Facing high innovation risk, costs, and inefficiencies, sponsor companies have increasingly engaged in establishing risk-sharing partnerships, including joint ventures, mergers and acquisitions, in-licensing, and co-development arrangements.  

To understand collaboration practices and preferences, the Tufts Center for the Study of Drug Development (Tufts CSDD) examined the development and approval histories of 289 drugs approved by the FDA between 2000 through 2011. Of these drugs, half involved a collaborative development arrangement, with licensing deals being the most common risk-sharing approach.  

A quarter of these collaborations were part of a merger, acquisition, or co-development arrangement. Tufts CSDD also found that the prevalence for risk-sharing collaborations varied by therapeutic area, with approved central nervous system drugs having the highest prevalence. 

The growth of collaborative risk-sharing innovation models will likely accelerate in a drug-development operating environment characterized by scientifically and logistically complex and demanding protocols, low success rates, and high R&D investments that are targeting smaller market opportunities. 

— Tufts Center for the Study of Drug Development, 