Located on an oceanfront isle at the Eden Roc Renaissance Hotel, BioNetwork East 2012 is an elegant yet intimate retreat for business development executives from world-class organizations in the biopharma industry to explore opportunities in partnering and funding.
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The latest pharma news is that the biotech business models of the past are no longer sustainable. Sixteen new biotech issues debuted on the market only to fall 13.2 percent by the end of Q3 2011. Some companies saw big gains, but some larger companies fell as much as 23 percent. Pharma market research anticipates a choppy market, but pharma companies continue to invest heavily in biotech innovation.
Some biotech firms run on the technology platform model. These startups rent or sell their products to big pharma companies. If the perceived value of the technology is high and the technology has intellectual property protection, then pharma companies are more likely to invest. However, once a new technology usurps the startup's offering, investment dollars usually dry up quickly.
A royalty income pharmaceutical company researches and licenses a new drug before selling it to big pharmaceuticals on the condition that they receive royalties from the sales. Typically, the RIPCO startup takes the drug through the initial states of research before selling it to the larger company. Investors in these types of companies look to see how quickly the drug can get to market as well as how large the market for the drug will be.
Some startups launch their own drugs. The fully integrated pharmaceutical company pushes its product all the way through the value chain, starting with initial research and ending with bringing the product to market. Few FIPCO companies are successful because of the large amount of capital required to fuel this strategy. Investors may have interest in a FIPCO if the market for the drug will be large enough and if the startup has other drugs in the pipeline to diversify risk.
The no research-development only approach takes a drug that big pharma has discarded and works to develop the drug in a cost-effective and efficient way. NRDO startups need access to molecules and drugs on a regular basis in order to remain profitable. Also, NRDOs need to maintain speed and competitive advantage throughout the production process.
Investors of the future, according to pharma market research, will be more interested in companies that keep more of the risk in-house. Investors will also be looking to companies that have their eye on emerging markets. The most interesting pharma news is that biotech companies raised as much money in 2009 as they did in 2010, a miracle considering today's challenging economic environment.