a for-profit entity that could clearly demonstrate its worth. We also knew that to compete effectively for internal resources, we needed to demonstrate our contributions more vividly and consistently to our clients. To ensure the viability of our vision, to organize our thinking, and to help secure and assign resources, we set out to develop a business plan. We were—and remain—excited about striving to run our alliance management group in a professional, clientfocused way. We have derived a sense of empowerment from this partner-centric model, and that in turn has served as a strong impetus to our business planning process. As we embarked on our journey, we sought to address four strategic questions: 1. Who are alliance management’s key clients and what do they want from an alliance manager? 2. What needs to be done and what needs to be avoided to build a successful alliance management organization? 3. What metrics must be developed to foster successful alliance management behaviors? 4. How do we effectively prioritize the many competing activities facing an alliance manager? With these central questions as a base, we began the process of articulating a crisp vision, strategy, and action plan for our alliance management firm to ensure that we would deliver consistent, measurable benefits to our clients.

Take a Sustainable Approach Now let’s examine how we went about developing the business plan. To start, we wanted the “principals” of our firm to play an integral role in the process, and fortunately we had a core team of professionals who shared a deep commitment to the practice and were proponents of a client-focused alliance management concept. This core team, which comprised our chief alliance officer and several seasoned alliance managers from diverse backgrounds, began mapping out the process. At the outset, the team had to decide on an approach to plan development. We realized that you can take many approaches: completely outsource the work to a consulting firm, hire an expert for advice, or develop it in-house. Given our motivation and sense of urgency, we chose to Strategic Alliance Magazine

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develop our plan in-house using a template from SCORE (originally Service Corps of Retired Executives, but now known as Counselors to America’s Small Business), a nonprofit association dedicated to “helping small businesses… grow and achieve their goals through education and mentorship” (see www.score.org). The small business focus aligned nicely with our boutique consulting firm approach, and the group’s site provided a practical template that was easy to use, enabling us to focus our efforts on content creation. Using the SCORE template as a framework, we decided to structure our plan in these sections: i. Executive summary ii. General firm overview iii. Integrated products/services iv. Environmental overview v. Operational plan vi. Leadership team and organizational structure vii. Financial plan viii. Client action plan ix. Accountability metrics To create a first draft, each member of the core team took the lead in authoring two or three sections, with individuals covering their specific areas of expertise whenever possible. As anyone who has been tasked with writing a plan can confirm, putting ideas on paper was no easy duty. It forced us to be articulate and concise. We also spent significant time on integration and ﬂow because there were multiple authors, but after several months and many review cycles, we were able to develop a plan we felt good about. At that point, we took the opportunity to “pressure test” the plan with select colleagues outside alliance management. This step provided valuable, objective perspectives and insights. After weighing and incorporating the feedback into our document, we began putting our plan into practice. Knowing that we wanted to keep our plan vital and relevant, we built in an iterative four-step process of “plan, do, evaluate, revise.” To implement this process, we met—and continue to meet—regularly to ensure that the plan reﬂects our current knowledge and to make certain we are on track in meeting our clients’ needs.

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beneficial result of the process has been to instill in our group a deep understanding of what we are attempting to achieve and the behaviors we need to demonstrate to attain our objectives. Our original in-house planning approach relied extensively on extra effort by our team, and this work yielded powerful outcomes in terms of crystallizing concepts, strengthening the team, and building buy-in. In addition, the process uncovered specific areas in which our alliance management group needed to improve. With our energies focused squarely on instilling and operating within a boutique consulting firm mindset, we concentrated on four objectives: 1. Documenting our products and services to help increase our entire department’s knowledge level and improve our ability to consistently deliver value. 2. Creating metrics that track the products we are selling and services we are performing and highlight key upcoming alliance events. 3. Capturing value to document outcomes of complicated problems solved by alliance management, including alliance management’s role and the quantified value. 4. Taking a more strategic approach to client interactions. To make sure our group understood the importance of meeting these objectives, we increased communication throughout the entire department, and we addressed each issue as described below. The first revelation of our business plan research was that we needed to reduce the variability in how we managed alliances; that is, we wanted our clients to be neutral as to which alliance manager was assigned to their alliances, rather than having favorites. We strongly suspected that our clients preferred certain alliance managers based on their skill and consistency in delivering alliance services. We needed to reduce these variations without eliminating the creativity and individuality of each alliance manager. To this end, we coined the phrase “binder project” to describe an initiative to prepare guidelines and procedures for the more than 30 products and services we highlighted in our business plan. These 30 items were considered core work for all alliance managers, so everyone in the alliance

