The Future of Biotechnology for Medical Applications in 2015

Introduction

This page will contain the results of the scenario planning process of group 4 of class RSM EMBA05 on the following subject:

The Future of Biotechnology for medical application 2015

Scenario Topic

Biotechnology seeks to treat or even cure: Cancer, AIDS, hemophilia, hepatitis, diabetes, growth failure, heart disease, dermatology and autoimmune disorders. Over the last 20 years the biotech industry has grown from virtually none existing to a large industry with the two largest players having a market value around the 100 billion US dollar mark making them leading stocks on the Nasdaq exchange.

A definition of biotechnology is "the commercial application of living organisms or their products, which involves the deliberate manipulation of their DNA molecules" This definition implies a set of laboratory techniques developed within the last 20 years that have been responsible for the tremendous scientific and commercial interest in biotechnology, the founding of many new companies, and the redirection of research efforts and financial resources among established companies and universities. These laboratory techniques provide scientists with a spectacular vision of the design and function of living organisms, and provide technologists in many fields with the tools to implement exciting commercial applications.”
note to Frans: have to add reference

The strategic dilemma is where the industry is in the “industry life cycle”? Is the biotech industry going to keep showing a 30-50% growth rate per year in the next decennia or is the industry mature and will the growth be comparable with industries like CPG which grow rate is similar to parameters like the growth of the population, inflation or the GDP. Or, has the biotech industry reached its top and will the industry decline and perhaps disappear?

Driving forces that will influence the future state of the biotech industry include:
- What will happen with the political discussion around use of genetic knowledge to cure deceases. Will we allow the industry to clone sheep or will the conservative or religious point of view prevail which would handicap the industry to further grow.
- Is the significant growth of the cost for medical treatment sustainable? The cost of health care insurance, which is directly linked to the cost of medicare, has grown about 10% annually partly caused by the growth of the biotech industry. This cost growth does not seem sustainable so where does it end?
- Has the industry reached its technological peak or has the biotechnological development just started and will future new technologies allow the industry to further grow?
- How will the FDA and EMEA authorities respond to the exponential growth of the biotech industry and how ill their guidelines develop?