The term 'Big Pharma' has a negative connotation for many people who believe that the world's largest pharmaceutical companies are allegedly hindering innovation in the medical field. Some also believe conspiracy theories outright accusing Big Pharma of withholding or suppressing cures to major diseases. Meanwhile, there is an emerging class of companies known as 'Small Pharma,' composed of biotechnology startups and similar organizations that are responsible for most of the innovation in the pharmaceutical field today.
According to Dr. Juho Jalkanen, the CEO of Faron Pharmaceuticals, a clinical-stage biopharmaceutical company based in Finland, there is a symbiotic relationship between Big Pharma and Small Pharma that enables the public to benefit from life-saving treatments. The data shows that smaller companies are more innovative, exploring areas that are under-researched or underserved. This is Small Pharma's lifeline, as coming up with something new is what allows them to remain competitive in the industry. Unfortunately, they often lack the resources to support the various clinical trial phases to obtain regulatory approval, as well as the production capacity to bring a drug to the wider market.
On the other hand, Jalkanen states big pharma companies have the funds and production capabilities to do so but, like most large organizations, are less agile and more bureaucratic. The complementary qualities of these two types of companies have resulted in frequent partnerships, where the small biotech conducts early-stage research and development while the large drugmaker funds the extensive clinical trial process and mass production once regulatory approval has been achieved. This is mutually beneficial for the companies, with the revenue allowing the small company to grow and fund further research and development activities.
Faron Pharmaceuticals' flagship product, bexmarilimab (bex), is a humanized monoclonal antibody molecule that shows potential in treating several treatment-resistant cancers. Bex's mechanism of action involves binding to Clever-1, an immunosuppressive scavenger receptor found on macrophages. By binding to Clever-1, bex allows the immune system to attack the tumor cells, reducing its size or eliminating it.
Bex is currently undergoing in-human Phase I/II clinical trials, and it recently received fast track designation from the US Food and Drug Administration (FDA). Earlier this year, Faron Pharmaceuticals raised $30 million in an oversubscribed funding round, showing investor confidence in bex's potential to be a valuable treatment for various types of cancer.
Having navigated the biotech and pharmaceutical space even before becoming CEO of Faron, Jalkanen has encountered various challenges, especially around securing funding and partnerships. On the opposite end of the spectrum, many big pharma companies' business development departments have to filter through hundreds of partnership proposals each year, and finding the right ones to fund is no easy task. While artificial intelligence has been proposed as a solution, Jalkanen says that AI's applicability is limited due to its lack of understanding of biology.
Jalkanen believes that for the Big and Small Pharma partnership model to work, it's important that the smaller partner receive an adequate amount of recognition when it comes to the successful development of a drug. This is because of the reality that innovation and drug development require a lot of funds, and the companies that are more likely to get funded are those that have been successful previously. With innovative companies no longer worrying about how to get funding, they can focus more of their efforts on drug development, which benefits everyone in the end.
"It is very difficult for small companies to do Phase Three trials and commercialize their discoveries because clinical drug development has become more and more expensive over the years," Jalkanen says. "That's why these symbiotic partnerships are essential for the industry to work. Small Pharma brings the innovation, while Big Pharma brings in the money and operational power. Having a more harmonious and equitable partnership between the two parties ensures that the innovation pipeline continues flowing, resulting in a win-win situation for all."
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