Pfizer Inc's Polly Murphy on how creating a sustainable enterprise will allow them to make the biggest difference for patients,




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Video title: Pfizer Inc's Polly Murphy on how creating a sustainable enterprise will allow them to make the biggest difference for patients,
Released on: October 20, 2011. © PharmaTelevision Ltd
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In this episode of PharmaTelevision News Review, Fintan Walton talks to Polly Murphy, Vice President R&D Business Development or Pfizer Inc,
Changes in Pfizer's R&D innovation
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here at BioPharm America in Boston, in September 2011. On this show I have Polly A. Murphy, who is Vice President of Worldwide R&D and Business Development at Pfizer , welcome to the show.
Polly A. Murphy:
Thank you.
Fintan Walton:
So Polly, obviously Pfizer is one of the largest pharmaceutical companies in the world like a lot of other companies that are large at the moment in pharmaceutical sector it's going changes and one of the noticeable changes that's taking place is the reduction in the amount of research and development going on closure as it sound which for an example moving research scientists around, even jobs been lost or gotten, so tell us what's actually going on with Pfizer? What's this change all about?
Polly A. Murphy:
So Pfizer believes that the right thing to do is to create a sustainable enterprise, it doesn't do anybody any good to not have a sustainable enterprise and that's where we end up in these constant cut cycles, so what Pfizer believe is trying to do is to really create the right sized R&D relative to the rest of the company so that we can be sustainable long into the future and the way we are doing that is by focusing and you know the ability to focus is actually a gift, because it allows you to do the things that can make the biggest difference for patients, so we've focused down on the disease areas that we believe we can have the most impact in creating innovating medicines that are differentiated and are great benefit to the people who need them.
Fintan Walton:
So these changes mean that obviously that there is a greater dependence on external research outside Pfizer?
Polly A. Murphy:
So that's a component, I think what we're trying to do is focus so what we're seeing is it's critical that we have we are able to deliver medicines to people who need them in the area we believe we can have the most impact and we are really looking for areas where we believe we can create quite differentiated medicines that really solve problems that patients have and people have and so you know there were some needed cuts and some of those cuts are externalization particularly in some of the areas where we believe that we don't have any competitive advantage versus what someone on the outside could deliver and in those cases what working with outside party gives you is more flexibility in your business model as things ramp up or ramp down.
Fintan Walton:
So from a company out there a biotech company or specialty pharmaceutical company there is still a great interest in Pfizer I presume in setting up alliances?
Polly A. Murphy:
Yes, absolutely you know we remain very committed to alliances and we've actually you could argue doubled down in that since Mikael Dolsten came to lead R&D we've created a group that's called External R&D Innovation which is a group my group actually sits within business development but this is a group within R&D that is focused exclusively on searching and evaluating in the early stage space which at Pfizer what early stage means is through proof of concept demand so around that Phase IIA stage, so we have an entirely new group that's devoted just to finding alliances.
Fintan Walton:
Okay, so that's important because what people like to know also is how that works, so if I am a biotech company out there and I want to do something with deal with Pfizer, who do I approach, do I approach you, do I approach the head of research and development, what do I do?
Polly A. Murphy:
Well so one of the things they tell people is the great thing about Pfizer is it's big but it's small and all you have to do is to know one of us, so if you know one of us you know all of us and you know we have an opportunity we are looking at right now that came into the CFO see what argue that's a very strange place for something to come in through, but no matter how you get your opportunity in the Pfizer whether it's on our website or you can actually enter opportunities or its meeting me at a conference everybody knows who to go to and if it only goes to you know if it fits somewhere Pfizer doesn't know they will send it by boss Kristin Peck who heads BD and she knows it comes to me. So you know sometimes when I use to tell people be patient, because it might have to go through three people but I guarantee you we will get to somebody and we will respond.
Key therapy areas focused on by Pfizer
Fintan Walton:
Okay, so there are two parts I want to cover with you obviously there is the what's your actually looking for and then actually then the process by which you gonna actually ultimately end up with a deal, so with the first part you know what are you actually looking for? What sort of therapy areas you focusing on?
Polly A. Murphy:
So our five key focus areas right now are vaccines, immunology and inflammation, CV cardiovascular and metabolic disease, oncology and neuroscience there is certain specialities within that you can go to our website and find that and we also are still looking for a technology, so very interested in technology platforms, new modalities but our website has all those details.
Fintan Walton:
Okay and that's coming up now. So the other thing of course you know where do you actually go when you talk about technologies stem cells for an example therapy is an area that is novel new areas are you prepared to go into those areas, I know that in the past Pfizer's has looked to that?
Polly A. Murphy:
Well we actually have gone into some, we have our pain group in the UK and it was in Sandwich now it's moved to Cambridge that group also does regenerative medicines it's a small, yes basically a small play just to see you know what we can find and how it works so we are in regenerative medicines at this time.
Deal and Partnership strategy
Fintan Walton:
Right, what makes again in terms of your search and find what makes a good partner? What are you looking for obviously it's a technology, the science, the degree in which your drug is developed as obviously have a role of importance, but what else are you looking for from that organization?
