R&D Productivity at GSK? He CEDD, She CEDD
Management endorsed GlaxoSmithKline's new R&D structure-the CEDDs-as an overwhelming success during the Big Pharma's December 2003 R&D day. But the analyst and investor communities weren't uniformly impressed. And fair enough: regardless of GSK's excitement and the storm of numbers and early stage results that promise a robust series of product launches, it's too early to judge the success of the CEDD experiment. A lot can go wrong between now and 2008, when the pipeline will ripen or rot.
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GSK's various thwarted efforts to boost productivity through R&D revamps begs the question whether big pharma should be trying to do in-house discovery and early development at all.
Not satisfied with its R&D experiments to date, GSK has taken its most radical step yet toward re-creating biotech within its walls: even smaller units complete with investment boards occupied by external VCs and CEOs and milestone-based funding and external VCs.
Convinced of the merits of its Center of Excellence set-up across R&D, GSK has built another unit focused exclusively on external drug discovery, with a broader, risk-sharing deal-style. The aim is to expand R&D without increasing the company's size.