Ey: 2014 global biotechnology Report

Source: Life Science dynamic monitoring express 2014-07-18 on July 2, 2014, Ernst & Young issued its 28th Annual Report of biotechnology industry, "beyond borders: Unlocking value global biotechnology report 2014" The report reviewed the overview of the global biotechnology industry in 2013 and pointed out that the global biotechnology industry picked up strongly in 2013, but most biotechnology companies are in the environment of limited resources and facing increasing demand for efficient R & D In order to create the value of R & D, ey put forward three suggestions for enterprises to implement adaptive clinical trials, precision medicine and pre competition cooperation The global biotechnology industry rebounded strongly in 2013 Listed companies have achieved double-digit income growth, and the financing scale has risen sharply The success of medical products has increased the company's revenue, and then attracted investors and large companies to increase R & D investment However, the growth of biotechnology industry is mainly driven by relatively small companies, which increases the sense of urgency for other companies in the industry to implement efficient drug research and development 1 main performance indicator of global biotechnology 1.1 revenue growth the revenue generated by mature regions of Biotechnology Development (the United States, Europe, Canada and Australia) is about US $98.8 billion, up 10% from 2012, but almost all of the growth comes from 17 "business leaders" enterprises in the United States (defined as companies with annual revenue of more than US $500 million) European revenue growth slowed, but profits soared 1.2 R & D investment rebounded strongly, with a year-on-year growth of 14%, and 20% of the growth was mainly from the United States This is the first time that R & D growth has exceeded revenue growth since the global financial crisis 1.3 decrease in net income the decrease in net income was $0.8 billion, partly due to an increase of $3.7 billion in R & D expenditure 1.4 market value soared the market value of listed companies increased by 65% to US $791.8 billion, mainly driven by the strong performance of "business leader" enterprises, which increased the enthusiasm of the industry as a whole 1.5 active financing North American and European biotechnology companies raised US $31.6 billion in 2013, a sharp increase compared with us $28.7 billion in 2012, which is also the second highest financing line since 2003 Initial public offerings hit a record high 50 biotech companies (in the United States, Canada and Europe) made initial public offerings in 2013, raising $3.5 billion, up 300% from 2012, the highest year since 2000 Venture capital is stable Total venture capital raised by companies in North America and Europe is about 5.8 billion, slightly higher than last year's $5.5 billion M & A presents a new atmosphere The total value of mergers and acquisitions of biotechnology companies involving the United States or Europe reached US $55.7 billion, an increase of 106% over 2012, but the growth mainly came from three large-scale mergers and acquisitions At the same time, acquisitions by increasingly active biotech buyers ($21 billion) dwarfed those originally initiated by large pharmaceutical companies, which grew by just 2% in value between 2012 and 2013 Excluding the Amgen / Onyx super merger, the total value of transactions between biotechnology companies increased 68% (to $10.6 billion) over the same period 2 The challenge and suggestion of creating value 2.1 R & D is still the key point to realize the value of biopharmaceutical companies Although the overall financial performance is strong, most of the biotechnology companies are in the environment of limited resources and facing increasing demand for efficient R & D In fact, R & D is still the central point to realize the value of biopharmaceutical companies Crucially, the failure rate of the third stage drugs is too high, reaching about 40% As the cost of advancing from the previous stage to the next stage of clinical trials increases dramatically, the failure of R & D in the third stage is a very inefficient capital utilization, and these funds could have been better deployed in other assets At the same time, other trends force companies to better measure and grasp the value created by their products For example, market access agreements build strategic alliances based on product business performance rather than clinical trial results 2.2 three ways to create R & D value: to create R & D value, three suggestions are put forward: to implement adaptive clinical trials: clinical phase I, phase II and phase III The long-term clinical trial system of phase research is difficult to create opportunities for self-improvement and learning of R & D projects of some enterprises, and leads to the occupation of R & D funds for at least three years, which will be regarded as sunk cost Adaptive clinical trial design enables biotechnology companies to improve their clinical assumptions and reallocate R & D funds in real time based on clinical data It is estimated that 20% of clinical trials are now under adaptive design, which is mainly led by global pharmaceutical companies, while many small and medium-sized biotechnology are far behind in introducing adaptive trials into early drug development Carry out precision medicine research: biomarkers and targeted treatment enable pharmaceutical enterprises to identify specific patient groups, so as to benefit from specific treatment, thereby reducing the risk of drug development and the increased valuation of stakeholders Precision medicine can also provide companies with more accuracy in risk sharing agreements However, it is estimated that only about 100 biomarkers are frequently used in clinical medicine Biotechnology companies should expand their application of these technologies Cooperation before competition: cross industry cooperation can solve the problems of the whole industry, such as establishing a unified clinical trial method and developing a standard for obtaining real data, which has been booming in the past few years For adaptive clinical trials, when most biotech companies have not found a suitable way to use them, they can cooperate with large pharmaceutical companies before competition Although pre competitive collaboration requires resource commitment from participants, including capital and senior leadership time, it helps enterprises avoid wasting valuable resources in the face of common challenges In addition, participation in these initiatives can help businesses build collaboration with key stakeholders, which are particularly valuable when health insurance agencies and regulators conduct more scrutiny Compared with the past decades, the challenges facing the biotechnology industry today are more lasting and more important, so the flexibility of biotechnology will be extremely important Adaptive testing, precision medicine and pre competitive collaboration all have the potential to enhance the value realization that plagues biological companies.