Open Innovation at $25 Billion AstraZeneca

May 18, 2016

How Open Innovation Got Started at AstraZeneca

Scott Wilkins: It really started back in 2010. We were looking to build our pipeline up, to replenish the [products on the market] that were coming off patents.

There was a gap there, and we needed a step change in the way we did R&D. New leadership was brought in, and one of the top things that I heard from the leaders was that we’re not working together enough in R&D. The therapeutic areas aren’t working together, and there are too many silos. We have 10,000 people in R&D, a large R&D budget. How can we do things differently?

One of the things that I saw was around crowdsourcing. You [could] get someone in the cardiovascular therapeutic area that’s a chemist, and someone in oncology, and they can help each out with their problems and their challenges. The issues are that they’re in different therapeutic areas, so they’re not necessarily in the same circle. They might be spread out geographically, too. One could be in Sweden, the other could be in the UK or the US. How do we get these people together? We piloted some tools and we decided to go with one called iSolve. That was our internally-branded internal collaboration tool [built in partnership with InnoCentive, a crowdsourcing platform.] That was around connecting the 10,000 people that we had globally.

Oncology was interested in getting some of their problems out to the different therapeutic areas. When we did the pilot with oncology, and so it was really oncology problems that we put out there. …We would send them out to pretty much everyone in R&D. We probably had 8,000 people out of the 10,000 people that were connected to the iSolve platform. Oncology problems were the first ones.

We started with internal innovation and then we thought, “How do we do open innovation [externally]?” We build up confidence, ran a bunch of events, solved some significant R&D problems internally, and then I think that really set the stage for us to [create] an open innovation business case that was supported by the R&D leadership team.

That launched in 2014, and has been going well. The team actually won a CEO award. It’s a company of 60,000 people, and there’s a handful of these awards to go out each year, and the open innovation team was one of them.

Sourcing Problems to Work on

We had support of the R&D leadership team, and so we had representatives for each of the [therapeutic] areas, and they would go out [and] would look for challenge owners.

[Challenge owners] are people with problems that would raise their hand and say, “I need some help,” and they would post it out. The reward for them is, they get their problem solved. They would be able to make a decision from there, to either advance [a project or] to stop a project, because you have new information that the project’s probably not going to make it into a drug, or make it to the next phase.

We launched iSolve, and the internal platform in 2012. It was in 2014 that we launched the open innovation site. It was in development for about a year… We wanted to be careful, and do it the right way. It’s getting the right problems out there, the ones that we can’t solve internally. The other thing is around IP transfer and legal implications [and] compliance.

There’s just a lot of groups we had to work with, and I guess my advice is involve these folks early, and really try to partner with them, and have a balanced, risk-versus-reward discussion. I think that helped us move the conversation forward, rather than just focusing on risk, around the risk of potentially IP issues.

You can have that conversation, but also balance that with the benefits. The benefits are that we’ve got 10,000 scientists, and we’ve got hundreds of companies, and academic institutions, and government institutions that we partner with. But there’s several billion people in the world, and those answers to our problems could be beyond our current scope right now, with the partners that we have and the folks in our R&D facility.

Getting the Right People Behind It

We had examples of where other companies were doing [open innovation externally.] I think the key here was that we had the top scientific leadership on board with this, including the heads of R&D. In our process, it’s the person in charge of a therapeutic area that reports into either the head of research, or the head of development. They’re the ones who sign off on any challenge that goes outside.

The next thing, after we got scientific leadership and senior scientists on board, was getting legal on board. Scientists know a lot about the IP, and they know what risks are there, so it was about explaining to legal that, “OK, we have the head of the therapeutic area, and the senior scientists who are comfortable with putting this problem out there.”It’s having that discussion, then if something came up with compliance, we would have our colleagues in legal talk to the people in compliance on why this should go forward, and what the benefits are to the company. It’s kind of getting your ducks in a row, so to speak, which is helpful for us.

Rob Albert: Really, the only other guys who were opening the door at that time [was Eli] Lilly. If you look back, actually, the founder of InnoCentive came from Lilly, and he’s back at Lilly now. But we, AstraZeneca and Lilly, are really the pioneers in opening up this kind of innovation, and open collaboration.

