The hidden deal breakers in licensing and due diligence

By Dr Irina Staatz and Eugenio Rizzello, expert trainers of Market Access Essentials for Business Development & Clinical Strategy

Why promising assets lose value and how Business Development & Licensing teams can spot the risks earlier

By the time a licensing deal reaches due diligence, most of the value narrative is already set. Or at least, that’s what many teams believe.

In reality, due diligence is often the moment when value assumptions are stress-tested for the first time through a market access lens and where seemingly strong assets quietly lose leverage.

Not because the science fails, but because reimbursement reality enters the conversation too late.
 

⚠️ When Good Assets Become Risky Deals

Many pharmaceutical and biotech assets look highly attractive in early BD discussions: strong mechanisms of action, encouraging clinical signals, clear unmet need. Yet during due diligence, partners frequently revise valuations, restructure milestones, or introduce conditional deal elements.

The reason is rarely a single “red flag.” 

Instead, it is the accumulation of market access blind spots that were underestimated early on. 

For BD teams, these blind spots matter because they directly affect:

• Upfront payments and valuation credibility
• Risk allocation across milestones and royalties
• Partner confidence in long-term commercial upside
   

🔎 The Most Common Hidden Deal Breakers

While each asset is unique, several recurring issues consistently weaken deal outcomes when uncovered during due diligence:

1. Comparator and Standard-of-Care misalignment

   Clinical programs often select comparators that satisfy regulatory expectations but fail to reflect real-world payer benchmarks. When relative value is reassessed against local standards of care, the asset’s differentiation may erode quickly.

2. Endpoints that don’t translate into reimbursement value

   Statistically significant results do not automatically translate into payer-relevant benefit. Endpoints that lack clear relevance for patients, healthcare systems, or budget holders often limit pricing and reimbursement potential.

3. Over-optimistic pricing and access assumptions

   Early valuation models frequently underestimate national pricing controls, reference pricing, and budget impact constraints. These realities surface during due diligence, triggering re-pricing and downward pressure on deal terms.

4. Unclear or overly broad target populations

   Assets positioned for broad populations may ultimately face restricted reimbursement. When HTA bodies narrow the reimbursed population, peak sales projections and deal value can change dramatically.

5. Missing or late Health Economic evidence

   A lack of early cost-effectiveness or budget impact logic weakens the value story. Partners compensate by applying conservative assumptions, shifting risk into milestones or lowering upfronts.
    

✅ What Strong BD&L Teams Do Differently

The most successful BD&L organisations don’t treat market access as a post-deal or late-stage issue. Instead, they use it as a strategic tool to strengthen negotiations.

They:

• Pressure-test value stories using payer and HTA logic early.
• Integrate market access insights into asset screening and valuation.
• Align BD, clinical, and market access teams before due diligence.
• Anticipate reimbursement risks instead of discovering them in negotiations.

This approach doesn’t eliminate risk… but it prevents surprises that quietly reshape deals!
 

🎯 Turning Insight into Deal Advantage

Market access will always influence licensing outcomes. The difference is whether it appears as a late-stage obstacle or as a source of strategic clarity and deal leverage.

In the Market Access Essentials for Business Development & Clinical Strategy course, participants work through real-world examples showing how these deal breakers emerge, how they affect valuation and contract structures, and how BD teams can identify and mitigate them early… before they impact negotiations.

Because the strongest deals are built on value stories that hold up where it matters most: at reimbursement.