Pfizer, the largest pharmaceuticals company in the world and a Spigit customer, has launched a startup geared towards developing new treatments for underserved patient communities.
The six-person startup named SpringWorks Therapeutics will launch with an initial Series A investment of over $100 million. Investors include parent company Pfizer and Bain Capital Life Sciences.
What’s interesting about SpringWorks is their business model. Not only do they plan on dusting off Pfizer therapies such as treatments for rare forms of cancer, they plan on seeking out compounds (ingredients for drugs and treatments) from other pharma companies to license for further testing.
The reality for any larger company is that not every product, service, or drug in the case of Pfizer, will make it to market. Some will be shelved due to lack of resources for research and development, or a shift in the focus.
When it comes to innovation in healthcare and pharma, SpringWorks could be a catalyst for bringing new medicines and treatments to market that otherwise would have stagnated.
A growth trend in the enterprise
Pfizer joins a rapidly growing list of large, well-established companies betting on entrepreneurship by launching startups to tackle new problems. This is a step away from the traditional way companies of this size drive growth: acquisition.
If you look at a company like Google (circa 2015), they purposely restructured the company and launched Alphabet (their parent company) in order to allow divisions – like Google, X, and Sidewalk Labs – to operate independently. By structuring the company this way, Alphabet left room for new subsidiaries to be created in the future as opportunities surface.
Cambia Health Solutions is an example of a company that has recognized the benefits of launching subsidiary companies in an effort to drive transformation and innovation in healthcare.
Since it’s founding in 1999, with a history that dates back to 1917, Cambia has launched over 20 healthcare businesses. The most recent being MedSavvy, which was the brainchild of Sean Karbowicz – a former Clinical Pharmacy Director for Regence BlueCross BlueShield (a Cambia company) and now General Manager of MedSavvy. The company puts helpful, transparent medication information in the hands of consumers and prescribers using scientific-based evidence to grade over 1,000 medications covering 100 conditions.
With 13 businesses in its portfolio, ranging from aviation to venture capital, General Electric – like Cambia and now Pfizer – is another example of an established company driving growth by forming new businesses.
The list of companies goes on.
While the traditional route of acquiring companies to enter new markets and drive growth will always be an option, as Chris Zook, a partner in Bain & Company, points out in this Harvard Business Review article: “We may be seeing the rise of a new type of multi-business company.”
It’s said that large companies can’t move as fast as startups. While there’s some truth to this, there are three resources these companies have that many startups don’t: money, experience, and people.
As innovation continues to be what separates market leaders from the rest of the pack,
having those resources puts large companies in a perfect position to launch new startups and become disrupters of their own.