Consolidation of Biotech Industry

Description

The Biotech industry has seen a large number of start-up companies, and funding for R&D projects has been available from governments as well as from private sources. However, if Biotech companies are not able to deliver on their promises, funding will eventually drain. The companies that have not managed to create money generating products (or research) will face difficulties. The situation can very well be compared to the dot.com situation in the beginning of the millennium, which led to a major consolidation of the internet industry.

Enablers

• Start-ups running out of money
• Big pharmaceuticals trying to fill up their product pipelines
• Markets getting more mature
• Falling profitability of Drug Market
• Patents running out
• Cost pressure

Inhibitors

• Lower Cost of innovations (niches)
• Lower entry barriers (more and more basic research available)
• Cheaper skilled labour e.g. in Emerging Markets

Paradigms

Biotech is an industry like anyone else