GSK's "Open Innovation" Strategy

I just got off of a conference call with Andrew Witty, CEO of GlaxoSmithKline (GSK). He started out by saying that pharmaceutical companies like GSK need a more pluralistic approach toward solutions. To that end, GSK will pursue an "open innovation" strategy toward delivering better medicines to people in poor countries.

This strategy will include an "Open Lab" with 8 million dollars seed funding, an effort to share intellectual property to fight tropical diseases, and a pledge to create "sustainable pricing" for a malaria candidate vaccine.

This morning at Council on Foreign Relations, Witty made what he called "the most striking" commitment to put into public domain 13,500 chemical structures that may fight malaria. In doing this, Witty is hoping to stimulate more innovation efforts--increasing "the bandwidth of discovery." He does not necessarily expect GSK to be rewarded financially from this move. From the press release:

GSK has screened its pharmaceutical compound library of more than 2 million molecules for any that may inhibit the malaria parasite P.falciparum, the deadliest form of malaria, which is found primarily in sub-Saharan Africa. This exercise took five scientists a year to complete, and has yielded more than 13,500 compounds that could lead to the development of new and innovative treatments for malaria, which kills at least one million children every year in Africa.

GSK will make these findings, including the chemical structures and associated assay data, freely available to the public via leading scientific websites. The release of these data will mark the first time that a pharmaceutical company has made public the structures of so many of its compounds in the hope that they could lead to new medicines for malaria.

He said it was partly a personal decision. His travels, seeing suffering abroad, have led him to want to fight malaria. A malaria vaccine (called RTS,S) is already in Phase III of clinical trials and is two years away from reaching the market. Last year, this pivotal phase was launched and it is well underway in seven African countries. The results of Phase III are expected next year--2011, and if all goes as planned, the vaccine could reach the market in the next couple of years. As further background, RTS,S is the result of a partnership between GSK, The Malaria Vaccine Initiative (MVI) and the Bill and Belinda Gates Foundation. (CORRECTED)

Witty said he hoped that other companies would join GSK's open innovation strategy.

In Witty's travels to poor countries, he said he noticed that pieces of the solution were present but were not put together. And this problem has often been used as in excuse for poor health conditions. GSK hopes to find local partners to serve as delivery vehicles of GSK's investment.

In the long-term, "it is all about horizons," he said. He hopes that African economies become prosperous. But for now the company's interest in applying investments and ideas to improve the conditions in Africa--a "non-commercial" interest.

Could open innovation become the dominant paradigm for developing drugs in poor countries? "It is one step at a time," Witty said.