Focus on Clients, Continuous Improvement Finally, let’s explore how our business plan has helped us improve our organization and better serve clients. The first Quarter 4, 2013

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management practice participated in the binder project. (Examples of products and services include alliance start-up, governance implementation, crisis management, strategic future, and 3-D fit.) The online binder we created through this initiative, the OAM e-Binder, serves as a valuable alliance management toolkit resource. Each product or service, as shown in the figure below, has a hyperlink to information such as guidelines, job aids, and examples. Yet again, the beneficial side effect of this process has been that the entire alliance management team is familiar with the most effective tools for dealing with alliance issues, having had the chance to discuss and compare notes with one another while developing the binder. To address our second issue, we created online standardized metrics to track the frequency of product and service use as well as key upcoming alliance events such as clinical results, regulatory submissions, product approvals, etc. The metrics provide information on what we have been doing and where we spend our time. These metrics are used as lagging indicators of success. (For

more information on metrics, refer to the article “Measuring Alliance Management” in Strategic Alliance Magazine, Q3 2011, http://www.lilly.com/pdf/SAM_q3_2011Metrics.pdf.) The key events that we capture provide a forward-looking view, helping to ensure that alliance managers anticipate important milestones and initiate the appropriate conversations and meetings to prepare. Our third objective was inspired by the discovery that our clients regarded our ability to solve complicated alliance problems as one of the most valued services we provide. Given the importance of this offering, we set out to formally capture its value. As guiding principles in accomplishing this, we aimed to be conservative in quantifying alliance management’s contribution and to obtain client leadership’s endorsement on this value. For example, if an alliance manager’s role on the team was that of basic team member, this most likely would translate to a low contribution or low portion of the total project value. On the other hand, if the alliance manager’s role was that of project leader—a more desirable role—this would

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translate to a higher portion of the total project value. To this point, our calculable value has been derived primarily from leading projects that ultimately generate direct cost savings or revenue enhancements. Finally, we saw an opportunity to take a more strategic approach to client interactions. We viewed the scope of this objective broadly, with our definition of “clients” including not only the leaders we interact with directly on the alliance, but also the leaders of the business units and functional areas in legal, finance, and human resources. We now make a concerted effort to provide high-level updates on our contributions, share critical events that we anticipate and should prepare for, and ask for feedback on how clients perceive our performance and the state of our relationship. To expand the professional development of our consulting staff, we also have been applying concepts from Peter Block’s Flawless Consulting to team-teach best practices.

Keep Moving Forward Each year, our business plan has evolved as we systematically follow the process of plan, do, evaluate, and revise. While the strategic and financial components typically have minor updates, our operational component has evolved significantly. As a result of what we have learned through the iterative planning process, we currently are moving forward in three new areas: 1. Expanding our practice into new business areas: The skills and experience alliance managers have in maximizing alliance value, managing risk, and leading governance are transferable. We have become actively engaged in collaboration projects with venture capital firms, and we have a seat at the table for important internal policy-setting discussions. We also have recently developed a new model to serve the growing number of country-focused alliances in emerging markets. 2. Expanding value-capture capabilities: After evaluating our experience in capturing value, we decided to expand our definition and then design means to calculate other ways we add value, such as when we streamline alliance activities and help avoid legal action by proactively resolving disputes. 3. Articulating alliance management’s value proposition: As we focus on building our alliance management brand, we feel it is important to have consistent messaging. Therefore, we developed a quick and easy way Quarter 4, 2013

