Bigger and Better or Bolt-on—Perspectives from BioPharma

Annual Meeting Session Recap

By Christine T. Fischette, Ph.D., Fischette Consulting, LLC and Griffin Securities, Inc.

For the few years prior to 2013, biotech companies who sought further capital mostly were relegated to one path - BioPharma M&A/Licensing - considering the freeze on biotech admissions to the capital markets. This situation allowed BioPharma to decrease its risk by focusing largely on compounds that attained proof of concept data, or by selecting companies with unique platform technologies that could quickly generate lead compounds. 2013 changed the playing field as 100+ private companies filed an IPO since then. The discussion explored how BioPharma views the changes in the playing field, and how they plan to enhance their own growth by acquisition and/or organic growth. Consensus was that BioPharma does indeed recognize that their available licensing/M&A opportunities will and do tend to be later stage and therefore more expensive as a result of more companies pursuing the IPO option and advancing their development candidates. Be that as it may, Biopharma still has a clear individualistic strategy based on what each company perceives as the best way to achieve the dual requirement of meeting unmet patient need and significant commercial/shareholder return. Although some things do not change, i.e., all Big BioPharma companies look for the next brightest star on the therapeutic horizon, usually characterized by specific therapeutic area/disease area of interest, novel MOA/platform, market/patent exclusivity, significant patient benefit with minimal safety considerations that will ensure a receptive audience by payers and thus formulary access, reimbursement and “best case” net sales, the way each company implements that strategy is unique to each organization.
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