Biotechnology Companies Have to Insure against Failures in the Research & Development Stages
Both biotechnology and pharmaceutical companies are feeling the pressure created by the immense hype around the biotechnology industry. Its extraordinary popularity creates unreasonable expectations, wherein even common molecule failure in the research and development (R&D) stages result in loss of both investor confidence and funds for further research. Such unrealistic expectations can be especially crippling to new companies. The biotechnology sector will suffer more than pharmaceuticals, as it does not have many established companies that can absorb the burden of failed ventures. If you are interested in a virtual brochure, which provides manufacturers, end users, and other industry participants with an overview of the Cost Benefit Analysis of Research and Development of Top 10 Biotechnology Companies, then send an e-mail to Melina Gonzalez, Corporate Communications, at [EMAIL PROTECTED], with the following information: your full name, company name, title, telephone number, fax number, and e-mail address. Upon receipt of the above information, an overview will be sent to you through e- mail. As a drug moves through more advanced stages of R&D, the losses associated with failure will tend to naturally increase. To counter this situation, biotech companies could enter into licensing deals and implement risk management solutions. The industry trends point toward an increase in such deals and partnerships between companies. By sharing the risks and profits, they can eliminate or decrease the jeopardy associated with failures. "The partnerships between big pharma and biotech companies are likely to be the trendsetters in the industry," says Frost & Sullivan Research Analyst Barath Shankar S. "With the technical expertise of biotechnology companies and the marketing skills of big pharmas, the collaborations are expected to be very successful." Such strategic moves and plans have seen the top ten biotechnology companies in the United States have 186 products in R&D, and of these, nearly 20 percent are in phase III of development. These products are likely to have substantial impact on market growth in the next two to three years. The biotechnology industry is optimistic about market growth despite the recent spate of drug recalls, which wiped out billion's of dollars of market capital. Since the fundamentals of product development are sound, the companies are confident of overcoming these setbacks and accelerating growth. This positive attitude is a huge advantage in the biotechnology industry, since it thrives on risk taking. From 1994 to 2005, the top ten companies have returned an exceptional figure of close to 27 percent on stock price appreciation. In the next year, this number is expected to reach 24-25 percent, despite a few setbacks. Established companies such as Amgen, Chiron, Genentech, and Genzyme are expected to continue leading the market. Such high returns from biotechnology stocks are likely to sustain investor interest in the industry and maintain focus on new R&D projects. "Biogen IDEC, which has delivered the highest returns of 43.5 percent from 1994 to 2005, has a risk rating of 'moderate/high'," says Barath Shankar. "Similarly, Gilead which has returned 29.5 percent, much above the industry average, has the highest risk rating of 'very risky'." Cost Benefit Analysis of Research and Development of Top 10 Biotechnology Companies is part of the pharmaceuticals and clinical diagnostics subscription and examines the risk-return and cost- benefit profiles of research and development of the top ten biotechnology companies in the United States. The study incorporates a model to evaluate and provide an outlook for each of these companies. It also analyzes the possible blockbuster products in the product pipelines. Analyst interviews are available to the press. Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community, by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics. 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