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to tell the story of what alliance management does. The elevator speech goes something like this: We manage three types of risk; business risk, human risk, and legal uncertainty. We have demonstrated that we manage these risks in a manner that helps drive value to our client and delivers multiples of return on investment to our company. From its earliest days when it was the project of a small core team, the process of developing a comprehensive business plan has grown in importance and has set our entire alliance management department on a new trajectory. By implementing, evaluating, and adjusting our plan, we have continued to meaningfully evolve our practice to deliver greater value to our clients. Brent H. Harvey, CA-AM, is director of alliance management at Eli Lilly and Company. With responsibility for alliance management for development, commercial, and manufacturing alliances, Brent leads teams focused on maximizing the value of partnered assets at each stage of the development cycle. He is also responsible for directing corporate due diligence for alliance management. Brent has played an integral role in some of the largest development and commercial alliances in the company’s history, including worldwide partnerships with Bristol Myers Squibb and Daiichi Sankyo. He is also the alliance manager on collaboration projects with venture capital firms. Prior to joining alliance management, Brent was the financial controller on a complex worldwide partnership. Brent earned a Bachelor of Science degree in construction engineering at Purdue University and an MBA at Indiana University’s Kelley School of Business. He also has a Certification of Achievement – Alliance Management (CA-AM) and is a certified management accountant (CMA). He can be reached at Harvey_brent@Lilly.com or +1-317-655-0452. Steven E. Twait, CSAP, is senior director of alliance management and M&A integration at Eli Lilly and Company. He can be reached at stwait@lilly.com, +1-317-276-5494. David S. Thompson, CA-AM, is chief alliance officer at Eli Lilly and Company and is a member of the ASAP board of directors. He can be reached at Thompson_David_S@Lilly.com, +1- 317-277-8003.

Collaborative Buzz Collaborative Buzz Cont. from page 14 event brought together U.K. life science leaders and scientists from Johnson & Johnson to celebrate promising advances and discuss novel collaboration models to deliver better health care solutions for patients around the world. U.K. science minister David Willetts said, “The U.K. has a long tradition in using collaboration and partnership to spark new ideas and develop new advances in the life sciences. I am pleased that Johnson & Johnson [has] recognized that strength, and chosen London to be one of their world centers for innovation and collaboration.” The London Innovation Centre is one of Johnson & Johnson Innovation’s four regional hubs that focus on identifying and accelerating the most promising early-stage science that will advance the development of new health care solutions. The new collaborations across the European region include an alliance between Janssen Biotech, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson (an ASAP Global Member), and Effimune, a biotech specializing in autoimmune disease treatments; Johnson & Johnson’s investment in Merus B.V., a private, venture-backed biopharma company based in Utrecht, The Netherlands, that is building a pipeline of single-cell derived human bispecific antibodies for cancer therapy; and research collaborations with various U.K. research institutes and centers focusing on vaccines.

Triple Bottom Line: Dow–Nature Conservancy Collaboration Gets Award In October, the Harvard Kennedy School presented the 2013 Roy Family Award for Environmental Partnership to ASAP Corporate Member Dow Chemical Company and The Nature Conservancy (TNC) for their groundbreaking collaborative work to incorporate the value of natural resources into the business bottom line, according to the Harvard Gazette. To celebrate the award, leaders of Dow and TNC took part in a panel discussion at Harvard Kennedy School to describe their development of tools and models to integrate the value of forests, watersheds, and biodiversity into more sustainable business and community decisions. The panel, “Valuing Nature: Saving Ecosystems Is Good Business,” also detailed steps that other corporations and nongovernmental organiza44

tions (NGOs) can take to protect the earth’s natural resources as businesses continue to grow. The Dow-TNC union is an innovative collaboration to research the value of ecosystem services. Established in 2011, the five-year project combines the expertise of Dow, one of the world’s largest chemical manufacturers, and TNC, the foremost global land and water conservation organization, to develop tools and models that incorporate the value of natural resources into business decisions. The collaboration recently completed its first pilot at Dow’s facility in Freeport, Tex., the company’s largest manufacturing facility; it is currently in the midst of the second pilot in Santa Vitória, Brazil. A major goal of this collaboration is to produce results and findings that are replicable and transferable to Dow’s other 135 sites. In addition, most of the methodologies, tools, and results will be shared publicly with the hope that other companies, NGOs, and governments can make use of them as well.

