Key steps & practices in Pharma In-Licensing

In the dynamic landscape of the pharma industry, navigating the in-licensing process is a strategic imperative for companies seeking to strengthen their products. This complex journey involves identifying promising assets, negotiating agreements, and ultimately integrating external innovations.

Key steps & practices in Pharma In-Licensing

In-licensing refers to a formal collaboration where one company provides financial support to another to develop and launch a new drug. This strategic partnership helps the financial burden on the receiving company, making it an invaluable arrangement, particularly for emerging biopharma startups aiming to bring their novel medicines to the market.

The company that holds the rights to the drug or technology is the licensor, while the company acquiring the rights is the licensee.

From finding good possibilities to making fair deals, understanding this process is super important for companies wanting to do well. This article is like a helpful map, outlining the essential steps and strategies for thriving in the pharmaceutical in-licensing industry.

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What is the importance of in-licensing in Pharma?

In-licensing holds significant importance for pharmaceutical companies. It’s a crucial avenue for companies to access essential resources and expertise. Strategic partnerships and agreements help the companies secure the financial support needed to develop and bring new drugs to market. This collaborative approach accelerates drug development and allows companies to share risks and rewards.

  1. Access to innovative medicines: By addressing healthcare issues and raising standards of care, in-licensing facilitates the access of novel medications to developing nations. 
  2. Cost-effective drug development: In-licensing helps to acquire promising drugs with minimal research and development.
  3. Cost and risk mitigation: In-licensing can be a strategic move to reduce development costs and risks associated with new product development, as companies leverage existing solutions rather than starting from something new.
  4. Faster market entry: It helps bring new drugs to market quickly, addressing urgent healthcare needs with pre-developed drugs.
  5. Shared risk: Pharmaceutical in-licensing involves shared risk, with the licensor and licensee sharing costs and uncertainties for drug development.
  6. Capacity building: In-licensing involves knowledge transfer and technology exchange, strengthening local pharmaceutical industries.

How does In-licensing work?

In in-licensing, the company (the licensee) obtains the rights to use, develop, or market a product or technology owned by another company (the licensor). This often occurs when the licensee sees value in a product but doesn’t want to create it from the ground up.

  • The licensor, having already developed the product, agrees to let the licensee work with it. This collaboration typically involves a legal agreement specifying the terms, including financial aspects like upfront payments, royalties, or profit-sharing. Both parties share responsibilities and risks, making it a mutually beneficial partnership.
  • In essence, in-licensing allows a company to leverage existing innovations without investing the time and resources needed for original development, which provides the licensor with additional revenue streams and a broader market reach.

The process of in-licensing in Pharma 

It is necessary to understand the process before delving into the specifics of in-licensing. This will help you make well-informed decisions and ensure seamless integration of in-licensing into corporate operations for long-term success.

This article will shed light on the key steps and considerations involved in the in-licensing process, offering insights that can empower businesses to make informed and strategic decisions in pursuit of sustained growth and success.

Clarifying strategic objectives

Begin by defining your company’s strategic goals. Are you looking to expand into new therapeutic areas, address unmet medical needs, or strengthen your existing portfolio? Clearly articulating these objectives sets the foundation for a targeted in-licensing strategy.

Market analysis for informed decisions

A thorough market analysis is crucial. Dive into patient demographics, disease prevalence, and competitive landscapes. Understand the market dynamics to identify opportunities that align with your strategic goals.

Due diligence for informed decision-making

Before committing, conduct due diligence on potential assets. Scrutinize scientific, clinical, and regulatory aspects to mitigate risks. A comprehensive evaluation ensures that you make informed decisions based on solid data.


Valuation goes beyond financials. Consider the scientific merit, market potential, and competitive landscape. Accurate valuation provides a realistic understanding of the asset’s worth, helping you make sound investment decisions.

Strategic negotiations for mutual benefit

Negotiations aim for terms that match your budget and goals, promoting a partnership where both sides gain.

Legal and regulatory compliance

Legal and regulatory compliance in pharmaceutical in-licensing is critical to navigating the complex landscape and ensuring a smooth and lawful collaboration.

