The ophthalmic drug market was estimated to be ~$40 billion in 2020,1 with about 40 percent of that attributed to North America. This highlights the significant portion of the market outside of the United States. One just needs to perform a simple online search to see the number of business deals that were done in ophthalmology over the past year, with an impressive number occurring in China alone. As such, there’s a big opportunity available for partnering outside of the United States, especially in Asia.
As a new entrepreneur, or start-up company, you should at least consider what your strategy is to capture value in this large ex-U.S. segment, which may be in your near or long-term plans. For some companies, pursuing licensing outside of the United States is something that becomes part of later discussions, once clinical data or even approval is obtained in the U.S. In other cases, an ex-U.S. deal may be a critical component of early-to-mid-stage financing with either direct investment from a partner, or with incoming license fees. There are, of course, many considerations across business structure, financing, regulatory, etc., when looking at an international deal. Here, however, we’re going to focus on a few key pearls regarding development outside of the United States.
Clinical Development and Regulatory Responsibility
When entering into a deal with an international partner, it’s always a good practice to understand the other party’s objectives, needs and motivations. This ensures a good deal for everyone.
Motivation for a partner may, for example, be to gain access to your late-stage/commercial-stage asset that’s already de-risked for them, from their perspective of bridging development into that new territory. In that case, development in the United States may already be completed or finishing up, and it’s truly a focused regional deal, with each company being responsible for its own remaining development and commercial activities in each respective country.
In other cases, the ex-U.S. company may have a desire to get involved in a global development program. This may be in order to be most efficient with development in that region. For example, they may want to leverage minutes from FDA meetings in the United States with local regulatory authorities. Similarly, the ability to use global clinical data for registration in that country may help reduce the size or number of studies, and avoid the need to repeat activities in that specific country. The interest in being part of a global program may also be for managing perceptions in that country, and to demonstrate that the regional company is a global “player.” There may be different ways to address this second point, but we’ve seen situations in which “conducting a global program” may be interpreted differently by different companies.
If you’re in early discussions with a company for international rights, and they want to have a global program, make sure you’re clear whether that means that they’ll run their development in parallel, sharing information such as toxicology, manufacturing, clinical protocols, and maybe even using the same protocol as a template but keeping it a separate trial; or that the company wants a true global study with sites in both the United States and that region under one protocol. Before agreeing that each company covers its activities in its own country, be sure to understand this nuance. Either scenario is feasible— there’s not a right or wrong answer—and which one you choose depends on your situation, the needs of the program, and the capabilities of each company involved.
Running two separate protocols, of course, implies two processes that can be somewhat de-linked on two timelines. But if manufacturing is intended to supply both studies with product, or ongoing/future toxicology studies feed into both, then timelines will need to be aligned. Further, if the desire is a single global protocol conducted in multiple countries, generally speaking there will be one company designated as the sponsor. This company has the ultimate responsibility for duties such as contracting with investigative sites, taking point with the local regulatory authorities and engaging the appropriate contract research organization or vendor(s). If you have a U.S. study on a specific timeline and plan, you need to manage and be aware if a local ex-US partner you engage with is looking for a global study as part of the deal, since this can impact U.S. timelines. Also, be sure to define who has primary and supportive responsibilities.
You may also consider structuring the financial terms to match the data package used for submissions. For example, if your data in the United States helps your partner submit for marketing earlier, or saves a study in that territory, you can consider how that additional value is recognized for you as part of your deal.
You also want to avoid overlapping activities, such as a common toxicology study requirement or procurement of an active drug powder or manufactured supplies that both partners need. Also, if there is indeed sharing of data between the United States and that country, consider the time, cost and responsibility for any translation work necessary.
If the study is actually a global trial, there needs to be early alignment on regulatory meetings, with the same protocol submitted to the FDA and the other country’s regulatory authority, with the proper integration and review of feedback and/or changes. Be as specific as possible on what support is being provided by each party. For example it’s very easy to say that one party will “support” the other on
regulatory submissions and meetings in the other country. This can lead to misunderstandings on what exactly is needed by each party, and again highlights the importance of having a plan fleshed out in advance. Think through the specific regulatory requirements in each territory and how they’ll be fulfilled.
The process requires an early understanding of the proper project timelines, and an identification of rate-limiting steps, in order to drive the protocol to completion in each territory. Creating a detailed roles-and-responsibilities matrix is useful for such functions as regulatory, clinical, formulation, preclinical, manufacturing (of the active drug, and the finished product), medical writing and submissions.
The clinical plan, of course, needs to closely tie into manufacturing and toxicology. The goal is to arrange things up front in order to avoid potential confusion later. If supplies are coming from one partner, for example, make sure to think through scenarios that could occur if the trial in the ex-United States territory becomes larger, to avoid being caught off-guard with requests for additional supplies of the active drug (powder) or formulated product. In other cases, the partner might have a specific requirement to run a longer study in its country, requiring a longer duration of toxicology.
How different scenarios could impact the supply of the active pharmaceutical product is a critical issue to understand to ensure you’ve covered different possibilities and potential needs. In a situation in which each partner is responsible for its own manufacturing, make sure vendors understand this in order to avoid overlap and confusion.
Data Sharing and Intellectual Property
A key benefit to development in another territory is the ability to generate more data. Remember, there should be a structure in place for sharing all data, especially safety findings, and a pharmacovigilance plan in place for commercial product so that all parties across different countries have appropriate visibility on safety information. Any work in other areas will need to be summarized and submitted as part of your FDA submission in the United States for meetings, the Investigational New Drug application and, ultimately, the New Drug Application. The sharing will need to be reciprocal. It’s also an opportunity to have discussions with the FDA concerning how much of the data from controlled, randomized trials in other territories could possibly be used to supplement the NDA. In some cases, depending on the demographics and the disease, this may reduce the number of patients needed in the United States. The ex-U.S. partner may perform additional animal work, formulation, etc., and it’s wise to ensure you have rights to this information, with considerations regarding your ability to file patent applications in your retained territories, or at least benefit from patent filings in those areas.
We hope this brief column on ex-U.S. development gave you a couple of useful pearls. This is just the tip of the iceberg, however, and the other considerations for these kinds of international deals could fill another article. These special considerations include:
- sub-licensing rights in a territory;
- intellectual property;
- new formulations;
- combination products (and different situations for combination with generic available products vs. internal proprietary compounds one party may have); and
- new incorporation of third-party IP.
The key to the process is to define who is doing what as clearly and specifically as possible. Of course, one also needs to balance all this with deal momentum and the fact that, in drug and device development, things often don’t go as planned, and there may need to be adjustments and amendments. It all begins with a solid working relationship and partnership.
Mr. Chapin is a senior vice president of the Asset Development & Partnering Group at Ora, which offers drug, biologic and device consulting; preclinical and clinical research execution; and development strategy and support, in an effort to promote new client and partner initiatives. Review and comments on this column were provided by Aron Shapiro, partner in the same group at Ora. The author welcomes your comments or questions regarding product development. Please send correspondence to firstname.lastname@example.org or visit
1. Independent research report prepared by Research and Markets. Ophthalmology Drugs Global Market Report 2021: COVID-19 Impact and Recovery to 2030.