Hoosiers: Covance and Indiana University to Collaborate on Early Clinical Research ASAP Global Member Covance Inc., a global drug development services company, and the Indiana Clinical and Translational Sciences Institute, part of the Indiana University School of Medicine, have announced an agreement to collaborate in conducting early clinical trials for new medicines on behalf of biotechnology and pharmaceutical companies. This alliance provides a significant opportunity to bring more Phase I clinical research to Indiana, through the clinical research unit located within the IU School of Medicine in Indianapolis and Covance’s clinical research unit located in Evansville. Phase I clinical research includes studies where investigational new drugs are administered to humans for the first time. Working together, the two organizations will conduct high-quality research in a safe and regulated environment for sponsors who are looking to recruit both healthy volunteers and patients for early clinical studies. “The alliance with the Indiana CTSI will help us provide biopharmaceutical clients with quicker access to patients in a hospital setting that supports specialized care and monitoring,” said Rob Aspbury, vice president and general manager of global clinical pharmacology services at Covance. “With quicker access to patients, we can streamline the drug development process and bring important new medications to patients who need them.” n Strategic Alliance Magazine

Member Spotlight Continued from page 17 its partners’ processes occurring as they are supposed to? Are partners delivering APIs and the like on schedule, so One 2 One can fulfill its part of the operation on time? One 2 One’s health checks, conducted on an annual basis by a third party to preserve anonymity, are modeled in large part after Lilly’s in that there is a heavy emphasis on the soft side of the relationship. In efforts to get a sense of whether each party is living up to the other’s standards, the health check specifically addresses elements such as customer service, trust, speed and accuracy of decision making, communication, accountability, and resources allocated. Speaking simultaneously about the aforementioned serious regulatory situations and alliance management principles in general, Ward said, “I don’t know if trust is considered a tool, but it’s an absolutely essential part of that kind of relationship.” He added, “When you’re in trouble, and you’re betting so big on someone, it has to be there.”

Customer Buy-In Is Essential— and It Doesn’t Come Cheap As Powell reflected on One 2 One’s journey over the course of nine years, two lessons learned came to mind. First, you cannot indiscriminately impose an alliance management approach on a client that is not going to reciprocate. “It’s a two-way street. You can’t just say we are going to apply alliance principles to a customer that really has no interest, you have to have buy-in on both sides,” he explained. “We learned early, it’s not for every customer, be you a large global pharma or a small biotech.” Second, if your organization is strictly focused on shortterm revenue, this might not be the approach for you. “We learned it’s not the cheap route,” said Powell. “It

takes more time, more effort, more money to apply it. There is payback in the long term in terms of maintaining customers’ loyalty and satisfaction, but to monetize that [investment] it’s an outlay of time and resources.” But both Powell and Ward make it clear that the payoff is well worth it over the long haul. By placing such a heavy investment up front into joint compliance procedures, executive-to-executive interactions, alliance manager peer relationships, and adaptations to the client’s processes, it is easier, quicker, and cheaper to acquire additional drugs from the customer thereafter. “The next product they have that is similar, in their minds they know you. You’re there for the long term, both from a cost and a security-of-supply standpoint. They know what they’re getting into if they funnel that next product toward you,” said Ward. He added that the repeat business dovetails nicely with an emerging trend in the alliance management community—pruning the supplier portfolio to rely on fewer partners. “There’s more business in fewer locations [for the client]. It’s easier to manage one company than it is to manage five.” Most important, Ward felt that the alliance-oriented approach put the company on a solid footing to handle adversities faced by the company and its customers in the past, and positions it well to continue to do so in the future. “[Alliance management principles don’t] guarantee a problem-free relationship,” he noted. “What it does is it provides you a framework to work through anything that comes up to where it is being approached in an unbiased fashion.” After all, the client’s drugs can be manufactured, but its trust cannot. n

