Alliance Management is a relatively new role within the Life Science industry and arises with the need of the pharma industry to broadly collaborate instead of relying solely on its own R&D pipeline. The rise of Alliance Management is connected to the increasing number of partnerships from new product concept to licensing deals or potential mergers and acquisitions driven by the need to develop new products quickly, to reduce costs and gain access to new markets while limiting the risk exposure.
While there is an upside of forming alliances that could have a huge impact on the company product pipeline and organisation, the downside is that many of those opportunities are “half baked” and require significant attention post signature. It is therefore up to the Alliance Managers to build and retain effective collaborations and ensure that the maximum value is captured and mutually beneficial.
Despite its importance, Alliance Management as a function is still not implemented. In a Deloitte study, 63% of companies did not have a dedicated Alliance Manager and half of the 63% did not know where the Alliance Management function would be from an organizational point of view. While typically Alliance Management reports to the Business Development function, this is not the only department involved in alliances – R&D for instance manages R&D, academic and research collaborations.
Alliance Managers performs a variety of tasks but all with the ultimate goal of making successful alliances. Successful alliances are long-term, value creating business relationship. As Alliance Managers we struggle to create incremental business value through collaboration which implies to understand partners real needs while our business environment is obsessed with competition and speed to market
The multiple responsibilities of Alliance Management can be grouped in four pillars:
First getting a good start of the alliance is critical and accelerating start up from deal team to operational/functional team will be a decisive factor to the success of the Alliance. The Alliance Manager facilitates the handover from the transaction team clarifying the key legal and governance aspects, getting everyone on board internally and externally and aligned behind thekey terms/expectations of the deal. Moving forward the Alliance Manager will also be able to continue to get all parties involved through mutual trust and confidence in the alliance both internally and externally. This requires frequent communications, straight talk and transparency but no one knows the ins and outs of an alliance like its Alliance Manager. Lastly, the Alliance Manager will develop a joint strategic map that captures the partnership goals.
The second element is optimizing/maximizing the value of the alliance. Each alliance has an enormous potential but extracting the full value is a challenge unless Alliance Management ensure every stakeholder from both companies understand the value envisaged at the time of the deal making and push them constantly towards value creation. Ultimately if the alliance requires changes then the Alliance Manager should lead the negotiation of the amendment of the contract as required. And, if despite efforts some alliances fails, once again the Alliance Manager will be an invaluable resource to successfully end the relationship.
The third element is providing contract management capabilities. Alliance Management provides a one-stop shop to the organization on every collaboration by tracking performance and managing key deal terms and obligations. Reporting ensures that no obligations are forgotten.
The last pillar is about ensuring operational stability of alliances. Through its internal cross-functional interactions and regular discussions with partners, Alliance Management is the only function which has a 360 degree view on the alliance at any time. Alliance Management also plays an instrumental role when conflicts arise in solving them quickly and successfully.
Through the successful execution of all those responsibilities, Alliance Management raises awareness internally regarding its value to the organization. Actually the best way to make Alliance Management more visible throughout the organization is to demonstrate successful alliances as defined earlier i.e. forging long term, value creating business relationships. In addition, by creating consistency in the management of the partnerships while taking into account at the same time partner differences, as well as mentoring the organization on how to collaborate effectively, Alliance Management contributes to position the company as the best company to partner with.
Pharmacist by background and after nearly two decades in multinational biopharmaceuticals organizations, Céline Carlet is an accomplished Corporate Strategy professional with track records in leading commercial, business and strategic corporate development initiatives. Currently in charge of the Alliance Management at Ferring international, her priorities are to excel at leading integration of Ferring external collaboration portfolio, managing complex international alliances as well as creating Alliance Management capabilities across the Ferring organization.