AstraZeneca pushes innovation wide open with BioVentureHub
Imagine a fresh gang of biotech scientists sharing the canteen at a large pharma company, arriving every day for lunch, sitting anywhere and talking to any of the 2,600 pharma employees. Welcome to AstraZeneca's BioVentureHub in Gothenburg, Sweden, that takes Open Innovation to a new level of openness, with innovation that is not centered exclusively on developing assets but with a priority for sharing knowledge.
“It happened fast, almost too fast,” said Magnus Björsne, CEO for AstraZeneca's BioVentureHub. In just one year the hub, created in collaboration with the Swedish government and other public investors, has co-located 17 companies literally at the heart of the pharma company's sprawling site in Gothenburg, Sweden.
"The hub is located as centrally as you possibly could be at our site, not off in some adjacent development but really in the middle. And we have been able to construct a model for Open Innovation that is truly open, where the huge resources that reside in a pharmaceutical company can be tapped into by small biotech teams and academia," he said.
Magnus Björsne, CEO for AstraZeneca's BioVentureHubThe BioVentureHub does not welcome startup companies but recruits more mature companies that are facing the famous Valley of Death on their development pathway.
"There are other innovation centers and incubators, but I don't believe anyone else is approaching things this way," said Björsne. "What these companies need more than funding is access to skills, the kind of expertise that resides inside a big pharma company like ours. These companies usually know how to do their preclinical research. What they normally know less about is how to commercialize, how to move the science to become a pharmaceutical product.
"AstraZeneca does not want to act as a CRO, and if a company in the hub asks for help that they can buy elsewhere, we tell them to go out and buy it. If instead they are looking for the type of competencies that are hard to access, that's where we try to help. It could be getting access to a specialist, or a lab, it could be about meeting with our pharmaceutical development unit, they can tap into our experience in animal experiments or chemistry, or get help with strategies and formulations.
"The part that then makes this very cool is that we are deliberately blending value chains in the hub. Moving forward, innovation in healthcare is going to be a combination of digital health, medtech, diagnostics and pharma. And we believe with this hub we have created the foundation for that kind of innovation by putting all these value chains in the same corridors. That way a lot of interesting things start to happen.
“In the first year, the companies in the center have posted milestone successes, not all of which can be claimed by the BioVentureHub,” Björsne said, “but which contribute to the vibrancy at the center.” Two companies successfully launched IPOs on the NASDAQ exchange, two new drug applications (NDAs) were approved for the start of clinical trials, and one product was approved.
"We also have the example of one of our companies that started in August and today has 19 employees with a turnover north of 50 million Swedish crowns," he said.
For AstraZeneca, engaging with the companies is cost-neutral as the company is compensated under the funding model for seconding resources or for hours spent by staff with companies in the hub.
Björsne returns to the word vibrancy to describe the BioVentureHub.
"You have to imagine that the hub company employees are sharing our canteens, and that helps to create a pretty cool environment. Our people know the rules, and they are encouraged to speak to the hub people, to engage. This creates a lot of vibrancy on the site. These people tend to do things very differently than we do, sometimes better, sometimes maybe not, but it is different.
"Since most of the companies are not startups they have the intellectual property (IP) in place, which means we can talk with each other freely without entering legal arrangements for confidentiality. Everything is set up to learn from each other.
"People at a large pharma are trained scientists, experimentalists, but we rarely experiment with how we do business, and how we run our business. The BioVentureHub was set up to do something about that. That's how it all started. When it comes to totally novel science, pharma can sometimes be reluctant to engage, because we want to see whether it is going to work, and then we try to jump on the train once it has left the station. The hub is a way for us to build a station ahead of the train leaving it.
"We are somewhat unique in the world today for having all skills available to these companies at one site, going from an idea all the way through development to production in one location. The hub companies have the same access to the site as our employees, the entire site. We have some tight collaborations with these companies, collaborations we would never have done if not for the hub. And these collaborations are not set up with the purpose of them or us making money. They are set up to see what we can learn from each other."
In the coming year, as the model for the BioVentureHub matures, Björsne said he will be looking to companies outside Scandinavia and even Europe. He is currently in discussions with a company experienced in digital health from the medtech perspective that is interested in moving into the pharma space. And he is considering a medtech company from Asia to blend into the skill set and further enhance the mix of value chains.
A host for BIO-Europe Spring® in Stockholm in early April, the AZ BioVentureHub will sponsor a stand in the exhibition area where Björsne said he welcomes meetings with interested parties.
Most often, he said, candidate companies for the BioVentureHub are identified through investors, rather than directly.
"This approach is often more efficient because one investor may be hooked up with 30 companies, and because these companies are not startups, the investors are typically sitting on a good share of the equity in the company. It becomes important that they are on board, and that they understand the benefits of this ecosystem," he said.