Grow your revenues and your capabilities! International ecosystem development Alliances Progress is a professional services firm specialized in designing and running international alliance partnerships. Troy J Gautier Managing Director, Chief Alliance Officer +1 678 644 2533 TroyGautier@AlliancesProgress.com Quarter 4, 2013

www.alliancesprogress.com 45

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R E G U L A R

F E A T U R E

alliance

champion Leading from the Center Andy Eibling Brings Years of Big Pharma Experience to Bear on Formalizing the Alliance Management Practice at CRO Covance By Michael Burke

WHEN ANDY EIBLING ARRIVED at the contract research organization (CRO) Covance in January 2011, after almost a quarter century at Big Pharma player Eli Lilly and Company, he knew there would be a difference, but figured it would be modest. After all, in his more than 24 years at Lilly he estimated that he spent “half or more of that time working in alliance management and business development,” and he was coming into Covance as a vice president of alliance management with responsibility for its long-term strategic alliance with Lilly. But Eibling was not wholly prepared for the magnitude of the shift in size and scope, or the change of perspective involved in coming into a CRO. “I knew there were going to be cultural changes moving from pharma, where you are generally the client or big partner working with small biotechs, to the service sector, but I underestimated the impact,” he admitted. “I’ve spent a good portion of my last three years learning about the dynamics of this industry and Covance’s business model. Once I better understood the challenges and opportunities facing CROs and the unique value proposition Covance could offer, I could then help scope out the direction we want to go, both in the partnerships we’re managing and as an organization.” Eibling held a number of roles at Lilly beginning in the late 1980s, most involving business development or alliance management, and culminating in the position of director of business development from 2009 to 2011. He credits this background with preparing him for his current role at Covance, while noting that the companies’ respective positions on the biopharma playing field are quite different, and their mindsets reflect this. Quarter 4, 2013

Changes in Attitude “The partnerships we engaged in at Lilly were of a codevelopment, comarketing nature,” he explained. “You’re working with a partner around one piece of innovation you’ve chosen to develop together or take to market together. There is a feeling of shared risk and involvement, but it is limited to that specific compound or technology. In the CRO industry, Covance’s relationship with Lilly was groundbreaking in scale, scope, and the many points of shared risk. [We had] the acquisition of the plant site, the transfer of employees, and an enormous cultural and operational joining of the companies. It wasn’t about providing transactional services over time for advantaged pricing. “Still, there’s a perception by many in the biopharma industry that at the end of the day a CRO is just a service provider, a vendor. We’re seeing that mindset change and we’re actively trying to change it—it has to change. As pharma has gotten smaller, a lot of employees from pharma are now at CROs, so there’s a shift in intellectual capital. Twenty years ago, CROs were seen as good, though perhaps not as good as pharma in performing tasks pharma viewed as tactical and noncore. Now we’re viewed to be just as good [if not better given significant outsourcing] at much of the transactional work, and an increasing amount of strategic activities that were viewed as core to pharma have landed with us. We help design solutions that get a drug to market faster and more cheaply, a better-quality answer. We have to transform those re51

lationships to where there is more of an element of collaboration— we’re really talking about solutions instead of ‘tell us what you want to do and we’ll do it.’ Innovation and opportunity still belong to the pharma company—we’re not going to change that. But if we can collaborate more effectively and openly and shed some of this vendor-client mentality, we can really drive better solutions to the marketplace.”

