Biotech has had a profound impact on the pharma industry by helping to develop new medicines that treat patients more effectively; however, despite its achievements, it hasn't made a significant difference to the number of new treatments reaching the market. According to PricewaterhouseCoopers' (PwC) research paper, