Putting the “Co” in Development and Promotion

While collaborations between emerging biotechnology companies and pharma/biopharma companies are not new, these deals dramatically have increased in sheer number and deal value. Perhaps the most important recent trend to note is a structural one—a trend away from the conventional royalty model toward 50/50 cost and profit sharing collaborations. Last year, even small, emerging biotech companies successfully negotiated balanced deals with 50/50 economics. In spite of the resource constraints small biotech companies face, and the inherent complexity in negotiating 50/50 collaborations, these partnering deals are on the rise.