Here are key considerations:

  1. Intellectual property (IP) rights
    • Verify the validity and strength of the intellectual property associated with the in-licensed asset.
    • Ensure that the licensing agreement clearly defines the scope of IP rights, exclusivities, and any limitations.
  2. Regulatory approvals
    • Confirm that the in-licensed product complies with regulatory requirements in relevant jurisdictions.
    • Address potential regulatory – hurdles or differences between the licensor and licensee regions.
  3. Data privacy and security
    • Adhere to data protection laws to safeguard patient information and sensitive data.
    • Include provisions in the agreement to ensure compliance with data privacy regulations.
  4. Good manufacturing practices (GMP)
    •  Ensure that manufacturing processes for the in-licensed product comply with GMP standards.
    • Address any quality assurance and control requirements stipulated by regulatory authorities.
  5. Clinical trial regulations
    • Confirm that any ongoing or planned clinical trials related to the in-licensed asset adhere to relevant clinical trial regulations.
    • Address reporting requirements and obligations to regulatory agencies.
  6. Compliance with pharmacovigilance
    •  Establish procedures for monitoring and reporting adverse reactions or safety concerns.
    •  Ensure compliance with pharmacovigilance requirements and reporting obligations.
  7. Labeling and packaging compliance
    • Verify that labeling and packaging meet regulatory standards in target markets.
    • Address any specific requirements for product information, warnings, or language translations.
  8. Advertising and promotion compliance
    • Ensure that marketing and promotional activities comply with regulations and guidelines.
    • Address any restrictions on advertising claims, promotional materials, or direct-to-consumer marketing.
  9. Anti-bribery and corruption laws
    • Implement measures to prevent bribery and corruption, ensuring compliance with anti-bribery laws.
    • Include clauses in the agreement that address anti-corruption commitments.
  10. Export control and trade compliance
    • Confirm compliance with export control regulations for the transfer of technology, products, or information across borders.
    • Address any restrictions or licensing requirements related to trade compliance.
  11. Compliance with healthcare laws
    • Ensure adherence to healthcare laws and regulations. Ex: interactions with healthcare professionals, patient assistance programs, and pricing.
  12. Contractual compliance
    • Draft the licensing agreement in compliance with local and international contract laws.
    •  Clearly outline the rights, responsibilities, and obligations of the licensor and licensee.

Understanding and addressing these legal and regulatory aspects is crucial for a successful and compliant pharmaceutical in-licensing process. It is recommended to consult legal experts with expertise in pharmaceutical transactions to navigate these complexities effectively.

Safeguarding intellectual property

In the pharma industry, intellectual property is the cornerstone. Develop strategies to protect your IP, securing exclusivity and freedom to operate within legal bounds.

Proactive risk mitigation

Anticipate and address potential risks proactively. Develop contingency plans to navigate uncertainties, safeguarding your investment from unexpected challenges.

Seamless integration planning

Integration planning is about more than paperwork. Collaborate with internal teams to ensure a smooth transition of the in-licensed asset into your operations. Minimize disruptions and maximize efficiency.

Meticulous contract documentation

Detailed contracts are essential. Clearly outline terms, responsibilities, and obligations. Well-drafted contracts provide a solid foundation for a successful in-licensing partnership.

Internal stakeholder alignment

To develop a unified strategy for accomplishing your in-licensing goals, make sure that the departments of research, marketing, and legal are in sync with one another.

Post-license monitoring for continued success

Post-license monitoring is not an afterthought. Implement mechanisms to track the performance of the in-licensed asset. Regular evaluations empower you to make data-driven decisions for ongoing success.


In conclusion, understanding and applying key steps and best practices in the pharma in-licensing process is crucial for companies. It helps them develop products faster and stay competitive. By embracing external innovations wisely, businesses set themselves up for long-term success in the changing pharmaceutical industry, staying flexible and ready for challenges.

Credevo In-licensing services in Pharma

The development of great products often needs a collaborative effort. Credevo’s In-licensing support is all about connecting with excellent products, and developers worldwide.

With Credevo’s global network of companies engaged in the development of new products or those looking for new products to invest in, it becomes easier to find such attractive opportunities.

Credevo offers its services in the United States, Canada, Europe, Australia, Japan, China, South Korea, and many other regions globally.

Click here to explore the licensing services of Credevo

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