In recent months, major drug developers such as Genentech and Schering-Plough, who were previously partnering targets, are now going through the process of mergers (with Roche, and Merck, respectively). This means it is likely that there will be a continued gradual decrease in the number of potential partners looking to acquire co-ownership of new drugs going forward.

As big drugmakers continue to merge, the consolidated portfolios will also change. At first glance it would seem like the mergers and acquisitions would allow the combined company to expand its portfolio. However, these mergers often result in management trimming off ‘excess’ to increase focus on the most profitable areas. Therefore, not only is the number of companies decreasing, but the number of disease indications being pursued by these companies is also likely to continue to decrease.

Consequently, as small companies have ever decreasing choices, major drug developers have more options from which to choose when selecting a partner. It is no longer enough for a start-up biotech to be first-in-class. Instead, it is more important than ever for biotechs to see their own programs from the perspective of major drug developers and create fully enabled programs that are attractive to potential partners in multiple ways.