Since the advent of cost-effective high-throughput techniques applied to genomics, transcriptomics, proteomics and other types of “omics”, the amount of biological data is increasing at an astonishing pace (NHGRI-NIH, Stephens et al. The major driving force of the surge is the application of this big data in drug discovery and the development of new disease detection methods. The resulting fast-growing market (Contract Pharma, Grand View Research) attracts the attention of many biotech start-up founders and investors. However, though generating own data or getting data from external resources is getting easier, the data themselves are not worth much until someone with bioinformatics expertise analyses them and extracts all relevant insights.
For a biotech start-up in need of such bioinformatics services, there are four primary options:
- working with a university bioinformatics group
- contracting a bioinformatics freelancer
- outsourcing bioinformatics to a specialized consulting company
- employing an in-house bioinformatician
Let’s explore the pros and cons of each of these options.
Collaboration with a University Bioinformatics Group
From a financial point of view, outsourcing a bioinformatics project to a university is the most enticing option. In this type of collaboration, it is the knowledge gained from the project that usually pays the bill. However, academic research and industrial research are not always aligned regarding the vision of what can and should happen with the findings. Typically, the goal of academic research is to publish the results and make them openly accessible to the scientific community. On the contrary, start-ups might want to keep the results confidential to secure their competitive advantage and capitalize on this exclusiveness going forward.
To make sure that there are no conflicts of that nature after the collaboration starts, it is essential that both sides sign a formal agreement as to who owns the IP rights and how the results can be used. It is worth considering reaching out to the technology transfer office of the university and engaging a lawyer with the required expertise.
As start-ups work under huge time pressure, it is also important that they seek an agreement with the university group regarding the schedule, deliverables, and deadlines. One of the aspects that can play a critical role here is the person who will be performing the analysis. What is their bioinformatics expertise level? Is it an experienced bioinformatician who knows what and how or a student who will be learning on the project? How broad is their knowledge, for example, are they specialized in a narrow subject matter and thus will need extra time to research potential other topics when they appear in the development process? How much experience do they have working in a business context, where a pragmatic, time-conscious, and result-orientated approach is needed? Transparent and open communication upfront and the incorporation of ideally all of these considerations in the formal agreement will make the collaboration more structured, serious, and safer for both sides.
In summary, outsourcing a start-up’s bioinformatics project(s) to a university group might be an interesting option for small, initial projects, in the phase of testing opportunities with a very limited budget. It might take time to establish a proper collaboration backed by a formal agreement, therefore start-ups on tight schedules and racing for funds should consider this option with caution.
Working with a Bioinformatics Freelancer
Bioinformatics freelancers offer another option to consider for a biotech start-up in need of bioinformatics expertise. The cost and quality of a service provided by a bioinformatics freelancer will depend on his/her experience. If their previous projects were in a domain targeted by a start-up, it is highly likely that they will be able to start carrying out the task at hand fairly quickly and will deliver good-quality results. Moreover, if they worked with other companies, their understanding of how the business world works can make the start-up’s team life easier, especially in the case of projects with tight deadlines. The advantage of getting the job done efficiently requires however investing time and effort to find a freelancer with fitting expertise domain and enough professional experience, preferably backed up with solid case studies. Moreover, though expert knowledge and practice in a narrow topic are important, larger and more complex projects are likely to evolve, requiring know-how of other tools, techniques, etc. In that case, a start-up might soon find itself in urgent need of another or additional specialist.
To sum up, working with a bioinformatics freelancer is an interesting option for rather small and short projects on a specific topic, in which getting the results soon is important. In such a case, both sides can benefit from the flexibility that this setting offers, without putting at risk critical core projects if, for example, the freelancer prematurely pulls out of the collaboration. Also start-ups with a bioinformatician in their team, but lacking some expertise or a helping hand to speed up the work, are likely to benefit from freelancers’ service.
Outsourcing Bioinformatics to a Consulting Company
A well-structured team of specialists is what provides several important benefits to start-ups that outsource their bioinformatics projects to consulting companies.
Both selecting the right specialists to take on a project as well as kicking off the formal partnership happen faster and more efficiently with a company that, besides the technical experts, has also team leaders and account managers who facilitate the process. Consulting companies with a good team structure and standard workflows are therefore able to provide a professional service to their business partners, independently of how big, complex and urgent a project might be. If in the course of work the project develops and demands other types of knowledge, tools or techniques, it can be smoothly continued by a specialist with corresponding expertise. Moreover, since experts working in a team have the opportunity to share their experiences and novel insights internally, and learn from each other, they can also identify new opportunities and therefore proactively help a start-up to get ahead of its competitors.
Quality service, professional approach and security assured by a consulting company reflect however in the service cost which is usually higher than that of a freelancer’s service (note, however, that rates vary both between different consulting companies and between different freelancers). On the other hand, consulting companies that work with various customers have often ready pipelines and software tools that they can easily customize and apply to a start-up’s project, speeding up the projects and lowering costs as the tools do not need to be developed from scratch.
In summary, outsourcing a bioinformatics project to a consulting company benefits especially large and complex projects that are at the core of a start-up’s strategy. If such a project is urgent and time-limited, a consulting company will most probably propose to engage a suitable expert(s) full-time. In the case of highly complex long-term projects that can be successfully realized part-time, the service of a consulting company will typically be still the most cost-efficient and reliable in comparison with other options.
*Pro tip*: If you are not sure how your start-up can benefit from outsourcing its bioinformatics project(s), ask a consulting company to design and perform a pilot project for you. Its smaller scale will mean a relatively low cost, while you’ll be able to test the service and already get some work done. Several of our customers started working with us in this way and now we keep on assisting them in their critical large-scale projects.
Hiring In-House Bioinformatician
If the R&D of a start-up will require continuous and full-time support from a bioinformatics specialist, hiring one is the most reasonable and cost-efficient option in the long run. In this case, it is important to start looking for a candidate as soon as possible, because good specialists are intensely sought after and the hiring process will likely take a significant amount of time and effort. Less experienced candidates might be easier to find but will probably need some onboarding and training time before they start delivering results. The competition for talent not only makes it difficult to hire good candidates but also to keep them. Moreover, just as in the case of a freelance service, the knowledge and expertise of a hired specialist might not suffice as projects evolve and new topics and opportunities occur.
An interesting tactic that start-ups with long-term bioinformatics R&D consider is *teaming up with a consulting company to get the project set up and rolling while they look for a specialist to hire*. There are several advantages of this approach. First, the start-up has time to find and hire the right person. Second, once the new team member is there, they can work alongside the consultant(s), combining their expertise with training from the consultant and getting up to speed with reliable support to ultimately take over the lead in the project(s). Third, the established relationship with the consulting company can be of great value going forward when the start-up will go into new venues or will simply need extra hands-on help as the projects evolve and expand.
Hiring an in-house bioinformatician makes the most sense if bioinformatics will be an inherent part of a start-up’s R&D and will require full-time bioinformatics support. If a continuous but part-time is needed, then a consulting company might be a more cost-effective option. Hiring an in-house bioinformatics specialist is the most binding option and therefore carries the highest risks for the start-up, but these risks can be mitigated if paralleled with the support from a consulting company.
To sum up this topic, biotech start-ups looking for bioinformatics experts should consider what type of partnership will be best aligned with their current situation, business roadmap, and types of projects they have in planning.
If you are in doubt about what type of bioinformatics expertise source will benefit your start-up’s project, get in touch with us. After working on all types and sizes of projects and with different companies and institutions, we can give you some useful pieces of advice fitting your situation.