The Center Can Hold: Covance, Lilly, and Alliance Management The rise of CROs has provided a golden opportunity to the likes of Covance, and to alliance professionals like Eibling. In particular, the ability of CROs to handle the research aspects of the biopharma life cycle that traditional pharma companies no longer want to deal with means that those CRO–Big Pharma partnerships—such as the one Eibling oversees between Covance and Lilly—are increasingly common and important. “The quality is there, the capabilities are there, for the pharma companies that are more progressive in how they leverage those relationships—they’re getting much more value out of them,” said Eibling. “It’s still an interesting discussion to talk to pharma about what things we can do, and what things maybe we shouldn’t be doing: those strategic conversations about core capabilities, how to augment or absorb and execute those that aren’t core, better/cheaper/faster because of efficiency. We have to continue to advance the dialogue, because if you stay still, you get passed. That’s why we value these partnerships so much.” While Lilly has for some time been seen as one of the pioneers of the practice of alliance management, Covance has its own alliance management capability that is “maturing as we speak,” according to Eibling. The practice is organized in a way specific to Covance’s business and its role in the value chain as a CRO. “We provide services that span the entire value chain of pharma, from discovery research through late-phase clinical development and postlaunch commercial support,” Eibling explained. “We’re organized into business units that provide those services. We have enterprise alliance managers like myself responsible for significant alliance partnerships that span a number of those business units. We also have alliance managers who are at the helm of alliances for a single business or specific service lines within Covance. Rather than doing a major restructuring, we’ve created a virtual network of alliance managers. We’re building the competency across the business units in that way—I refer to it as a ‘center-led organization.’ The group of us that are enterprise alliance managers are helping to lead the way in establishing what the competency means at Covance, best practices, commonality, and linkage across all these roles. We’re working across the matrix of the organization, which most alliance managers are used to doing. “We have alliance managers watching over the separate steps, with 52

enterprise alliance management overseeing the whole thing. As such, those folks tend to be the most experienced, understanding the broader business. So we’re leading that partnership, coaching and mentoring those around us, developing best practices and toolsets, looking at training and developing skills. You could call us a ‘center of excellence,’ but we’ve chosen not to use that language because we want the whole organization to be that. We are guiding the rest of our alliance colleagues, with the support of senior leadership, to become more fluent at this work. For many of these partnerships, while there may be issues you get involved in to help get them resolved, you’re not down there every day. We help ensure that the right infrastructure is in place—the right metrics, right people, right environment in each of those areas—to be successful. As opportunities or issues arise, we can help push those forward to make them happen, connect the dots with our peers. So somebody is always watching [over the process].”

Talk About an Evolution Eibling said that since he arrived on the scene at Covance, bearing his years of alliance management experience at Lilly, Covance’s own alliance management practice has seen “more of an evolution than a big change.” “We have formalized the role and established what it means,” he said. “Each business was kind of doing their own thing. We’ve progressed since then, working across teams to create more commonality. We joined ASAP, increased our involvement with ASAP, and really pushed and endorsed certification as a means to create a common language across all the folks doing this work. And we’ve experienced great success there. We have not [totally] reorganized, because we wanted to leave the autonomy and ownership in the business units, but we do recognize the need for a center of competency. A lot of organizations struggle with this. “On the service side, everyone is extremely partner focused—it’s part of our DNA. There’s a uniform groundswell and support [for this at Covance]—[people say] ‘I would love to have the help.’ So we as the alliance management team haven’t had to fight to become involved. By creating alignment, providing value to everybody, we’ve gotten very good support from the business.” While partnering is integral to the way Covance does business, Eibling said the company has experienced its own growth in the maturity of its understanding and practice of alliance management, much like other organizations. “In the early days of establishing [alliance management] at Lilly, a whole cultural shift needed to happen, from ‘not invented here’ to supporting partnered innovation,” he recalled. “At Covance, we were able to skip past some of those steps. This organization is extremely focused on making sure partnerships are successful. Still, we’ve had to do a decent amount of education —all organizations go through that. We’ve had to explain and differentiate the role as specialized Strategic Alliance Magazine

and adding value, that it very much augments the existing roles in the organization today. At the end of the day, we need all of our client relationships to be successful; it’s more of our business model than in other companies, that’s where our revenue comes from.”

