Beyond Borders: Global biotechnology report 2010

To our clients and friends
As economies around the world begin to recover from the worst
economic crisis since the Great Depression, it is clear that a “new
normal” is emerging. Among other things, this is a world in which
capital flows are far more constrained than during the easy moneyfueled
decade that preceded the downturn. What impact has this
capital-constrained environment had on biotechnology — a business
that is based on an enormous hunger for capital coupled with an
exceptionally long path to commercial payback?
We set out to answer that question in this year’s Beyond borders.
As usual, we analyze key indicators of the industry’s performance:
financing activity, deal trends, financial results, pipeline strength
and product approvals. While the overall results are robust, the gap
between the industry’s haves and its have-nots has widened.
Our Global introduction article pulls together these trends and
assesses their implications for biotechnology companies. In
particular, we focus on new models and creative approaches that
companies and investors are taking to adapt to today’s challenging
economic climate. Accompanying our article are six Perspectives
for the new normal by leaders of companies that are using
innovative approaches to finance companies, raise capital, conduct
R&D and structure deals.
The common thread that runs through this discussion — indeed, the
mantra of the new normal — is the search for efficiency. In a time of
diminished means, key constituents in the biotechnology
ecosystem — investors, pharmaceutical companies, payors,
governments and biotech firms — need to do more with less.
Companies that are able to develop creative solutions to boost
efficiency will be best positioned to succeed in the new normal.
Readers of Beyond borders will notice some structural changes
in this year’s report. In prior years, we organized the report by
geography, with sections on the Americas, Europe and Asia-Pacific.
This year, we have instead organized the report thematically.
The Global perspective section brings together our point of view
on salient trends and implications as well as some perspectives
from company leaders. This is followed by a Country profiles
section, where we summarize key developments in countries with
developing biotechnology sectors. In the Industry performance
section, we analyze data from locations with established
biotechnology centers: the US, Europe, Canada and Australia. We
think this allows us to more appropriately analyze developments
in markets of different maturity and allows readers to more easily
access and compare thematic trends.
Ernst & Young’s life sciences professionals stand ready to help you
as you navigate the unprecedented challenges and opportunities
in the new normal.
Glen T. Giovannetti
Global Biotechnology Leader
Global Life Sciences Center
Ernst & Young
Gautam Jaggi
Managing Editor, Beyond borders
Global Life Sciences Center
Ernst & Young