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In the cold winter after the bubble, the ecological pattern of innovative drugs is being reshaped, which will inevitably lead to the redistribution and concentration of funds and talents, the two survival factors of biotech, and the situation of indiscriminate prosperity of the market will never return, and biotech is thinking about how to improve its ability to survive the cold
.
Statistics show that the survival rate of biotech in the United States does not exceed 5 years, about 29%, 5-10 years accounts for about 36%, and companies that can survive for more than 10 years do not exceed 36%, and there is a 99% research and development failure rate
.
And the successful launch of a new drug will take at least 10 years, such a risk to say "nine deaths" is not an exaggeration
.
Counting the development of Biotech, the following directions can be roughly summarized:
Counting the development of Biotech, the following directions can be roughly summarized:Direction one
Direction one Transformation and upgrading into a Biopharma that is good at research and development, production, sales system and sustainable development, until it becomes Bigpharma
.
.
This is the upgrade road that many biotech companies have been looking forward to and yearning for from the beginning, and it is also the most difficult road
.
According to Industrial Securities Research Report, referring to the development history of the biopharmaceutical industry in Europe and the United States, 90% of biotechs in China hope to transform into BioPharma, and if there is a certain scale of research and development matrix and a few varieties that have just been commercialized, it is expected to further develop into BigPharma
.
However, this has high requirements for its own conditions and capabilities, not only need to have continuous global leading research and development capabilities, but also have strong international capabilities, complete management systems, marketing systems, etc.
, and the founders of the company also need to complete the butterfly change
from scientists to entrepreneurs.
In this regard, someone has summarized six prerequisites for your reference:
1.
The product has clinical value and differentiation
The product has clinical value and differentiation
All drugs must be clear and effective based on clinical value, which is the basis for
ensuring marketing approval.
Differentiation of clinical value is the key to
ensuring the victory of medical insurance negotiations and market competition.
The product pipeline must have a certain thickness, it is difficult for a single product to be sustainable, and the treatment field where the core product is located must have a market size of more than ten billion or potential scale, in order to support the research and development
of subsequent products.
With the profound transformation of the pharmaceutical and medical system, the pharmaceutical industry has gradually changed from sales-driven to product-driven, especially those "good products"
that can truly meet clinical needs.
"Good products" is the basis for
transformation and upgrading.
2.
Have the ability to operate and control the whole life cycle of products based on the global market
Have the ability to operate and control the whole life cycle of products based on the global market
The core key is the ability
to obtain product revenue in the global pharmaceutical regulatory market.
Due to the particularity of drugs, which have both commodity attributes and social attributes of people's livelihood security, at present, in China's drug pricing system, the mechanism of people's livelihood security is greater than the market mechanism, which is different from the completely market-oriented pricing mechanism in Europe and the United States; In addition, commercial insurance as a supplement to government medical insurance has just started
.
Therefore, based on the layout of the global market, especially the product registration, licensing and clinical promotion of standardized market-oriented pharmaceutical markets such as the United States and Europe are particularly important
.
3.
The entrepreneurial quality of the founder and the construction of modern company system
The entrepreneurial quality of the founder and the construction of modern company system
Biotech companies are mostly based on technology or product research and development, lack of production, quality, marketing, sales, finance, human resources and other management systems, as a necessary step of transformation and upgrading, enterprises should establish and continuously optimize the above management system as soon as possible, the founder to complete the butterfly change
from scientist to entrepreneur.
4.
Have sustainable financing ability
Have sustainable financing ability
Pharmaceutical research and development requires long-term continuous investment, especially innovative drugs, and the investment period is longer
.
Before the product is approved for listing, regardless of whether it has been successfully IPO or not, it must be able to obtain the required funds
through the primary market or secondary market through the product license authorization or through equity financing, and the industry or capital side.
5.
Sales model and market strategy based on the global market
Sales model and market strategy based on the global market
The appropriate sales organization method
should be selected according to the company's strategy, product attributes, product market competition and other factors.
Select the priority listing countries of products, and formulate different sales models and market strategies
according to different market characteristics.
For enterprises with rich product pipelines and strong product innovation, they should build their own teams around core products, explore cooperation with CSO/other pharmaceutical companies in market segments, and combine "academic promotion + market access + customer management" in product marketing
.
6.
Have a strong BD team and resource integration capabilities
Have a strong BD team and resource integration capabilities
The company needs to dock and integrate domestic and foreign products, technologies and market resources, so that its own products can form a combination with other advantageous products in the same field, learn to leverage strength, and explore various forms of strategic cooperation
with partners.
Direction two
Direction two Through M&A, we will integrate industries and become a new industrial body
.
.
For example, it has been acquired by large pharmaceutical companies at home and abroad and become part of its product pipeline or technology system; Or form a new consortium with large CDMO companies and professional CSO companies
.
This type of approach is particularly common in the United States, but China does not yet have such soil
.
The reason is that there is still a lack of large-scale biopharmaceutical companies in the true sense of the word, and there is no professional CSO company, and foreign enterprises are restricted in mergers and acquisitions; Coupled with the continuous support of various types of capital, the valuation bubble of Biotech companies is serious, the primary and secondary markets are seriously inverted, and the willingness of enterprises to operate independently is strong
.
