The latest issue of <<Nature Drug Discovery>> (issue 8, 2009) published an Editorial by John Dixon et al., with a rather provocative subject. In contrast to the trends of large M&A’s among big Pharmas in a rush to become world’s largested integrated company that we have seen since eary this year, the authors virtually announced that such business model has failed. Instead, they suggested the pharmaceutical industry should go the opporsit diretion to become disintegrated “vertically” to increase efficiciency and productivity. According to the proposal, the pharma industry should be disintegrated into largely three pieces: discovery, development and marketing. Companies should be “specialized” on one but not all stages of drug R&D and look for partners or buyers to complete the process. There are a couple of fundamental reasons to support this model. First, VC market would more likely be able to support a company of smaller size with clear focus. Secondly, product from a company, either a drug candidate or a new technology, would have more chance to find its matching partner or buyer in an open market, than “asvocateing” internally for various reasons.  “Desintegration” is not a new idea, people questioning the productivity of large pharmas have been advocating for such model for some time. Some large pharms, such as GSK, are also expreiementing such idea by creating an “internally” disintegrated structure to promote more innovation. Whether a disintegrated pharma industry will be more productive remains to be proved. Meanwhile, thousands of new “start-up”s are doing exactly the same as the authors proposed: being specialized on one area and taking products to the market by collaboration or transactions. That has in fact created a “vetically disintegrated” industry alone with the integrated large pharms. Before closing this blog, it will be of interest to point out that, in a “vertically disintegrated” world, one will see more integration of drug discovery and service which is not seen in integrated companies. Smaller companies would maximize their “experties” by developing its own products while providing service to other non-competitive companies. Alone with that, there will be increasing need for CRO services.