Manage R&D Resources to Increase Productivity

Challenge

Our client, a mid-sized pharma company, required inspiration for how best to:

• Determine and manage the total R&D budget
• Allocate resources to different R&D activities
• Use different criteria to prioritise across all phases of R&D from discovery through to brand support

• Determine total R&D budget through an iterative top-down and bottom-up process
• Build in flexibility, allowing total R&D spend for vary from year-to-year within an accepted corridor
• Ring-fence for discovery based on the agreed strategy for balancing in-house and external innovation
• Reallocate budget between R&D activities flexibly as the portfolio and priorities evolve
• When prioritising projects for investment, use NPVs carefully as part of a broader assessment
• Place more emphasis on non-financial criteria for early-stage projects

Results

Our client gained deeper insight into how comparable pharma companies manage their R&D budgets, providing a strong foundation from which to evolve their approach