Of 34 deals in the psychiatric disorder space since 2008, none have been mergers and acquisitions, but two-thirds of such transactions have involved licensing of compounds before regulatory approval. The major deals in the space have been a multi-compound collaboration between Otsuka and Lundbeck and the failed tie-up between AstraZeneca and Targacept.

With most Big Pharmas facing a steep and costly patent chasm and in-house R&D failing to produce the necessary bridge to patent-challenged franchises, companies have been forced to look for new sources of innovation beyond traditional in-licensing and acquisition. As a result, some drugmakers are looking with renewed interest at the innovation housed in universities. The tie-up between Johnson & Johnson and Vanderbilt University is just the latest example of this important trend.