Alliances have long been a core strategy of biopharmaceutical companies. From early-stage biotech discovery partnerships to global codevelopment and cocommercialization pacts, these collaborations create value for the partners by accelerating drug development, leveraging resources and expertise, and sharing risk. Capturing that value is the strategic imperative for alliance leaders today.

Biopharma companies have been aggressively trimming their portfolios, culling internally developed assets, and returning partnered assets partially in an effort to reallocate funds to late-stage programs. Scientific advances and shifts in healthcare and payer policy have made therapeutic areas such as cardiovascular and metabolic diseases, and neuroscience that require large, expensive trials strategically attractive. McKinsey’s 2025 pulse check found fewer partnerships are being formed, but values are higher, and frequently for later-stage assets. The impact of these developments is that the value realized from a single alliance can have an outsized impact on enterprise value.

Alliance leaders have a spotlight on themselves and their teams to maximize value realization – often as they are managing with reduced staff. This requires proactively looking for signs that value is not being maximized – or worse, is eroding – and then acting. In order to do that, alliance leaders should implement a programmatic approach to assessing their portfolios to identify underperformers. They must also pay attention to inefficiencies in alliance operations, as well as company policies and practices that do not consider the requirements of working with partners. And just as portfolios are focusing on the most promising assets, alliance leaders focus their efforts on the most important alliances – and the priorities, deliverables, and actions of an alliance professional that drive value and manage risk.

Detect the Signals of Underperformance

Alliance underperformance rarely announces itself dramatically. Instead, it manifests itself through subtle signals that may seem isolated but are leading indicators of lost value. Chief among them is delay. Delay in making decisions, endorsing plans, staffing teams, communicating information, and more. Our VitalSigns assessments of complex alliances consistently find failure to timely make important decisions closely related to reported loss of business value.

Alliance professionals who see the core of their job as “managing the cost of time” proactively facilitate  critical decisions, putting them on the calendar well in advance of the intended decision date and orchestrating any deliverables, preliminary decisions, and internal governance meetings to get decisions made on tine. They also track slippage in deadlines, analyze why it happens, and take corrective action.

• Other signals that could be buried in dashboards, governance minutes, or hallway conversations include:
• Missed milestones or trial delays without recovery plans
• Communication breakdowns that manifest as fire drills
• Governance committees that are either too much in the operations of the alliance or that are not engaged
• Diverging strategic priorities or resource allocations
• Differing internal goals and a lack of shared alliance goals
• Lack of transparency about corporate priorities and limits placed on teams by senior leadership
• Teams that are not empowered to fulfill their responsibilities and have to take everything back to their management

Diagnose the Cause(s)

Detecting a signal of underperformance and properly identifying it is just the first step. Before taking corrective action, separate the signal or symptom from the cause. This is very similar to appreciating the difference between positions and interests, together with underlying motivations in addressing specific alliance issues. Use a structured inquiry-based diagnostic to attempt to get at the cause of the leading indicator. Depending on the situation this may need to be multi-faceted. Here is a non-exhaustive list of ways to understand the causes – and it is rarely just one cause – of the loss of value signals you are seeing.

• Start by reviewing the collaboration agreement and current dashboards to understand if there are incentives that are no longer synchronized with the intended distribution of value
• Conduct a VitalSigns Operational Effectiveness Assessment to get a data-based view of alliance operations and see both cause and effect
• Consider if one of the partners has corporate (portfolio) interests that diverge from the intent of the alliance and cause it to be deprioritized
• There may be operational issues at play. For example, the partners may not have developed core alliance processes, such as joint legal, medical, and regulatory review and are still working their independent processes in parallel, which creates delay
• Interview key stakeholders. Start by thinking about the metrics that matter to them relative to corporate strategy and goals. Understand their current priorities and personal motivations, to the extent you can
• Zoom out – Consider if changes in the market, science, or regulatory environment have made the core value proposition of the alliance less desirable

Take the analysis and develop a hypothesis about the causes of the underperformance signals and build a corrective action plan.

Deliver a Possible Fix

Taking corrective action is exercising stewardship of the alliance, it is not taking blame for the current situation. Assemble a joint team to agree to and implement an action plan. The specifics of the cause diagnosis determine who is on the team. For example, if the cause relates to the financial terms of the agreement, you do not need your governance subcommittee chairs involved. But you need your CFO, even if they have no role in alliance governance. Again, the levers to engage are different depending on the signals and causes you have identified. Most likely, they involve some degree of strategic reframing, financial rebalancing, and/or operational fixes.

• Strategic reframing – Reset ambition and goals to match a new reality. For example, narrow patient populations rather than pursuing a broad indication; reorder the development of future indications
• Financial rebalancing – Adjust cost-sharing, milestones, and/or territories when the originally intended incentive balance no longer exists; couple short-term concessions with shared longer-term upsides; rebalance the economic model through contingent earn-outs, options, and stepped-down royalites
• Operational fixes – The effectiveness of team operations is directly related to the speed with which deliverables are produced, decisions made, and milestones are achieved. Every joint alliance team needs to be a highly performing collaborative team, yet based on our research, most are not. The team leaders – typically cochairs of governance committees – often do not see their role as working together to build that high-performing team. We see a significant increase in the value captured by alliances whose leaders are joint team builders.

Taking Action

In the high-stakes world of drug discovery, development, and commercialization, alliances are not the third leg of the strategic build, buy, ally stool – they are core. Accordingly, alliance leaders must actively seek out underperformance, diagnose root causes, reengage stakeholders, optimize governance, and renegotiate terms.

Corrective action is stewardship on the journey toward innovation and shared success. By embedding agility into alliance leadership biopharma companies can protect value, accelerate therapies, and strengthen their ability to partner effectively in an era of constrained resources and high expectations.

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