Ten Years After In his own career, Eibling said he was first exposed to alliances in the 1990s in a business development role at Lilly. “Because of their unique nature, it was clear these were revenuegenerating opportunities someone needed to take care of,” he said. “Moving into that role, that was my first real exposure [to alliances]. It happened to coincide with Lilly going through some strategic decisions with partnering as a core strategic imperative. It’s that extra step of, if partnering is going to be important, how do we get good at it? From the outside, I still see [Lilly] as among the best. That early work has paid off for them.” Covance was originally spun off from Corning, but its relationship with Lilly quickly became key to the company’s existence and success. Covance purchased its Greenfield, Ind., drug development facility from Lilly and agreed to provide Lilly with drug development services for 10 years. The partnership with Lilly is still going, and has been extended for a year so far. “Covance has done several other large deals since, but Lilly was the first, and it was groundbreaking,” Eibling said. “It’s an extremely important partnership to Covance. I spend my time making sure all parts are successful, making sure we’re pushing to do more and better, that we find ways to innovate. I had the opportunity to learn from some great people at Lilly, and work on some very challenging partnerships—but I honestly can say I never worked on one as farreaching and complicated as this one. There are thousands of people touching this partnership on a daily basis, hundreds of pieces across the value chain. The alliance is worth $1.6 billion over 10 years, and Lilly has exceeded their commitments, just to give you an idea of the magnitude of this thing. It’s fascinating to be a part of, incredibly challenging. There are a lot of ‘failure nodes’ or places where the alliance can break, so great attention is paid to heightening people’s awareness and, where necessary, shifting behavior at these essential points to reinforce its success.”

After the Thrill Is Gone: Or, From Refrigerator to Buick

In fact, along with Lilly’s Steve Twait, and Ken Carlson, Eibling will be doing a presentation at the 2013 ASAP BioPharma Conference in November in Boston on managing such a large, ongoing partnership. What do you do when the initial excitement of the alliance wears off and you’re left to care for, feed, and manage a many-faceted behemoth and try to keep it profitable and on track? “We did an interesting exercise last summer with that group, about keeping an alliance fresh,” Eibling recounted. “There’s that honeymoon period when you sign the deal, everybody’s talking about

how great it’s going to be and the value you’re going to achieve. After a three-, four-, five-year period, it’s ‘been there, done that.’ You’re not as enamored of each other anymore. You’ve changed, the industry’s changed, the companies have changed, the people have changed. Ken said we need to stop, engage, think about how we’ve changed, what our original strategy was, what changes we need to make, what opportunities that provides for us that we’re not taking advantage of. At some point you’ve got to step back and say OK, let’s reexamine the strategy, make sure we’re still aligned. It’s easy to lose your way—like going out to buy a refrigerator, and you come home with a Buick. It was a good exercise—we’re still leveraging that, working on some of the things we surfaced.” In Eibling’s mind, the profession of alliance management and its associated tools, concepts, and practices have their own history and their own trajectory. Its growth is tied in not only with their use at companies and in particular industries but with the growth of ASAP. “At Lilly we were building stuff—tools, terminology, it just didn’t exist,” Eibling remembered. “To a large extent we did it ourselves, with the help of others. [Now it’s] ‘What is out there that we can pull in and make our own?’ That’s the value of being a member of ASAP. Trying to get our folks to be engaged with ASAP, pulling out best practices. [The ASAP Handbook of Alliance Management] has been a great reference tool for us, in terms of learning from and helping people to understand what the competency looks like. When you’re a pioneer you have to do a lot of stuff nobody’s ever done before. You’re giving more than you’re getting, to put it crudely. We’re on the other side of that now. We’re in the position where we can learn a lot, and ASAP has the potential to be that clearinghouse of knowledge. That’s where there’s a lot of value for us. The challenge is getting people engaged.”

