Integrated Innovation: Fostering The New Growth in Pharma

The pharma landscape is constantly changing, especially as many players in the industry move toward slimmed-down in-house R&D. This includes embracing the “growth pharma” model in which drug discovery programs are obtained via acquisitions. Many big pharma executives have left their posts to spearhead lean, high-risk, high-reward biotech firms, start-ups and virtual companies, which lack wet labs and other means of obtaining experimental results.


Recent examples of plunging stock prices at several big firms portray an industry too reliant on blockbuster drugs to sustain growth. But clinical failures are only part of the story. Branded drugs have faced pricing pushbacks from consumers, and in several key areas are confronted with competition from generics and biosimilars.1 On November 23 of this past year, the NYSE Arca Pharmaceutical Index was down 13% and the Nasdaq Biotechnology Index was 17% lower, all while broader market indexes remained up.2 What this tells us about the industry as a whole is that investors are anticipating a tide change. Perhaps the best indicator of this is the numerous stories of big pharma executives changing careers and joining smaller biotech startups.3

But one can argue that the recent upsurge in smaller biotech firms came before the industry was adequately equipped to handle the substantial outsourcing these firms rely on.

These lean companies often lack rudimentary wet labs or any internal facilities capable of producing novel experimental results, and therefore face logistical challenges in which services of one drug discovery program are splintered into multiple organizations. To add to this, finding the best CRO can lead the search into different time zones, geographies and company cultures.4

To cope with difficulties these small firms face in terms of integrating different aspects of a drug screening program, other biotech startups have arisen to allow experiments to be designed in-house and carried out in robotic facilities elsewhere. Although these ‘cloud laboratories’ will certainly find a demand within an increasingly fractured industry, for companies looking for guidance alongside experimental results, they offer little.5


The shift in the industry was made clear when then-Actavis — now Allergan — CEO Brent Saunders coined the term ‘growth pharma’ as a differentiator to separate Actavis from a big pharma industry that was, and still is, having difficulties meeting investors’ expectations. The growth pharma paradigm differs from the aging big pharma business model that does not rely on internal R&D but fosters innovations through acquisitions. Ultimately this has been a successful model, at least for Allergan, which saw a 4.5% revenue increase in the third quarter of 2016 when compared to the same quarter in 2015.6

What came of this was that 2015 saw a 20-year high in venture capitalist investment in biotech firms.3 A market filled with high-risk, high-reward companies allows for an agile industry that quickly pivots to shirk selloffs that happen when potential blockbuster drugs fail in the clinical setting. To be sure, 2016 in particular saw a flurry of acquisitions, and the nix of the merger between Pfizer and Allergan has again solidified the growth pharma paradigm philosophically as well as economically (both Pfizer and Allergan have committed to more than $20b in acquisition since they went their separate ways).7

Icagen has been anticipating the industry’s arrival of growth pharma over the aged big pharma model, and has uniquely positioned itself to be the industry’s incubator: a one-stop shop with a completely integrated drug discovery program, one that moves beyond the fractured outsourced model of specialized CROs and into a true partnership for biotech firms looking to innovate and grow within the pharmaceutical industry.


Icagen’s acquisition of Sanofi’s Tucson facility in mid-2016 changed the face of the company. This move transformed Icagen from a highly specialized CRO into North America’s first truly integrated drug discovery contract research organization. This was achieved by introducing the broad scope of the Tucson facility’s drug discovery program to the rigor of a highly specialized North Carolina site that has spent nearly a quarter of a century, with essentially the same core team, trying to unravel one of the more difficult drug discovery targets: ion channels and transporters.

The acquisition of the Tucson facility added chemistry, structural biology and in silico approaches for early drug discovery to the North Carolina site’s top-of-theindustry biology. Adding Icagen’s meticulous knowledge of ion channels and transporters to the Tucson facility’s integrated approaches is already starting to transform the way the company pursues a wide range of targets. For example, Icagen’s deep knowledge in ion channel biology is now married to an expertise in Tucson for patient-stem-cell– derived skeletal and cardiac muscle models.


In the current fractured model of outsourcing, a company must rely on different CROs to put together a drug discovery program. For example, a pharma company may contract one organization for early drug discovery via in silico approaches, and several others for medicinal chemistry and biology wet labs. At Icagen, all of these services are provided in a fully integrated drug discovery program that is capable of adaptive learning, as Icagen’s lattice of biology, chemistry, structural biology and in silico modeling interface with each other continuously throughout the program.

