Biotech & Pharma: Jackson Library: Stanford GSB

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Hot Topics: Biotech & Pharma

The cost of producing a marketable drug or medical device has skyrocketed in recent years. The biotech and pharma industry tops R&D spending among all industries. The financial market for biotech and pharma as a whole are very solid, however many stocks are very volatile and the market responds extremely poorly to bad news.

The selected articles below report the major issues facing the industry, and market outcome of biotech and pharma companies. For background information, check the selected Recent News and Web Sites.

Selected articles

Due to contractual arrangements, access to some articles may be restricted to the Stanford community, and subscribers of the "Library Databases" offered through the GSB Alumni's Lifelong Learning Program. Inclusion below does not imply University endorsement of the ideas expressed.

Increased Biotechnology Funding Boosts U.S. Drug Discovery Contract Research Organization Markets. Business Wire India, March 9, 2007
New analysis from Frost & Sullivan, U.S. Drug Discovery Contract Research Organization Markets, reveals that the market earned revenues of $7.44 billion in 2006 and is likely to reach $19.35 billion in 2013.
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Sector Snap: Biotechnology. Forbes.com, March 1, 2007
Biotechnology company shares fell Thursday with the rest of the market as the Dow Jones Industrials average shed more than 200 points before recovering.
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Big Cities Tops for Bioscience Jobs. Inc.com, February 26, 2007
In 2004, 1.2 million people worked in the bioscience industry at more than 40,000 businesses. While bioscience firms were located in almost every state, the top locations for employment in the biosciences are New York and Los Angeles, according to the study prepared by Battelle on behalf of the Biotechnology Industry Organization.
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A 2001 Genentech Biotechnology Patent is Revoked. International Herald Tribune, February 22, 2007
The U.S. Patent and Trademark Office has revoked a fundamental biotechnology patent held by Genentech, the biotechnology company that was at the center of a recent U.S. Supreme Court decision. The patent office's decision could cost Genentech hundreds of millions of dollars in royalties over the next decade.
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Drugmakers' 'Arms Race' May Spur Biotechnology Deals. Bloomberg, January 12, 2007
The number of biotech deals, including acquisitions and product alliances, rose 32 percent to 232 last year, according to data compiled by Bloomberg.
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Beyond Borders: Ernst & Young's Global Biotechnology Report 2007 Ernst & Young, 2007
At 31-years old, biotechnology has reached a point where it has "come of age" and now it's on to the maturing years. We've seen evidence of strengthening pipelines, revenue growth, and progress towards profitability. This is often when challenges emerge that are the result of success. Challenges born from the convergence in time of innovative new products, newly profitable companies, and escalating regulatory challenges. Order Free Report

