Global biotech industry must reinvent itself to survive, warns PwC

Despite some very notable successes, the global biotech industry has fallen short of expectations, failing to reduce the risk in finding and developing new commercial medicines. To survive, the industry must now adopt a more collaborative approach, according to a new research paper from PwC, Biotech reinvented.

Although strategic collaborations are increasing in the industry, PwC believes that there is now a need for more co-operation to produce more efficient and cost effective medicines.

Working in a more collaborative environment requires organisations to share assets and insight that they have previously ring-fenced for themselves, a willingness to take risks and work with third parties and assets that they don't own and this will require investors to take a longer term view on rates of return and change the funding model.

''The current business model on which biotech has relied is flawed," says Simon Friend, global pharmaceuticals and life sciences industry leader, PwC. "Due to poor rates of return, investment has dried up and many of the external conditions that have allowed companies to thrive are vanishing. It is now a time for change.''

The research base is shifting East, emerging economies are competing more aggressively and financial investors are getting more cautious. Furthermore, the line between the biotech and pharmaceutical industry continues to blur.

According to Jo Pisani, partner, global pharmaceuticals and life sciences, PwC, ''Efficiency is the name of the game and the adoption of a more collaborative approach could just be the key to unlocking this potential. Working with others accelerates and facilitates innovation, discovery and development, which in turn can reduce costs and benefit both large and smaller companies. Even small changes could yield significant savings.''