Alliance Management Expertise, Partnering Frameworks and Tools, Collaborative Leadership

The Making of a True Collaboration
1. Partnering Guide / June 6th, 2020     A+ | a-
This is Part One of a three-part series about an exemplary research collaboration between global biopharmaceutical giant AbbVie and BioArctic, a research-intensive Swedish biopharmaceutical company to develop antibodies (immunotherapy) based on promising science discovered by BioArctic that could stop progression of the debilitating Parkinson’s disease (PD). The partners wish to share their experiences so that both their companies and others may benefit. The Rhythm of Business was engaged after their collaboration had achieved its primary objective to help the partners examine their alliance, identify repeatable practices, and tell their story.
 
At the September 2014 Parkinson’s Congress in Stockholm, Sweden, Gunilla Osswald, CEO of BioArctic approached the AbbVie booth and asked whom she should talk with about her company’s Parkinson’s Disease program. She was directed to AbbVie’s Europe-based search and evaluation team member who told her that BioArctic’s program was too early for AbbVie to consider. “Come back when you’ve humanized the antibody,” he said.

Fifteen months later, having successfully humanized the antibody, Osswald was meeting with AbbVie’s search and evaluation lead for neuroscience at a partnering conference. Their meeting was supposed to be a brief 20 minutes. Layer-by-layer it became 90 minutes of scientific discovery. It was the first step in establishing a critical trust building foundation for what would become a successful collaboration on promising science to treat a disease with no known cure.

This partnership is as ordinary as it is exemplary. The partners did not implement breakthrough new practices. Rather, they consistently implemented proven alliance practices, adapting and innovating them for their specific context. What is exemplary is the discipline with which the practices were executed throughout the lifecycle of the alliance because they just made good business sense. Also unusual is the depth of the collaboration that developed because of the partners’ intense focus on the goal and practicing behaviors that build trust and respect, enabling the kind of transparency and honesty that innovatively addresses problems and challenges without egos or politics impeding progress. 

Design Before Deal

The period of time when partners are considering if they should work together is often referred to as deal-making. A more productive and value-creating approach to this “courtship” is to use it to design the collaboration with the desired outcome in mind. When you believe you have both the right partner and the right plan, the business elements of the partnership fall into place. Good alliances rest on strategic, operational, and cultural “fit” between the partners. AbbVie and BioArctic are very different companies, with different strategies, business models, and cultures. They found common ground in the science and in the patient-centric approach each of them had that drove the motivation to work together.

After the initial meeting—which was very much focused on the science— AbbVie’s search and evaluation lead, who is a scientist, realized there was something there that he could bring forward for a potential alliance. He “rounded up a few key stakeholders, flying them to Germany—in the height of the holiday season. BioArctic also brought their key people.” Other AbbVie staff who would have important roles in a potential collaboration were included via video conference. One of the BioArctic participants described it as “unlike any other big pharma meeting they had because all the key people were involved from the beginning.” From this first big face-to-face meeting, the decision makers and the key people who would be responsible for the work of the collaboration were engaged, creating an agile platform for designing the future alliance.

The focus was on science at this meeting, just like the prior encounter between AbbVie’s search and evaluation lead and Osswald. “The scientific exchange was very open. The stage of the asset was clear. We understood how they were approaching the open questions and it all made sense. Together we outlined the gaps in the program and identified how they could be addressed. There was a fair degree of alignment we could move forward.” As AbbVie was assessing the science, BioArctic was sizing up AbbVie, as there were other suitors for the asset. “You should select the partner you think you can work with very well. Someone who will take your baby and make it work in the long run. They were committed to the Parkinson’s patient and you could tell they saw us as very skilled in science and drug development.”

Importantly, the open scientific exchange helped the partners get to know each other as people. The chemistry between them was obvious to all and partially manifest in their ability to listen to each other and understand what the other needed. According to a key BioArctic team member, “We felt they really wanted the asset. That’s what we would want. A champion that will guide the project, especially in terms of their internal governance process. When we started to talk with the AbbVie team, it was their great [scientific] knowledge and ability to listen that helped build trust.”