Too Little Bang for the Buck in Drug Research. Time, December 27, 2006
A new government report spotlights an apparent lack of productivity in Big Pharma's pipeline. Whenever critics complain about the high cost of prescription drugs, the pharmaceutical industry's standard defense is that companies have to plow so much money into researching innovative new medicines. A recently released report from the Government Accountability Office casts doubt on that rationale. Yes pharma is spending heavily on R&D, but it isn't actually generating such a good return on investments.
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Bitter Pill. The Deal, December 1, 2006
Deaths from bad drugs are nothing new in China. On the surface, China looks to be one of the worst possible places for foreign pharmaceutical investment. Really, it could just be one of the best. China's population of 1.3 billion and emerging-market status are huge lures for multinational companies, especially drugmakers. China's drug market is expected to be worth $24 billion by 2010, according to Boston Consulting Group, and it is now the ninth-largest drug market in the world.
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The Average Cost to Develop a New Biotechnology Product is $1.2 Billion, According to the Tufts Center for the Study of Drug Development. PharmaLive, November 9, 2006
Tufts said the $1.2 billion estimate reflects the costs of drugs that fail in testing and the time costs associated with bringing a new biopharmaceutical to market. Of this amount, capitalized out-of-pocket preclinical cost totaled $615 million, while similar clinical period cost totaled $626 million.
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Can Science Be a Business? Lessons from Biotech. Harvard Business Review, October, 2006
Overview of the business model used for the biotechnology industry and the viability of an industry that is based on other business models, such as the software industry, and whether a for-profit scientific industry stifles research that is not commercial enough. Few companies have been lucky enough to produce the blockbuster drugs needed to sustain income.
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Mind to Market: A Global Analysis of University Biotechnology Transfer and Commercialization. Milken Institute, September 20, 2006
Three decades have passed since researchers from Stanford and the University of California, San Francisco began to develop the commercial applications for their work on recombinant DNA and launched the birth of the biotech industry. Research and innovation are increasingly shifting away from the corporate lab and back to where they began: the university campus.
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Chinses Pharma-Biotech Dragon Rears Its Head. Wisconsin Technology Network, September 11, 2006
Looks specifically at what is happening in China that might have an impact on the U.S. in the near future.
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Big Pharma's CEOs: The Big Winners and Big Losers. CNN Money, August 22, 2006
A look at how the nation's top drug outfits have performed since their respective CEOs took the helm.
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Ariad v Lilly, Part II: The next big patent battle biotech's legal victory over larger drugmaker could be fleeting, experts say. CNN Money, August 4, 2006
The bell's about to sound for the next round in a patent fight that the entire pharmaceutical industry is watching.
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As Biotechnology Turns 30 Years Old, Industry Lies at a Crossroad. Midwest Business, July 31, 2006
The first major biotech company started: Genentech in April 1976. How does this compare with the pharmaceutical industry? A number of American and European pharmaceutical companies started in the second half of the 19th century.
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Biotechnology in Europe: 2006 Comparative Study. European Association for Bioindustries, 2006
This report compares the biotechnology sectors across some eighteen European nations and the USA, and takes an in depth look at the biotechnology sector in Germany, France, Switzerland, UK and the USA.
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Big Pharma Thinks Small Merck, Pfizer Among Companies Ramping Up Licensing Deals With Smaller Biotechs to Beef Up Pipelines. CNN Money, March 23, 2006
With $100 billion worth of branded drugs losing patent protection in the next five years, Big Pharma needs new drugs -- and licensing from smaller companies is proving to be a cheaper, less risky way of securing potential products than buying those companies outright.
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IMS Health Reports Global Pharmaceutical Market Grew 7 Percent in 2005, to $602 Billion. IMS Health, March 21, 2006
Emerging Markets in Asia, Latin America and Eastern Europe Gain Strength as Patient Access to Prescription Drugs Improves. Emerging markets including China, Korea, Mexico, Russia and Turkey, all experienced double-digit growth, outpacing global performance and signaling important shifts in the marketplace.
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Businessman offers $100 million for biotech if state will match funds. The Business Journal of Phoenix, February 27, 2006
A real estate developer is pledging $100 million to help attract biotechnology investments and research to Arizona but wants the state government to match that private gift with a $150 million investment.
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BayBio reorganizing to bolster lobbying for biotech industry. Silicon Valley/ San Jose Business Journal, February 3, 2006
Determined to gain a bigger voice in government, life sciences association BayBio is re-organizing so that it can spend more time and money to advocate for its industry.
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Biotech Bets. Business Week, December 26, 2005
Just six months ago gloomy biotech executives used terms such as "nuclear winter" at an industry conference to describe how poorly their stocks were performing. But that has changed.
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From Orphan to Blockbuster. CNN Money, July 8, 2005
Biotechs lead the way in getting orphan drugs to market, and sometimes they actually make money.
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Local biotech industry joins $1bn club in '04-05. The Economics Times, June 11, 2005
Corporate India is bitten by the 'billion' bug. While a slew of companies has posted billion dollars in top lines in the recent past, especially from the IT industry, it is now the turn of the biotech sector.
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What are America's Top Biotech Centers? Milken Institute June 7, 2005
In the race to generate high-paying jobs and underwrite local prosperity, regional leaders from across the United States are fighting hare to lure what many believe is the economic growth industry of the 21st century.
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Biotech profit still distant. San Francisco Chronicle, June 1,2005
Although biotech innovations continue to drive progress in the pharmaceutical industry and a few heavyweights like Genentech Inc. rake in millions in profits, the sector as an aggregate will continue to register net losses until the end of the decade, according to an annual financial report card issued by Ernst & Young.
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Biotech's hype and hope yielded losses. Associated Press, June 1, 2005
The biotechnology industry lost a combined $6.4 billion last year, according to a new report from Ernst & Young. The industry's total accrued loss since its birth in Silicon Valley in the mid-1970s is more than $45 billion.
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Global Pharmaceuticals & Biotechnology: Industry Profile. Datamonitor, May 2005
Despite lower growth rates in 1999-2003 the pharmaceutical and biotechnology industries have shown marked improvement since. As an immature market many of the major players in biotechnology are comprised of big pharmaceutical companies. Includes market statistics.
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Reducing Risk with "No Research, Development Only" Approach. Genetic Engineering News, Apr. 4, 2005
As the pharmaceutical industry continues to experience regulatory troubles, lackluster returns, and other setbacks, some disappointed investors may be shifting their focus from pharmaceutical companies to biotechnology companies.
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Where VCs Fear to Tread. Business Week, Mar. 7, 2005
Reports that "angels" or rich private investors are filling a critical gap by providing early backing for biotechnology companies.
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Tracking The Progress of RNA Drugs. Signals, Mar. 3, 2005
Since the turn of the year, companies involved in developing RNA-based therapies–either directly or indirectly–have been flooding the newswires with one announcement after another.
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Manic Investing. Boston Globe, Mar. 1, 2005
Biogen Idec Inc. stock fell so hard yesterday it could have left a crater.
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The Rise and Fall of Pharma Reputations. Pharmaceutical Executive, Feb. 1, 2005
In the 2004 insider survey, some Big Pharmas lost ground while fast-moving biotechs shot to the top.
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Outlook 2005. Tufts Center for the Study of Drug Development, Jan. 2005
The productivity and quality improvements are indisputable R&D mandates for drug and biotech companies, whether located in the United States or abroad.
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Biotech R&D Still Reeling. Nature Biotechnology, Sept 2004
Double-digit growth in R&D budget (typically about one-quarter of revenue) is common at large biotechs; small firms are building smaller R&D budgets at an even brisker pace.
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Page updated by: Helen Losh