Success Stories

One of the examples that Scott and I generally like to share is that we were asked a question from the manufacturing group in the UK. They were trying to manufacture a clinical [drug] candidate, and they needed some help. They weren’t getting any traction through the normal means, so we posted the challenge on iSolve, and one of the scientists from our Waltham [Massachusetts] area actually logged on and said, “I actually did this kind of work as a grad student. This is what you need to do. You can take out these two steps, you can eliminate this expensive catalyst. By the way, you’re going to cut down on multiple gallons of severely toxic waste.” That had the potential to save millions of dollars. It was a huge success. He was actually recognized at the end of the year, at dinner, from what we call iMed, which is our innovative medicines group. That kind of success breeds success.

[Another] of the things that I like to talk about is the clinical compounding. …We have compounds [that] went [into clinical trials], and failed for one reason or another. Now, it could be failed for efficacy for their intended target, it could be they failed for safety margins.

What we’ve decided to do, which is a complete about-face for pharma, is instead of just allowing those compounds to sit on a shelf and serve no purpose, we said [to outside parties], “Come take our compounds, repurpose them, and tell us what you want to use them for.” Out of that are going to be delivered two new medical entities for cancer treatment, which is awesome, because that’s two compounds that were literally put on the shelf, and now they’re going to be delivered to change people’s lives. It’s really, really cool stuff.

Some people suggest that open innovation and crowdsourcing tools are really only useful for incremental problems and solutions, and not for breakthrough or disruptive ideas. One of the paradigms that we’re trying to challenge is the view that this can only be helpful in certain situations. My own take on that is, that can be true if you don’t have an overarching program with an overarching goal.

We’re not just paying lip service to open innovation. We’re actively promoting our open innovation. We are partnering with people like the Medical Research Council in Cambridge in England, and we’re partnering with tons and tons of [other] academic institutions. We’re partnering with other pharma and other biopharma [companies], so there’s a lot of collaboration that’s coming directly out of this open innovation platform.

I’m sure that you are all facing budget constraints, and budget cuts, and travel restrictions, and [the need to] do more with less. Open innovation is one way to do more with less. This is one way to take advantage of expertise and best practices sharing that we all have in our own companies.

Best Incentives

With internal innovation, we tried [financial rewards] in the beginning. It just was that the recognition, when [we followed] up with the challenge winners, they said that the recognition was more important. If you look at a TED Talk, Dan Pink has a nice video on [how] at the poverty level, money is an incentive, but when people are getting paid, it’s not going to do much.

We have year-end iMed, or integrated medicine, awards. We have year-end CEO awards, we have year-end CIO awards. What we did this past year is, we were encouraged to submit a video explaining why you deserve to be considered for the CEO award. I’ll use the innovation team. Out of a hundred main entrants, we were in the top three. That, to me, was really awesome. We got a plaque, and we had dinner, and we got recognized at the CEO awards, which was broadcast via webcast.

Our video was shown. It was a 90-second video, and it talked about the cool things that we do. We saw an uptick in that, and interest in our website, and people coming to us. Like anything, recognition and communication go hand-in-hand, and at the end of the day, we’re a company of scientists… We like to solve problems, for solving problems’ sake. We’re not motivated by money. We’re motivated by recognition by peers.

With external challenges, what InnoCentive [our partner for those challenges] has seen through their postings is that if you post a challenge, and you don’t post an award that’s appropriate for the type of challenge that you’re posting, you’re going to get garbage responses. What it shows is that we’re putting skin in the game. We are going to reward you for well thought-out answers to our challenges. That makes a big difference to external parties, because the top solver at InnoCentive pretty much does this as his full-time job. He solves lots of challenges on the InnoCentive website, because he’s just a brilliant thinker.

Potential Pitfalls

You have to get legal and compliance to be your friends, first. You have to make them understand why you’re doing [open innovation], you have to show the clear cost benefit, and then I would take that one step further. You have to show the reason why, if you don’t do this, what the drawback is going to be. I would seriously consider why not doing it will be a failure. For the pharma industry, not doing it would lead to your competitors doing it, and having an edge over you. That’s just an oversimplification, but that’s one argument in favor of doing it.

Scott Wilkins: In the past, people may have looked at putting a problem out there as a weakness, right? If I put my problem out there, [my competitors are] going to know that I don’t have the answer. What we talk about [now is that] the patient doesn’t care who solves the problem. The business and the shareholders don’t care who solves the problem, so you’re not responsible for solving the problem. You’re accountable for solving the problem. I’ve seen a lot of lights go off with scientists when they say that, and it’s almost like they’re able to let go of any fear that they had once they get that.