Although the current environment is not yet mature, this is still a good path
.
.
In order to survive, it is common
for Biotech to sell the company as a whole or sell the company's core projects, internationally.
Most of the overseas biotech is mainly selling, and the domestic market is still quite new
to this operation.
I-Mab, for example, recently announced that I-Mab, a US-listed company, is seeking to acquire or sell shares in specific drugs, or will sign the largest "deed of sale"
for domestic biotech.
Although I-Mab's founder and chairman Zang Jingwu said in an interview that this is just market speculation and the company will not comment on market speculation, the rumors have intensified
.
Moreover, after the news of I-Mab's "sale" broke out, it continued to rise by more than 25% before the market that day, which shows that the market also wants to take a step
.
for Biotech to sell the company as a whole or sell the company's core projects, internationally.
Innovative drug research and development is a lifetime of death, and failure is the norm
.
Biotech is at risk of cash flow disruption if it makes a mistake, and after making good progress early in the pipeline, a big pharma acquisition is obviously a good choice
.
However, if I-Mab, which is in the second echelon of biotech, has to sell itself, the situation of those small biotech companies is even more difficult
to say.
Perhaps, in the near future, there will be many cases of biotech companies selling themselves
.
.
Direction three
Direction three Based on the technology platform or field, Biotech companies carry out mergers and acquisitions and reorganization to achieve co-development, or form a CRO company (contract outsourcing company) with professional and technical characteristics, and obtain funds for enterprise development and support project research and development through external licensing of products, output and transfer projects, and undertaking outsourcing service development
.
.
It is a good choice
for biotech companies that are not strong in BD and cannot grow from scientists to entrepreneurs.
For example, enterprises with innovative products but insufficient BD capabilities can integrate with enterprises with BD competitiveness but insufficient product innovation to solve the problem of
products going overseas or self-hematopoiesis.
Or the integration of two companies with clinical-stage products to improve the level of scientists, the size of the clinical team, and the number of
products.
This collaborative optimization can further increase the job saturation and compensation of top employees, and for many support positions, it can significantly reduce operating expenses
.
for biotech companies that are not strong in BD and cannot grow from scientists to entrepreneurs.
Direction one
Direction one Adhere to the original intention, open source and throttle, and become a "small and beautiful" biotech
.
.
Although it may not be able to become bigpharma, it does not prevent the founding team from adhering to the original intention of pharmaceuticals at that time, focusing on specific diseases or technology areas in which they have advantages, and cooperating with pharmaceutical companies with strong commercialization capabilities, each taking what they need, which is also a way
to realize corporate value.
According to statistics, after a long period of scientific research precipitation, China's license in & out transaction volume reached 132 in 2020 and increased to 174 in 2021
.
From license in growth to license out outbreak is an important embodiment of China's independent research and development strength, under the data is the fire of small biotech that dares to break through and is committed to research and development
.
.
Small biotechs bear lower risks than leading biotechs and established pharmaceutical companies in terms of scientific research, personnel, and funds, and from the perspective of utility ratio, they are easier to make me first products
at low cost.
Under the circumstances of poor financing performance in the equity market, License out has become the main tool
for small new drug R&D enterprises to quickly break through the profit ceiling, reduce scientific research risks, and realize cross-border overseas globalization.
According to Deloitte's latest Pharmaceutical Innovation Report released in 2021, since 2018, the proportion of biopharmaceutical companies' late-stage pipelines has become increasingly external
.
Biotech has joined forces to accelerate product development and commercialization in response to its weak points
.
Many established pharmaceutical companies are also actively transforming, adjusting the pipeline layout logic through outsourcing pipelines and making new choices
in disease areas.
.
In short, embracing cash flow, diversifying cooperation, and optimizing pipeline and asset allocation are undoubtedly the main strategies
for Biotech to achieve continuous operation at this stage.
If none of the above paths work, then in the end you can only leave the market and exit
.
Of course, for companies with unreasonable equity structure, unclear clinical value of core products or inability to form differentiation, it is better to stop losses
in time.
for Biotech to achieve continuous operation at this stage.
epilogue
epilogue Compared with developed countries in Europe and the United States, China's innovative drugs have just started, and the gap is still very large, especially in the technology, clinical design and application of complex preparations
.
However, after more than ten years of rapid development, both the number and scale of R&D subjects and products under research have been considerable, and the first stage of China's new drug research and development has been basically completed
.
In the next 5-10 years, these thousands of biotechs will carry out natural selection
for survival of the fittest through upgrading and transformation, mergers and acquisitions, etc.
It is expected that the proportion of successful commercial transformation and development into Biopharma will still be relatively small, and more enterprises will achieve transformation and life
through integration and exit, transformation and development.
Finally, I still hope that the pharmaceutical industry with long slopes and thick snow can continue to emerge a variety of enterprises, including small and beautiful Biotech, thick and thin Biopharm, and Bigphram with successful transformation, always do their own positioning, do what they should do, do what they can, aim high but not be ambitious, practice internal strength and wait for market feedback
.