Creating Value for Patients and Partners

The meetings between the teams continued into 2016. They were actually working sessions, focused on building out the operating framework and workplan for what was now being referred to as “our program.” The initial plan BioArctic presented was very streamlined. AbbVie had a vision and wanted a more ambitious plan. Time to patients with clinical trials and ultimately to market is essential in a competitive environment such as PD, so having a plan that would aggressively address the rate-limiting risks was essential. According to BioArctic, “We had a lot of iterations and the plan grew. It impressed us that they saw the scope of the plan could be expanded. We listened to them and accommodated their wishes. We showed knowledge and flexibility. That we could answer all of their questions, that impressed them.”

As the plan was being developed, the functional leaders were working together designing the four specific “work packages” to achieve the overall plan. In many situations, this level of detail would have been left until after the diligence and agreement was complete and the alliance kicked off. There would often be new people involved at that point, requiring both knowledge transfer and building trust with the new members of the team. By conducting planning at the work package level with the people who would be responsible for executing them before the specific alliance agreement was negotiated, the companies achieved three important value-creating outcomes:
  1. They continued to build relationship and trust between the people who would be responsible for the work
  2. They saved time that would have been lost in getting new functional teams up to speed had the design of the operating framework been left to after the agreement
  3. Both parties had a better understanding of the time and resources required to complete the research
The third outcome meant that once the plan was complete and they moved to the finances behind the alliance, “Contracting and negotiations went smoothly.” (Note that in the partners’ view, negotiations only began after the alliance operating framework was developed.) In fact, getting to the economic model that would underpin the alliance was so straight forward that it was negotiated over the phone.

According to AbbVie’s business development lead who did the negotiating, “I did some work on the valuation and sent them a term sheet. They changed one number and made two other relatively minor edits. We negotiated the term sheet in about an hour over the phone. The next step was to draft the definitive agreement. We provided them with a draft and they came back with a relatively light markup. It took two sessions on the phone with me, Gunilla (BioArctic CEO Osswald) and our respective attorneys. It was maybe four hours in total. We never met in person.”

The agreement was signed in September 2016, roughly nine months after the first big meeting in Germany. While that may not seem extraordinarily fast, when one considers that there were detailed workplans and established relationships in place, they were far ahead of where many alliances are in the same period of time. Certainly, there are lessons here for our coronavirus limited world!

The Alliance Kickoff Matters

Every alliance professional knows the adage, “Start it right or start it again in the midst of conflict and significant mistrust.” The work during the alliance design, due diligence, and negotiating process got this alliance off to a good start. Indeed, the partners acted as if they were in an alliance from that first face-to-face meeting in Germany. Contrast this with the typical due diligence period where the companies are posturing to gain the best financial deal and you begin to understand why this alliance is exemplary.

The kickoff was a formal two-day session that brought together the full teams that would be working on the work packages. There were a number of new people, especially from AbbVie who were introduced to the collaboration at this point, so it was important to have the type of meeting that would help the teams achieve the same level of collaboration that had brought the partners to this stage.

Perhaps the most important work at a kickoff is to ensure everyone is aligned on the North Star for the alliance. The North Star is a representation of the value the alliance will bring to the patients and the partners. It guides decision making and resource allocation. It provides a rallying point when the pressures of organizational life distract. It is sometimes referred to as a mission statement. Regardless of the label, the importance cannot be overstated.

As the AbbVie project leader said, “The mission statement we agreed to at the kickoff of the collaboration captured the spirit of that we were trying to achieve. At every governance meeting thereafter we would remind everyone of it. I think this was one of the key reasons for our successful partnership. Every alliance should have a mutually agreed mission statement.”

Up Next: Executing Collaboratively – How AbbVie and BioArctic made their alliance work. Watch for our next post in a few weeks.
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