A small firm may have its future fixed to one product or a cluster of related products and either thrives or dies on its success. A large firm diffuses the risk and funds failures from successes. As long as a small firm can raise funds, it will continue decision-phase research to reap the greatest value when it strikes a deal with a partner to harvest the value. Unfortunately, when the product begins to pale, fund raising becomes more difficult.

Another reason for synergy among large and small firms is that only the large firms can afford asset-intensive combinatorial and computational chemistry, high-throughput robotic screens, process and pilot plant chemistry, and manufacturing excellence. However, the frontier of biology moves quickly and at low cost into genes and gene products. Small companies linked with academia can exploit inexpensive biological tools to move rapidly through these emerging technologies to select biological targets suitable for screening with chemical libraries.

Surely this can be the magic of large company chemistry and small company biology, if these collaborations can be braided elegantly into thoughtfully planned and efficiently executed projects. Such collaborations in discovery can be fashioned to use the more risk-neutral and risk-diffusing large enterprise to help buoy the smaller, more fragile enterprises.

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