We’re now in the midst of what many have called “The Decade of the Ecosystem”. Partnerships look set to become the most important revenue generation channel – and for many, they already are. Forging strong partnership ecosystems is now a critical priority for life science startups, faced with a tough fundraising climate, and the “triple squeeze” of economic pressure, talent scarcity and disrupted supply.
But before startups can reap the benefits of belonging to these ecosystems, they need to find a way into them, or even build them. The good news is that the same AI capabilities that enable deep competitive intelligence can just as easily be used to identify and pursue high value partnerships. In other words, AI systems like Similari are as good at finding friends, as they are at keeping tabs on foes. For life sciences startups, finding opportunities for partnership or licensing agreements is every bit as critical as knowing what a competitor is doing.
Here, we’re taking a look at exactly why it is so important, especially in the current moment. Then, we’ll outline a use case for startups seeking to strengthen their partnership networks through AI-enabled discovery.
What’s driving the shift towards partnerships – and why startups should embrace the change
At this year’s J.P Morgan Healthcare Conference, partnerships eclipsed the usual focus on fundraising. Digital health funding in particular is now 48% lower than the 2021 peak. It’s clear that the pandemic-era investment boom is over. For startups, that has spurred a renewed interest in optimizing costs and revising go-to-market strategies.
It’s also driving partnership ecosystems into the spotlight. For a wide range of reasons, this is actually good news.
Partnerships can remove roadblocks to distribution and sales
Partnerships with established medical device distributors and sales organizations can give startups access to larger customer bases and sales channels. The partnership between Pfizer and BioNTech is a good example of a partnership that amplifies market reach and distribution. In 2020 they announced a partnership to develop, manufacture, and distribute BioNTech’s COVID-19 vaccine. The partnership enabled BioNTech to scale up production quickly, and Pfizer’s distribution capabilities helped to make the vaccine widely available.
Clearing regulatory and compliance hurdles through alliances
Life science startups may partner with companies who know how to navigate complex regulatory environments. They can use these partnerships to achieve compliance and accelerate approvals. This is particularly important for biotech and cannabis startups, who frequently encounter obstacles to FDA approval. Medical device startups, too, can benefit from partnering with more established firms to achieve compliance, and to build recognition and trust.
Cross-pollinating technical expertise in life sciences partnerships
Partnerships with large companies in the medical device industry can provide startups with access to technical expertise in engineering, manufacturing, and quality control. And sometimes, the flow of expertise is mutual, like GRAIL’s 2021 partnership with GlaxoSmithKline. The partnership combines GRAIL’s expertise in early cancer detection with GSK’s expertise in diagnostics and oncology to develop new products.
“Build-to-buy” partnerships balance the interests of startups and Big Pharma partners
These startups may also enter build-to-buy partnerships with larger companies. These are partnerships to co-develop and co-commercialize a medical device. The larger company provides funding and resources for the development of the device, while the smaller medical device company provides expertise and intellectual property. In a build-to-buy partnership, the larger company typically has the option to buy the smaller company or its assets once the device is developed and commercialized.
The startup partnerships dilemma: there’s no time (and no money) for traditional partner discovery
So how should startups proceed with building robust partnerships that coalesce into thriving ecosystems? This is where it gets complicated.
Traditionally, partnership management is a complex business function, with dedicated personnel who seek out and engage prospective partners. Partnerships teams use trade fairs, industry networking events and online partner networks to meet and evaluate prospects. Behind the scenes, they have to invest extensive time and resources in researching each prospect’s business model, reputation and customer base to determine whether they fit their Ideal Partner Profile (IPP).
Accelerating partnership discovery with a little help from AI
Much of that workflow can (and should) be automated. And while the world of Partner Relationship Management (PRM) is forging ahead with digital transformation, less attention is paid to the initial partner discovery phase, where AI can make a huge impact. Instead of manually searching across a wide range of networking platforms, partner managers can repurpose AI-powered intelligence tools to spot viable partners in any industry. In many cases, they can even rely on the same metrics that R&D teams use to evaluate competitor performance: market reach, customer base and current innovation activities.
Using Similari, even cash-strapped early phase startups without a partnerships department can tap into a dynamic picture of their space and identify relevant, high quality partnership leads. A new biotech product that you could license, or an upcoming medtech company whose niche expertise could fill non-core competencies that you need – it’s all easily discoverable using Similari’s advanced analytics and proactive monitoring.
Book a demo to find out why so many life science startups are turning to Similari to help them hone in on partnership and licensing opportunities, and building ecosystems that will weather the storms just over the horizon.