souseikai global clinical research center

For Bio-ventures

For small and mid-size bio-venture companies, especially those that are start-ups, 1) finding co-development partners, or 2) licensing out their new drug candidate compounds to pharmaceutical companies, are both effective ways to sustain their business models.

In recent years, as an ideal and promising destination for finding a co-development partner or licensing out, Japan has received considerable attention from such bio-venture firms. One of the reasons behind this boom in popularity in Japan among foreign bio-ventures is its huge pharmaceutical market. The Japanese pharmaceutical market is the 2nd largest in the world, and market stability is expected to continue as the Japanese aging population continues to increase and the number of patients in most therapeutic areas also is steadily increasing (Chart 1).
Changes in total number of patient by classification of diseases(2011 to 2014)

According to the latest ranking of the world’s top 100 Pharma companies by drug sales, 23 Japanese pharmaceutical companies are listed for 2016 (Chart 2).

Chart2: Top 100 Pharmaceutical Companies in The World (2016)

When it comes to the pipelines of Japanese major pharmaceutical companies, because finding candidate compounds for new drugs and developing them faster than other rival companies are keys to successful development in an ever-increasing competitive industry, many Japanese Pharma companies have positioned themselves in the direction of relying more on drug discovery companies and licensing-in their compounds. In fact, about half of the pipelines owned by the top 10 Japanese R&D pharmaceutical companies originated from other companies (Chart 3).

Chart3: Breakdown of Top 10 Japanese R&D Pharma's Pipelines by their Origins in 2009

If we closely look at the types of companies whose biopharmaceutical candidate compounds were licensed-out to Japanese Pharma companies and successfully approved in Japan between 1991 and 2012, it is clear that foreign bio-ventures have been playing a central role in biopharmaceutical development in Japan (Chart 4).

Chart4: Types of Companies whose Licensed-out Candidate Compounds were Approved as Biopharmaceutical in Japan  (1991-2012)

It is strategically important to know at which stage Japanese pharmaceutical companies actually licensed-in compounds in the past.

Chart 5 illustrates in which development phases Japanese Major Pharma and Global Mega Pharma licensed-in compounds between 2008 and 2014. Compared to Global Mega Pharma companies, Japanese Major Pharma tended to license-in compounds, in the late phases of development (28% vs 51%). Given the fact that the early phase pipeline bears higher risks of development failure, Japanese Major Pharma are more sensitive to the licensing-in practice at early stages of drug development than Global Mega Pharma.

Chart5: Comprison of Development Phase of Licesing-in by Japanese Major Pharma and Global Mega Pharma (2008-2014)

The next key factor that foreign bio-ventures may want to know is if distinctions of candidate compounds have an impact on the possible timing when Japanese pharmaceutical companies consider licensing-in compounds (Chart 6). In the case where competing compounds that have similar MOAs are under development in late phases by other companies, or where the compound is expected to decrease in severity and frequency of side effects when compared with existing drugs, more than 50% of Japanese pharmaceutical companies answered that completion of clinical POC is a prerequisite for considering licensing-in a compound. If we combine the percentages of data for the categories of “At least at Clinical Stage” with those of “Completion of clinical POC”, 50% can be reached in additional 4 examples of compounds (B, C, D, & E), suggesting that for bio-venture companies, having early phase clinical data (i.e., from Phase 1 to POC) will certainly increase the chances of successful licensing-out practices.

Chart6: Characteristics of Candidate Compunds and Possible Timing when Japanese Pharmaceutical Companies Consider Licesing In (N=37)

  1. Has a high novelty level, and no competing compounds found
  2. Increase the clinical usage of existing drugs (incl. prodrugs) by drug delivery system
  3. Targets a rare disease with a low treatment satisfaction level
  4. Expected to improve the convenience of administration methods that are considered problematic with existing drugs
  5. Targets a common disease with a huge market and the treatment satisfaction level is high
  6. Has competing compounds that have similar MOAs under development in late phases by other companies
  7. Expected to decrease severity and frequency of side effects of existing drugs

What SOUSEIKAI Can Offer to Increase Licensing-out Opportunities

  • Quality Early Phase Japanese Data (from Phase 1 to POC), which is the most convincing evidence for Japanese pharmaceutical companies;
  • Simultaneous Asian/Caucasian Data Collection within one protocol, which enables separate licensing-out opportunities while keeping the trial conduction fee at a minimum.

If you need more information or have any inquiries, please Contact Us.