Polly A. Murphy:
You know I think at the beginning what we are looking for is the clarity of what you want and a clarity of what you want from us, because the best partnerships come from clarity and then as the partnership goes on an open honest dialogue because something has changed I mean you do a deal you think it's gonna go one way it goes another and the ability to have an open dialogue and really talk about how can we still work together or change how we are doing it to make sure that this technology or product actually can help people and so you know we try to be a good partner and I think you know and sometimes the patience with us because sometimes we are little slower than I think a small company can be, but those things all go to a good partnership.
Fintan Walton:
Right, and it comes onto the into this partnership is there obviously in terms of trust, but also then you have the actual deal itself which is the other part of course and in the types of deals that you are doing are you now more flexible do you think in the types of deals that you do?
Polly A. Murphy:
Yes we are a lot more flexible, I think you know innovations come in a lot of ways and one of the ways is through business innovation and business model and deal in my word that's deal innovation and I think you can look to agreements certain relationships like our centres for therapeutic innovation, our relationship with Washington University where those are really unique in that we actually have given people outside of Pfizer who knows his academics access to the ground zero, so our chemical compound library are large molecule antibody library and said look if you can find something in here that we are not exploiting we'll actual share ownership of it with you and you know ownership of the knowledge of what it could do, which I is you know we are pretty out there in the industry in that and very proud of that.
Fintan Walton:
Right, so its knowledge sharing is really important I suppose?
Polly A. Murphy:
Yes it is, and I think our willingness to say things that used to be absolutely you would never do it are now not only on the table but we are actually entering into agreements where we give people access to our libraries?
Fintan Walton:
Now one of the things that pharmaceutical companies are doing I know that Pfizer does it as well is you are looking for more of a shared risk model, so one way of doing sharing risk is obviously the other party pays and makes contribution, but also there is ways in which you can mitigate risk by going into option based deals, so could you give us some sort of feel for what type of deals you are doing in that particular area?
Polly A. Murphy:
You know again in the early stage space.
Fintan Walton:
Yes particularly in that early stage space.
Polly A. Murphy:
so I am gonna speak to that world you know it's really interesting as we gonna have this dialogue about you know options modeling and using some of the even the Wall Street models which is fascinating to make I am not a finance person and I have really enjoyed kind of thinking about that, it tends to be in the early stage values are kind of more based on just you know the comps and the comparables in the market, but we have that whole conversation about we do wanna actual get in, what is the value of that option and the way that you have an option in the market, but you know we do classic option deals you know like we'll pay for your FT's we will give you some upfront we'll pay your FT's we have an option to license later you know we also are doing a lot more what we call a feasibility agreements so unproven technology may be with an option at the end, but you know usually with an option at the end to take the full license and that's the way for us to you know help you prove your technology so advantage to you and then give us access toward at the end without having to pay the money upfront before its proven it you know in the model we use to work.
Relationship with Pfizer Ventures
Fintan Walton:
And the other component to do a lot of deals is the is an equity component and you Pfizer has, Pfizer Ventures you've got Barbara Dalton there at who does that, how important is Barbara and Pfizer Ventures in relation to you doing deals these days?
Polly A. Murphy:
Well we work back in forth that's interesting, because sometimes we find things and we say you know what that's really probably a venture deal and she will find things and just say you know not really what we were gonna invest in but you should talk to these scientist the way it works with Pfizer is if we are doing a deal that has venture capital investment Barbara would not be the decision maker in that, but she is our advisor. So she is the one who works with us on you know what terms do we want et cetera and she reviews, but if I need like if I wanna a deal that has venture has equity investment I have to go to the CFO and ask for it, because Barbara's fund wouldn't do that because she has her own fund goals and so she shouldn't have to take in the things that I want to do for.
Fintan Walton:
Yes, it have to be aligned her own objective?
Polly A. Murphy:
That's correct, so if I am looking for a equity investment that's part of the deal program the deal I put forward.
Fintan Walton:
So you've different options for you to you can either get from Barbara or you can get from CFO?
Polly A. Murphy:
That's right and sometimes she is interested and we are interested in which case we work together and Ablexis is a really good example of that where you know Margie, I think Margie found it she bought Barbara and Barbara made the investment and actually helped build the company, so we it kind of three ways.
Polly's role in deal making process
Fintan Walton:
Right. So in the end then if going back to if I was a biotech company trying to do a deal with Pfizer let's say I've got myself engaged in discussions with scientists from within Pfizer saying putting the thumbs up and saying this is a great deal are you involved to that stage, Polly you when do you actually get involved in the actual process so you the negotiator or where what's your role?
Polly A. Murphy:
So this, the group I mentioned earlier the external R&D Innovation they do search and evolution and it depends that we have the way both of our groups are set up as we're aligned to given units, so at single points of contact from external R&D innovation and business developed so they work closely together, usually for the early stage discussions then BD wouldn't be involved, but once you sort of figure out you wanna deal you bring BD in external R&D innovation runs the diligence and then we do the negotiations and once we are done with the you know for you actually to enter into an agreement they kind of run the scientific part of it and we run the business part of it, so any of the contractual obligations that kind of stuff we do.
