Use an Integration Playbook to Navigate the Complexities of R&D Mergers and Acquisitions

In the life sciences sector, M&A has become commonplace as organizations seek to bolster product portfolios, stave off patent expirations, and reach new markets. 2019 started off with a bang with the announcement by Bristol-Myers Squibb (BMS) on their intent to acquire Celgene.

M&A activities can impact the day-to-day routine with little notice. Due diligence teams are usually comprised of representatives from key areas of the R&D spectrum, including Regulatory Affairs, Statistics Data Management, and Project Management, but rarely are many of the tactical functions in Clinical and Regulatory Operations most heavily impacted by integrations engaged until the deal is either announced or imminent.

Integrations are disruptive because new people, products and technologies are suddenly introduced into the mix, and study teams must maintain trial operations while also making decisions about things such as processes, systems, upcoming filings or inspection, or the turnover of colleagues. As such, it is essential for R&D organizations to have a playbook for integration.

What is an Integration Playbook?

An Integration Playbook is a set of processes and tools that describe an organization’s approach to completing M&A activities. It should lay out the objectives, activities, roles and responsibilities and target timelines, and provide tools, templates and best practices to guide teams in executing a successful integration. A well-developed playbook in the pharmaceutical R&D space may include specific activities for different M&A flavors, such as product in-licensing or divestiture, program or study integration, or complete merger or assimilation of another organization. 

Integration Timelines

For simplicity, the integration timeline can be divided into three phases: 1) Prior to announcement/execution of the deal, 2) Between execution and close, and 3) Post-close.

• Prior to the announcement, visibility into the process is often limited to a select few people who must make a go/no-go decision on the deal without the benefit of free-flowing dialogue with functional representatives. But even though your team may not be at the table, you can ensure that critical considerations are factored into this decision-making process by defining and communicating the most important areas for attention and signals that might indicate an issue.
• After the deal is announced, communication and information exchange become more transparent, although many activities still cannot proceed until after the deal is officially closed. This is a good time for the organization to open up lines of communication and build relationships. Information obtained during this time helps reaffirm the approach defined later in the playbook and give teams a head start on making adjustments to the plan.  Leveraging trusted third party consultants during this time can be a valuable planning exercise, to keep the proper communications separated, while gaining valuable insights on current state across the two organizations for planning purposes moving forward (such as current or planned capital programs which could be aligned to reduce effort and costs in the integration window).
• Once the deal closes, the pace of  action will accelerate. A poorly coordinated integration effort will cost the company money, frustrate and demoralize colleagues, and delay the realization of benefits. A well-defined and continuously updated approach will keep the integration team on track, provide a baseline for expectations, and ultimately help to deliver the benefits that drove the business case for the integration.  It is critical to establish early on in the process a strong organization, technology and data/content integration roadmap, maintaining focus on the need to minimize the disruption of critical business milestones, such as clinical trial execution and key submission milestone activities.

Key Integration Activities for Clinical Teams

Here are just a few activities that your playbook should address.

• Process harmonization – Selection of go-forward processes is critical to maintaining efficient operations and minimizing confusion. Your organization may opt to maintain legacy processes for a period of time, or cut over to a preferred set of processes quickly. Your playbook should include the steps for evaluation of these processes, impact analysis to active teams, and transition and retraining timelines.
• Vendor relationships – Vendors should be evaluated to determine if there are redundancies in service providers, as well as to ensure that existing contracts and SOWs are not compromised by the change of control. Furthermore, oversight processes should be evaluated to ensure proper management and QC of third-party activities prior to the integration.
• System selection – Having a plan for quickly unifying transactional data systems is essential to achieving efficiencies, lowering the risk of data loss and allowing for proper analysis and reporting of study data. Study data should be migrated to preferred systems and redundant systems decommissioned. 
• Record management – In addition to the data stored in clinical systems, legacy company records may be scattered across multiple paper and electronic filing systems, including offsite storage. Oversight of company records should be unified to ensure that handling is controlled and retention decisions are made using a common record management policy.
• Risk assessment – Across all aspects of the integration is a need to evaluate legacy activities to determine if there are latent risks, especially related to patient safety, GxP and regulatory compliance. Your playbook should include a methodology and supporting tools for evaluating legacy administrative and study-related activities to ensure that you have not inherited a major issue.
• Portfolio prioritization – If the deal is a full merger or acquisition, you may be inheriting a portfolio of commercial and development programs and will have limited time to assess the portfolio. Your organization needs to determine which of these programs present imminent marketing or inspection risks and prioritize attention to review of those programs.
• Institutional knowledge – A great deal of undocumented information resides with the people who work for the acquired or divesting company. Unfortunately, in many integrations colleagues are separated before that knowledge is captured. Your playbook should include plans for connecting with key colleagues and documenting information, including informal processes or policies as well as ‘storyboards’ for clinical studies that can be used for inspection readiness and response in the future.

Maintaining your Playbook

At the heart of the integration process should be a program management office that serves as the controller of the playbook itself, and ensures that all of the moving parts are properly coordinated on active integrations.

Every integration is unique and there are always lessons to be learned, both for future integration teams and for the due diligence process itself. A continuous feedback loop with the program management office should be in place to ensure that the playbook remains up to date and provides the most value to your organization in the future.

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