During the project, we visited sites in the UK, US and Europe, in addition to site visits to the licensing partner. It is worth noting that our remit excluded a review of the business case.
The primary focus of any technical due diligence assignment is to confirm that the technology meets the licensing partner’s claims and that there are no ‘show-stoppers’ – issues which would prevent the client from pursuing the technology.
We explore whether the client understands what challenges remain, what the target company will be like to work with and additional concerns.
In this case, we set out on the due diligence approach aware of a key limitation for inhaled insulin – titration.
Insulin pens allow patients to titrate, by which they can measure and adjust the dose they need to deliver. When considering the new technology, it was clear that inhalable insulin would not be able to offer the same flexibility. This was important to discuss with the licensing partner and our client, to help outline potential device strategies to address this known limitation.
The due diligence process concluded that the combination product met the majority of the claims made by the licensing partner, though we did identify a number of both high and medium risks – areas that required further effort in the early stages of the proposed collaboration.
Our due diligence team felt that, with the appropriate oversight, the combination product would meet our client’s requirements in terms of development/unit cost and time to market.
Following the due diligence exercise, we were commissioned to provide ongoing oversight and technical support in the development of the medical product, as well as monitoring competitor products. Interestingly, this was halted only a few years later due to lower-than-expected sales for the predicate product.
What was the cause of this drop in market interest and how did it shape the future of inhaled insulin?