Fintan Walton:
Sure so you are close, are your closely aligned to the finance department may be how close?
Polly A. Murphy:
To business development so at Pfizer Kristin Peck, so Kristin Peck is not in the CFO group she reports directly to Ian Read, so she has worldwide business development and innovation.
Polly's perspective: Biotech financing landscape and new challenges ahead
Fintan Walton:
Sure okay. And then finally we have a the industry is going through changes it's not just the big pharma companies like Pfizer that are changing obviously the equity financing of biotech companies, yes there are some good companies still getting financing but that landscape is changing. So from your perspective and from your view of looking out there and talking to companies to do deals where do you think that we are ever likely to return to a time when there are a lot more biotech companies taking products forward or we are now in a new landscape which brings new challenges?
Polly A. Murphy:
I suspect it's the second but I hope it's the first, but I think the good news is there is a lot more collaboration. Yes I think there was a time where big pharma was looked at as a money bag, right. We showed up they wanted money we you know and now we are very clear you know we want to be your partner, we want to put services and then get credit for that you know it's very much of a collaborative world and so I have a hope that even if you know it ends up being that there may be a fewer and maybe that's good, maybe there were too many you know if you look basically R&D has always spent more than the revenue coming back and that's obviously not a sustainable model and that's part of one of Pfizer's big focus is sustainable model, so you know I hope that creativity can get us to a better place.
Fintan Walton:
Sure, so the business model is changing for everybody, it's changing for pharma.
Polly A. Murphy:
Yes it's changing for everybody.
Fintan Walton:
It's changing and also venture capital they have changed the way in which they have to invest in companies, so we'll watch that with greater interest. Polly, thank you very much indeed for coming on the show.
Polly A. Murphy:
Thank you so much for having me.
Fintan Walton
Dr Fintan Walton is the Founder and CEO of PharmaVentures . After completing his doctoral research on the genetics of cell proliferation at the University of Michigan(US)and Trinity College (Dublin, Ireland), Dr Walton gained broad commercial experience in biotechnology in management positions at Bass and Celltech plc (1982-1992).
Polly A Murphy
Vice President
Polly A. Murphy presently serves as Vice President, R&D Business Development of Pfizer Inc. Polly A. Murphy leads the Worldwide Business Development team that supports Pfizer 's R&D organization. This team is a global group of professionals focused on licensing and alliance management. She also serves on the Board of Directors for The Pfizer Incubator. Prior to Pfizer, she was Sr. Vice President, Business and Scientific Services at The Scripps Research Institute. In this role she led organization-wide business development and technology commercialization functions and was responsible for operation of the scientific support functions at the La Jolla campus. Before joining Scripps, Polly was VP, Office of Technology Management at the Salk Institute where she was responsible for protecting and commercializing Salk technologies. Previously she was in Business Development at Aurora Biosciences after holding several positions for Dupont Pharmaceuticals the last being vice president for portfolio planning and valuation. Of note, she headed the U.S. marketing team that launched DuPont Pharma's HIV drug Sustiva. Prior to Dupont, she worked for Nabi Biopharmaceuticals where she was director of business development. She began her career at Hoffman-LaRoche as a post-doc in the experimental pathology group followed by positions in sales and marketing. Polly holds Doctor of Veterinary Medicine and Ph.D. in Veterinary Pathology degrees from Iowa State University and an M.B.A. from Nova Southeastern University.
PharmaVentures
PharmaVentures is a corporate finance and transactions advisory firm that has served hundreds of clients worldwide in relation to their strategic deal making in the pharmaceutical, life science and healthcare sectors. Our key offerings include: Transactions / deal negotiations; Product / technology valuations; Deal term advice; Due diligence & expert reports; Strategy formulation; Alliance management; and Expert opinion for litigation/arbitration cases. PharmaVentures provides the global expertise to ensure our clients generate the highest possible return on investment from all their deal making activities. We have experience of all therapeutic areas and can offer advice on both product and technology commercialisation.
Pfizer Inc
Pfizer Inc incorporated on June 2, 1942, is a research-based, global biopharmaceutical company. The Company operates in two segments: Biopharmaceutical and Diversified. Biopharmaceutical includes the Primary Care, Specialty Care, Established Products, Emerging Markets and Oncology customer-focused units, which includes products that prevent and treat cardiovascular and metabolic diseases, central nervous system disorders, arthritis and pain, respiratory diseases, urogenital conditions, cancer, eye disease and endocrine disorders, among others. Diversified includes Animal Health products; Consumer Healthcare products, such as pain management therapies, cough/ cold / allergy remedies, dietary supplements, hemorrhoidal care and other personal care items; Nutrition products such as infant and toddler formula products, and Capsugel. On January 31, 2011, it acquired approximately 92.5% of King's common stock. In August 2011, the Company sold its Capsugel business to an affiliate of Kohlberg Kravis Roberts & Co. L.P.