Further On Up the Road And the road ahead for Eibling, Covance, and the practice of alliance management in biopharma? “If I think about the pharmaceutical and CRO industry, many of today’s relationships are still rooted in a transactional mindset; you’re still paying for work. But we’re going to continue to see innovative working relationships unfold,” Eibling posited. “Pharma companies are saying, ‘OK, we’ve got to really think differently about this.’ There are pilots happening—in some cases fairly radical partnering methods being employed in an almost ‘burn-the-boats’ fashion— and there’s no turning back. It can be painful, but it does force a culture shift that you’ve got to have. “When we work with pharma, we consult, advise, collaborate. At Covance we believe we are accountable to help them develop better solutions, faster; to use decision-driving data in novel ways to help [medicines] get to patients more quickly. Both sides need to be very open-minded in how we craft those relationships and deliver outcomes that we’re all going to be dependent on as we get older. It’s exciting to be in a profession that can play an important role in such essential work. It’s why I love what I do!” n 53

Quarter 4, 2013

Overset on page “57’

the close

A New Perspective

Our Association and Alliance Initiatives Are Doing More Than Simply Helping Our Careers and Company Alliances By Jack Pearson, CSAP

COMING INTO THIS YEAR, I THOUGHT I had seen ASAP and the alliance management discipline from every angle. I had built Quintiles’ Global Alliance Management Group, opened up new business opportunities in emerging markets, and designed the competencies that would define the people the company hired to be part of the practice. As I joined ASAP and eventually became its vice chairman, we worked to establish the association’s certification standards, which now help hundreds of alliance managers maintain their skills and keep their careers on an upward trajectory. And like all ASAP members, I have learned new ways to approach and address alliance issues via a variety of alliance success stories, honed relationships with old and new partners, and become more aware of the acceptance alliance management has gained throughout industries across the globe. But in my recently concluded five-month stint as ASAP’s acting CEO, I have seen all of these elements from a different viewpoint. I have a new perspective on how the work we put into ASAP intersects with the bigger issues we address on behalf of each of our organizations. To elevate this connection and make it more visible externally, ASAP has contributed an article that will be published in HR West Magazine this fall. The piece will speak to what HR professionals might want to be aware of in identifying and hiring people designated specifically to help their organizations thrive in an increasingly collaborative business world. While we establish this dialogue with the broader HR community, some of our most dedicated members have already brought this vision to life in their company. Specifically, SAS earned an ASAP Alliance Excellence Award in 2012 in part for its efforts to work with its HR organization to outline the roles, qualifications, and responsibilities for the company’s alliance management group. The point here is that the contributions made by a well-defined, organized, and integrated alliance team and strategy are now being brought to the attention of corporate functions that traditionally contribute to the design of the organizational workforce. Being interim CEO has allowed me to see more clearly than ever before how and why the effort and focus of 54

an effectively implemented partnership function can take the business world to new heights. Later this year we will implement new initiatives such as the ASAP Accredited Educator Partner (AEP) program, a certification offering set featuring continually updated industry-specific content and a much broader availability of globally based educators using materials tailored to each country’s needs. Additionally, we will be instituting new vehicles to communicate to parties outside of our membership that have yet to realize the significant impact a strong partnership management strategy can make on the future success of their organization. We will also target our communication to companies that can use alliance management to strengthen their own business prospects via investment management, consulting improvements, and educational support. Finally, global initiatives are under development that will take the concept of strategic alliance oversight to geographies that have been underserved in this regard. All of this is designed to execute on ASAP chairman Russ Buchanan’s directive to bring a more strategic approach as opposed to tactical oversight thinking in 2014 (see “Up Front,” p. 5), which will in turn help us expand the number of unique business alliances such as the Cisco-Xerox and NetApp-Citrix partnerships that make a tremendous impact on the global business arena. Our members’ contributions will do more than just help ASAP realize its goals; they will help alliance management professionals capitalize on the opportunity to influence an increasingly collaborative business world. Even as we do our daily jobs, and especially as we work within ASAP to grow ourselves and our profession, we should always keep in mind that we no longer have to ask for the chance to make a broader impact on our companies; we’re already driving that transformation. n Strategic Alliance Magazine

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