Innovative Drug Development

Ultimately, the future of Lilly depends on bringing to patients new medicines—whether developed in our own labs or from outside our walls. This requires the innovation and development of new strategies to speed the delivery of medicines. It’s critical to our success as a company, and to the patients we serve.

That’s why Lilly has added a new approach to its drug-development strategy. This approach—unique to pharmaceutical companies—uses external venture capital and the company’s own virtual drug development organization, called Chorus, to expedite the development of compounds from Lilly and outside companies.

In typical drug development, a large number of compounds fail to make it past Phase II clinical trials. Chorus has developed more cost-effective and faster methods to reach clinical proof of concept—that is, to determine if a candidate drug is likely to be effective. That helps us determine whether to invest further in the most promising compounds.

Established in 2002, Chorus is a small, multidisciplinary drug-development group within Lilly that conducts early-stage development work. Chorus operates on a “virtual” model: It consists of a group of Lilly employees that manages drug-development work done by a network of hundreds of external experts and companies from around the world.

Chorus focuses on designing and executing highly focused development plans that progress compounds from candidate selection to clinical proof of concept in human clinical trials. Using this approach, Chorus has been able to reach decisions about 12 months earlier and at about half the cost of the current industry model.

 

Financing Innovation

Lilly has designed, and is investing in, several venture capital funds—dubbed the Mirror Funds—created to supplement the company’s pipeline and expand access to innovation. The funds will license drug candidates from Lilly and other companies and pay for clinical development and testing to take the compounds through the clinical proof-of-concept stage.

Our venture-capital partners get access to Chorus and Lilly molecules from the pipeline, and they share in the profits from successfully developed drugs. As an investor, Lilly also shares in fund profits. As of August 2011, one of the independent venture-capital firms participating in the Mirror Portfolio has acquired four molecules and will oversee the next phase of their development. Three of those molecules were developed preclinically by researchers at major academic institutions and are being studied as potential treatments for cardiovascular, diabetes, and oncology indications; the fourth molecule was developed by Lilly and is being studied for its potential in bone healing and cancer.

Lilly retains rights to buy back all Lilly molecules licensed by the funds as well as to evaluate and acquire a limited number of external compounds. Within five to seven years, the funds are designed to pay for the development of a pipeline of compounds that “mirrors” the number of compounds at this stage of development in Lilly’s own pipeline.

 
 

Innocentive: The Problem-Solving Marketplace

In 2001, Lilly launched InnoCentive, a company designed to expand Lilly’s access to the global scientific network. InnoCentive created a global online network that now exceeds 250,000 scientists around the world and operates as a sort of “open market” for technical challenges. Lilly scientists have tapped into this network to obtain solutions to many technical challenges, and external scientists have received monetary rewards from InnoCentive for solving technical problems. This crowd-sourcing approach has proved to be quite effective at solving challenges cost-effectively and efficiently.

In 2005, Lilly brought in venture-capital investors to expand InnoCentive, but retained 20 percent ownership and a seat on the board of directors. Since then, the company has expanded its open-innovation approach to address a broad array of problems from diverse sectors of society, including governments, nonprofits, and other corporations, both within and outside of the pharmaceutical sector. Clients, including Lilly scientists, NASA, the Cleveland Clinic, Procter & Gamble, the Environmental Defense Fund, and many others, post their problems under “pavilions” divided by topic area. At any given time, challenges posted across the pavilions might range from traditional biochemistry conundrums, to the creation of alternative fuel sources for impoverished women in the developing world, to removing contamination from plastics recycling, to how to more effectively conduct humanitarian food drops.

To learn more, visit the Innocentive website.

 

250,000
Approximate Total Registered Solvers from Nearly 200 Countries

12M+
Total Solver Reach through Strategic Partners

1,00
Total Challenges Posted to Innocentive.com

339,726
Project Rooms Opened to Date

24,256
Total Solution Submissions

866
Total Awards Given

$28M
Total Award Dollars Posted

$5k to $1M
Range of Awards, Based on the Complexity of the Problem

50%
Average Success Rate

*Employee data as of June 30, 2011