“How are we doing? It’s tough.” That’s what G. Steven Burrill, CEO of Burrill & Company, said at the outset of his talk to a fully packed room at the 2012 BIO International Convention Super Session featuring an overview of the 26th annual Burrill State-of-the-Industry Report.
The report’s main finding was that the biotech industry is changing at a rapid pace, and is confronting a significant and newfound adversity in austerity that is caused by a decrease in traditional means of funding, particularly venture capital and federal funding for R&D efforts. Mr. Burrill noted there has been an uptick in angel funding, and biotechs are finding they need to be a lot more creative in securing funding in order to succeed in the current investment climate. Case studies throughout the presentation illustrated the report’s findings, particularly when discussing pharmaceutical companies that are approaching patent cliffs and the risk-averse industry now that the “era of blockbusterology” has passed.
Mr. Burrill provided a trove of facts and figures, most notably that the biotech industry has raised $63bn in capital over the past year – the largest 12-month total haul in the history of the industry. Other highlights include: 80 percent of prescriptions in the US are fulfilled by generic drugs; the US is expected to spend an estimated $5tn on the healthcare industry over the course of the next few years; and that most of the industry’s “big products” will be in biologics rather than small-molecule drugs by 2016.
Another important finding in Mr. Burrill’s report focused on the shift in the roles doctors are playing in the healthcare system. As the industry transitions from an acute care system to a chronic care system, Mr. Burrill frankly stated that “doctors will be fired” as patients embrace real-time health information thanks to electronic health records and data that are now readily available on tablets and mobile phones, and added, “doctors will be rehired” as patients’ health advisors.
Other areas covered within the new report include the effects of international competition within the biotech industry, particularly the recent rise of Asian involvement in the industry, including the widespread variances of disease awareness, reimbursement policies and access to quality care. Mr. Burrill mentioned his concerns with the current state of the regulatory environment and the shift taking place in the pharmaceutical industry that will relegate large pharma firms in the near future to being in the distribution business, ceding discovery, development and manufacturing to other players in the industry.
Despite the concerns Mr. Burrill raised throughout his presentation, he ended the session on a positive note by stating he believes the biotech industry can be even more innovative than it already is. He concluded it is a “fabulous time to be in the business” and that “our best opportunities are in front of us.”