Navigating the Biopharma Finance & Accounting Tech Landscape from Pre-Clinical to Commercial Success

The biopharma industry is both exciting and challenging, especially when it comes to handling finance and accounting as companies move from pre-clinical to commercial stages. As your company grows, your financial needs become more complex. It’s important to understand the key tech considerations at each stage of your journey. Whether you’re just getting started or gearing up for a commercial launch, having the right tools and strategies is crucial for success.

To gain deeper insights into these topics, I encourage you to watch our joint on-demand video with Auxilius hosted by industry experts. The webinar covers detailed discussions on finance and accounting tech decisions tailored to different stages of biopharma companies.

The Pre-Clinical Stage: Laying the Groundwork

In the early days of a biopharma company, the focus is more on innovation and proving concepts. At this stage, most companies rely on simple and cost-effective financial solutions like QuickBooks. It’s familiar, inexpensive, and gets the job done. However, as you edge closer to significant milestones like IPOs, the limitations of such basic systems become evident. QuickBooks works well for initial needs due to its simplicity and ease of use, but as your operations scale, you require more robust controls and comprehensive reporting capabilities. This shift often necessitates moving to a more sophisticated system like NetSuite or Microsoft D365 to manage the increased complexity.

The Clinical Stage: Scaling and Managing Complexity

As your company progresses to the clinical stage, financial management becomes more intricate. You’re dealing with multiple clinical trials, significant R&D expenses, and rigorous regulatory requirements. A basic financial system can no longer meet your needs efficiently. This is where ERP systems like NetSuite come into play. This system provides advanced functionalities such as multi-entity management, real-time financial reporting, and robust compliance features, which are essential as you prepare for commercialization.

Transitioning to NetSuite

Moving from QuickBooks to a full-fledged ERP system is a big leap, but it’s crucial for managing the financial complexities of clinical trials. These ERP systems offer tools for accurate accruals, budget management, and vendor accountability, ensuring compliance with regulatory standards and reducing the risk of errors.

Example: Handling Clinical Trial Financial Management (CTFM) Manual processes for managing clinical trial finances can lead to inefficiencies and inaccuracies. An ERP system like NetSuite automates these processes, providing tools for precise financial tracking and reporting, which is vital as the stakes increase.

The Commercial Stage: Optimizing Operations

As your company transitions to the commercial stage, the focus shifts to optimizing operations. You’re now generating revenue and managing a global supply chain. Your ERP system must handle increased complexity and scale effectively. Key capabilities at this stage include inventory and supply chain management, revenue recognition, and global compliance.

Key Capabilities for Commercial Success

1. Inventory and Supply Chain Management: Efficiently managing inventory and coordinating with CMOs and 3PLs is vital.
2. Revenue Recognition: Accurately calculating and reporting revenue, including handling gross-to-net adjustments, becomes crucial.
3. Global Compliance: Ensuring compliance with international regulations if you’re operating across multiple countries.

Example: Using NetSuite for Commercial Operations NetSuite’s capabilities extend to managing complex inventory and supply chain needs, making it an ideal solution for biopharma companies scaling their operations. Its integration capabilities with third-party logistics providers ensure real-time visibility and efficient management of your supply chain.

Auxilius: Bridging the Gaps in Clinical Financial Management

Even with a robust ERP system, gaps remain, particularly in clinical financial management. Auxilius is designed specifically for life sciences, helping companies streamline period close processes, manage clinical R&D accruals, and maintain accurate budgets.

Why Auxilius Matters

Auxilius addresses the unique challenges faced by biopharma companies, providing tools tailored to the intricacies of clinical financial management. By integrating with your existing ERP system, Auxilius enhances your ability to manage clinical trial finances efficiently and accurately.

Example: Streamlining Clinical Trial Accruals Manual processes for managing clinical trial accruals are prone to errors and inefficiencies. Auxilius automates these processes, ensuring accurate and timely financial reporting. This not only reduces the risk of compliance issues but also frees up your finance team to focus on more strategic tasks.

Strategic Considerations and Future Planning

Regularly assessing your tech stack is critical to ensure it meets your evolving needs. Conducting an annual review of your systems can help identify gaps and opportunities for improvement. This proactive approach allows you to stay ahead of the curve and adapt to changes in the industry.

Questions to Ask During Your Tech Review

1. Can our current systems handle our projected growth?
2. Are we leveraging all the functionalities of our ERP system?
3. Do we need additional point solutions to address specific needs?
4. How well are our systems integrated?
5. Are we prepared for future regulatory changes?

Next Steps

Navigating the biopharma finance and accounting tech landscape is a journey that requires careful planning and strategic decisions. By understanding the specific needs at each stage of your company’s growth and leveraging the right tools, you can ensure financial stability and compliance, paving the way for successful commercialization. Keep evaluating your tech stack, stay informed about industry advancements, and don’t hesitate to seek expert advice to keep your company on the path to success.