Executive Call Series: OutMatch Best Practices for Navigating Large Pharmas. All Levels. February 5th, 2020 - session presented twice with different discussion, North America & APAC Time Zones. Q&A excerpt from transcribed notes, lightly edited.
Rachael Craig, CEO at MotionHall: The first question that I have today, one that was submitted ahead of time, is: "How can we best address new contacts at potential target companies and cut through the noise in order to generate a productive response?”
Rachael Craig, CEO at MotionHall: For those of you who've run this process before, and are doing again, you’ll know there are a lot of answers to this particular question, and we're only going be able to address a few of those on this call today. And we’re going to focus on this question specifically in the context of navigating large pharmas.
High-level, you want to invest a lot of time in planning your approach, no surprise, and you want to find those companies that really fit, as well as the people who really fit and make sense for the conversation you want to have. You really want to build a strong sense and do your research to figure out how your product or potentially your M&A deal will move within the company as different stakeholders and committees get involved.
There's a quote here that I really appreciate, from Jeremy Levin, Chairman and CEO of Ovid Therapeutics, a respected dealmaker, and he says, "You must know more about the person sitting across the table than they know about themselves. You must put yourself in their place emotionally, you must put yourself in their place economically, and you must put yourself in their place strategically.
You must know more about the person sitting across the table than they know about themselves. You must put yourself in their place emotionally, you must put yourself in their place economically, and you must put yourself in their place strategically.
And so, what does that mean?
In this professional context, what it really means is better understanding how your product might move through their organization at certain levels better than they do themselves. And I'll talk to you a little bit now about how you can know more about that than the person across the table and why it's achievable to get that information.
As an example, a frustrated dealmaker at Novartis was telling me she speaks to so many companies who appear to have interesting platform technology and she said, “At least help me understand who in my company is going to work with this technology and what programs we have where it might apply. Because I see so many deals, and I can’t understand all the science, and I won't understand who to talk to or what to do.”
So, bringing this back to what we can do and our process, even if you've got the best new product in the world, the burden is going to be on your team to do that work because that's either how we're going to get our deal done, or that's what we're going to do to create the leverage that drives value and gets us the best price for our deal. Example, Demonstration from the OutMatch Professional Out-Licensing Service:
I want to flip over for just a moment into OutMatch, and show a little bit about how we do that. This will be familiar to some, and not so much to others. Hopefully, everyone can see this now (Figure 1).
When we're in OutMatch, which again, is our premium tool for dealmakers looking at potential buyers for a particular product. And we're going to look at what the product being transacted is and in this case, we've got a pre-clinical immuno-oncology bundle up for transaction, and we're looking at 79 high quality potential matches across the globe, including the large pharmas.
Figure 1: OutMatch Professional, Out-Licensing Market Dashboard
When we're looking at partners that fit, and these match scores are based on that quality of fitboth how likely the company is to get involved in a transaction, as well as the overall long term quality. We're looking at all those pieces that are going to help us understand what it's going to be like to approach that company, why our product fits and how we're going to bring that into conversations there.
Right now, I'm just showing you a little demo of Novartis (Figure 2). You can see that there's an overall fit that's being summarized:
Figure 2: OutMatch Professional Company Card, Novartis Summary Tab
Again, pieces to know and this is worth knowing, of course, whether you're working with the MotionHall platform or not.
Deal Activity: What kinds of deals has this company done in the past? Do they look anything like the deals that we are interested in for our company? If they do, that can be helpful in our conversations, and it can help us understand that the company's familiar with the type of deal structure that we're interested in.
Pipeline: We also want to look at the pipeline. How dedicated are they to our therapeutic area? Out of all those products in their pipeline, how does our product fit relative to those? If it's a platform technology, how does that platform relate to that pipeline work? If it's an asset, how does that relate?
Marketed Drugs: Where is our product going to fit into a portfolio with marketed drugs? Where's that sales force that's going to help us distribute?
Stated Interest & Key Contacts: I don't want to spend too much time here, obviously want to figure out who on the BD team actually has experience relevant in our area.
Scientific Synergies: Then finally, and I think this is one of the most important pieces for detailed work, and it's often under-leveraged but really powerful for getting a deal done, and something our membership here at MotionHall really enjoys. So our scientific synergies piece here is bringing up related scienceeither directly or indirectly related to the science that we're looking to transact. When you do this with MotionHall, we're going to go deeply into PubMed, into patents, and into clinical trials to find the fit. We're going to give you the option to look through those articles to see who was involved and potentially pick out scientific champions that way.
Now, whether you do this with us or not, this becomes a really powerful piece for answering the question that I mentioned earlier, right? So how does your technology fit the science at my company? Who can help me understand how this fits?
If you've done this homework, you're going to be able to position that to a dealmaker or another potential person at that partner company, starting from your first conversation. That can really help you be more effective and successful. I'm going to switch back out of the product for a moment and just return to the main conversation.
It's important to remember that when you're talking to large pharmas, you may be looking to transact with a company that has over 100,000 employees. There's a saying amongst dealmakers and sometimes there's some frustration around thisthat these large companies can feel really schizophrenic, especially if you're relying on one-on-one conversations with individuals to understand the purchasing interest or the licensing interests of that company. The reason that you can get different messages from a company, but get more clarity through the data that I just showed you is, again, tons of people within the company. The answer is the company's much larger than any individual or group of individuals, and what they discuss in small groupsthat may or may not accurately represent the overall behavior of the company and some of the incredible inertia behind that organizational behavior that goes into that fully invested pipeline, that goes into that history of the transaction, that goes into that breadth of scientific work that’s happening within the company. And so it can be the case that even the CEO can make a strong interest statement at one of these large pharmas. They may be very influential and very powerful and the company still doesn't follow through. And that's got a lot to do with the inertia of the company and then some of those factors that were taking into account with regards to match and fit.
So, again, in theory, everyone would like to license the next world-changing chronic drug. In reality, people are really limited by what they can understand. Dealmakers are going to transact for value that they can understand and you want to help them do that. And that aligns also with their strategic priorities, including the inertia of the company. That's what we're really trying to dig deep into when we work together, for our members here at MotionHall, is that behavior of the company and that fit.
If you’ve done all of that work, just to kind of tie that together, to really understand your fit to try to better know the companythat's going to empower you, from the very first email to your very first meeting and throughout the entire process as you move through the funnel. So you want to keep that first email short, sweet, and to the point, and really point out how your science fits their science and their company, and keep that rolling. And that's so rarely done at that level of tailoring detail, that it really catches people's attention. It really helps streamline the process and of course, ultimately works in your favor.
I do have a couple of other tips here that don't involve our products and services that can help you stand out and differentiate if you have your fundamentals in place. I think they're kind of fun and non-obvious, which is why I like to share them in conversations like these.
Continued conversation and discussion...
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