Risk management framework for pharmaceutical research and development projects

Abstract

Purpose The purpose of this paper is to identify best practices from high‐technology industries that face many of the same challenges around uncertainty, complexity, and risk that are faced by the pharmaceutical industry. Design/methodology/approach This research has conducted an extensive review of risk management literature and research conducted in high‐technology industries to collect some of the key best practices for high‐risk research projects. Findings A literature review of recent risk management publications from three high‐technology industries yielded 13 best practices in project risk management that could potentially be applied to pharmaceutical R&D projects to improve managing risks and uncertainties of managing projects. By reviewing these lessons learned from industries that share many of the challenges of the pharmaceutical R&D projects, it is suggested that the implementation of risk management in the context of drug development projects will require adaptation to the specific needs and challenges of those projects. Research limitations/implications Implementing a risk management process is very challenging for pharmaceutical R&D projects, as there are high degrees of complexity, uncertainty, and large amounts of resources at stake. Many of the techniques could be applied to all stages of drug development, but some are clearly most applicable to particular stages. Some will work for small, medium and large pharmaceuticals, though the way they are implemented should be modified to meet the needs and resources of the particular company. Practical implications This study will serve as a basis for exploration and discussion that will result in controlled application and experimentation with these approaches, and this in turn could lead to real improvements in the use of risk management in pharmaceutical companies. Originality/value An exploration of the methods they have employed to address risk in R&D projects, as well as the outcomes of the application of those methods, should reveal tools, techniques, processes, training, and approaches that can be effectively applied to pharmaceutical development projects, and support the value of spending resources to employ risk management practices.