|Biotechnology Technology Transfer|
|Business News - Press Release|
Trends in Biotechnology Technology Transfer to 2014
Biotech companies are increasingly seeking technology transfer arrangements because investor funding remains difficult to find as we emerge from the economic downturn, finds Business Insights*.
Karen Mostert at Business Insights, comments: "The biotech industry has expanded rapidly resulting in a growing pipeline of products and at the end of 2009 more than 3,000 products were in clinical testing and 7,000 were undergoing clinical evaluation. However, biotech companies rarely have saleable products and rely on investor cash to maintain operations. As a result many are turning to technology transfer arrangements to fund continued operations."This coincides with such deals becoming increasingly attractive to Big Pharma which is facing complicated and increasingly interconnected disease targets, escalating research costs, fewer in-house R&D resources, increased regulatory scrutiny and demand for more clinical data.
Karen adds: "In 2008 there were 53 biotechnology transfer deals for human medicines. In 2009 this number more than doubled to 123. However, many deals fail as a result of failure to conduct proper due diligence, poor deal structure, management changes or simply goals not being met on time or budget or an inability to meet key scientific goals."
The failure of biotechnology deals can have significant implications for both the technology developer and the sponsor, although consequences are usually more serious for the developer due to its often smaller size and greater reliance on a single revenue stream.
Karen concludes: "Despite the risk seemingly sitting with the biotech company, drug developers often seek out and acquire large numbers of new technologies and a high number of failures can in the long run greatly impact their competitiveness. As a result drug developers have developed best practice to reduce their exposure including the introduction of structured innovative deal terms and addressing international intellectual property challenges."
One consequence of this is drug developers more closely aligning the technology valuations with actual market potential. As a result Business Insights predicts that deal value growth is expected to decline.
Recommended report: Building Biotech Technology Transfer Opportunities | Sponsor and developer strategies for success
About Business Insights
Business Insights is a world leading publisher of industry and market insight across a wide number of industry sectors. Business Insights' analysis is designed to help clients make well informed and timely business decisions through the delivery of accurate, up-to-date strategic company and market intelligence.
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