Real-time research optimization not only increases efficiency, ultimately it enables Icagen to be a better partner — especially because of the crosstalk that happens between the sciences. Biologists thinking about chemistry, and chemists thinking about the implications for biology, create a unique form of translational science that cultivates novel approaches to drug discovery, one where in silico simulations turn into promising compounds. At Icagen, a partner will find everything they need under one roof, in addition to a different kind of scientist. Scientists at Icagen not only have strong expertise in their field but offer a unique translational knowledge of all fields, demonstrating that true integration leads to the discovery of strong drug candidates. In the fractured model, a company must wait on results from one CRO before moving to the next — at best creating ‘white space’ in programs, at worst missing key insights between disciplines. At Icagen, drug discovery occurs in a web of biology, chemistry, structural biology and in silico modeling, in which reevaluations and readjustments happen seamlessly and in real time.


In a changing industry model that increasingly embraces ‘growth pharma,’ guidance and expertise are needed more than ever. In many ways, Icagen sees itself as this new industry’s incubator. Not only is Icagen a fully integrated drug discovery CRO, Icagen is a think tank that houses industry leaders in every realm of drug discovery. This means better results in less time, especially when the real-time research optimization of the integrated drug discovery program at Icagen is compared to linear and other fractured models of CRO outsourcing. Furthermore, Icagen’s two facilities — in Tucson and North Carolina — mean that it is not necessary for potential partners to maneuver time zones, language barriers and corporate cultures that can create costly disruptions in getting drug candidates to IND.


  1. Grant, Charley. “The Problem With Lilly Is the Problem With Pharma.” The Wall Street Journal. Dow Jones & Company, 23 Nov. 2016. Web.
  2. Loftus, Peter. “Eli Lilly Alzheimer’s Drug Fails Trial.” The Wall Street Journal. Dow Jones & Company, 23 Nov. 2016. Web.
  3. Alsever, Jennifer. “Big Pharma Innovation in Small Places.” Fortune, 12 May 2016. Web.
  4. Whalen, Jeanne. “Virtual Biotechs: No Lab Space, Few Employees.” The Wall Street Journal. Dow Jones & Company, 04 June 2014. Web.
  5. Hayden, Erika C. “The Automated Lab.” Nature. 516 (2014): 131-132. Web.
  6. Herper, Matthew. “This Giant Drug Firm Won’t Invent Medicines. Investors Are Cheering.” Forbes Magazine, 9 Feb. 2015. Web.
  7. Grant, Charley. “Big Pharma’s Big Checkbooks Drive Biotech Resurgence.” The Wall Street Journal. Dow Jones & Company, 21 Sep. 2016. Web.


Anil C. Nair, Ph.D.
Vice President, In Silico Drug Discovery, Icagen, Inc.

Dr. Nair is responsible for computer-aided drug discovery at Icagen. Prior to this, he was the Head of In silico Drug Discovery at Sanofi’s Tucson site. Dr. Nair has a Ph.D. in quantum chemistry and over 20 years of experience in computer-aided drug design.

Email[email protected]

Kenneth F. Wertman, Ph.D.
Senior Vice President, Icagen, Inc.

Dr. Wertman holds a Ph.D. in molecular and cellular biology from the University of Arizona, with postdoctoral research training at MIT. Subsequently, he joined Selectide, a founder biotech in combinatorial chemistry. Dr. Wertman is the Director of the Icagen Center in southern Arizona, where his passion is in creating innovation at the interfaces of chemistry, biology and computational sciences.
Email[email protected]


Marcel Patek, Ph.D.
Vice President, Chemistry, Icagen, Inc.

Dr. Patek obtained his Ph.D. degree from the Institute of Organic Chemistry and Biochemistry of the Czechoslovak Academy of Sciences in 1992. Dr. Patek heads the department of chemistry with responsibilities for analytics and compound logistics. His research interests include medicinal chemistry, lead generation and optimization, computational chemistry, peptide chemistry, and applications of high-throughput synthesis and solid-phase synthesis in drug discovery.

Email[email protected]

Paul R. August, Ph.D.
Vice President, Biology, Icagen, Inc.

Dr. August leads the discovery biology department at the Icagen Tucson Innovation Center. He has more than 20 years of experience in pharmaceutical discovery and the management of global, collaborative research projects. Dr. August received his Ph.D. from the University of Minnesota in Minneapolis-St. Paul, an MS from the University of Connecticut in Storrs, and a bachelor of arts degree from St. Anselm College in Manchester, NH.

Email[email protected]

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