Dr. Robert Malone

Bridging the Valley of Death

 

ABSTRACT: In 2000, the National Research Council published a report on weather satellites and prediction which famously referred to "Crossing the Valley of Death", using the phrase to describe the fundamental challenges involved in transitioning from research and development discoveries to commercial products and processes. The report emphasized that operational implementation is frequently difficult, and if done improperly, transitions from discovery to product implementation often result in "skeletons in Death Valley." In crossing the valley, new technologies and product candidates must survive two types of challenges; 1) can the candidate meet performance requirements, and 2) will it survive being “tossed over the fence” which separates the culture, environment and capital sources supporting discovery research from those involved in product development. 

The Death Valley metaphor has been embraced by many as a way to convey this perilous journey from promising technology to marketed product.  Retired Major General Dr. Phillip Russell invoked the phrase in his 2005 US Senate testimony in support of project Bioshield as a way to summarize what he saw as the “eight critical elements that are major determinants of success or failure” in obtaining medical countermeasures essential to national security. While reflecting the perspective of a government administrator, Dr. Russell’s eight points are familiar to any biopharma venture capital firm or major pharmaceutical company involved in due diligence and planning prior to an investment in new product development:

• A credible threat determination and threat analysis (clear unmet medical need)

• A defined deployment and utilization policy for the product (target product profile)

• Government-wide agreement on the requirement (internal stakeholder consensus)

• A mature science base demonstrating proof of principal and ability to manufacture

  (POP, POC and feasibility)

• Funds and funding mechanism for early and mid-stage industrial development

  (adequate capitalization)

• Sufficient acquisition funds (obligation authority) to provide the incentive for industry

  (existence of a well defined market)

• Consultation and support for the manufacturer from the acquisition agency and the FDA

   to assist in meeting regulatory requirements (reasonable regulatory pathway to licensure)

• Ability to indemnify the manufacturer (manageable safety/liability risk)

 

In 2009, the biopharmaceutical industry confronts the best of times and the worst of times.  New knowledge, processes, tools, technologies and capacity create unprecedented opportunities to address unmet needs.  Large pharmaceutical company customers are looking to smaller innovative firms to help fill empty product pipelines.  Yet depleted and disenchanted venture capital sources have lost their enthusiasm for the substantial, high risk investments which our current business models and practices require.  The financial sages of our industry suggest that the restructuring of global capital markets will require fundamental changes in how we finance our operations.  During the next decade, fulfilling the promise of biotechnology will require new business practices which reduce capital demands and de-risk the valley of death. 

 

Current trends suggest that these requisite new business practices are likely to include the following characteristics:

 

1) Outsourcing (virtual pharma business model)

2) Rigorous project planning and management practices which couple technical milestones to

    disbursement of project funds

3) Fewer startups, with launches requiring a more advanced “technology readiness level”

4) Increased reliance on financing new technology development via non-dilutive capital,

    partnering, and profit from existing operations

5) Earlier stage emphasis on viability of product development pathway by non-dilutive capital

    sources, and increased insistence on meeting product deliverables (government, NGO)

6) Discovery and pre-clinical stage biopharmaceutical product development activities must be

    aligned with the regulatory, QA, manufacturing, and clinical safety/efficacy demands of

    advanced development.  The bulk of the financial risk in biopharmaceuticals is incurred

    during advanced development, and additional steps to de-risk this investment must be

    integrated throughout the entire product development process.

 

In the next decade, success in bridging the valley of death will take more than just capital.  Tomorrow’s successful biopharmaceutical companies will need to adopt leaner and more tightly controlled business practices, while also developing more effective ways of integrating and aligning the early stage product development “scientific culture” with the QA and regulatory-driven culture and practices required for advanced product development.

 

BIO: Robert Malone, M.D., M.S.  Dr. Malone has extensive research and development experience in the areas of clinical trials, vaccines, gene therapy, biodefense, and immunology. He has over twenty years of management and leadership experience in academia, pharmaceuticals and biotechnology. His NGO, HHS, NIH, and DoD contract and grant knowledge is extensive, and he has helped many groups and companies to capture and manage multi-million dollar awards with these sponsors. He is currently Associate Professor of Biotechnology at Kennesaw University, Editor in Chief at Journal of Immune Based Therapies and Vaccines, Medical Director at Accelovance, and is one of the original inventors of "DNA vaccinations".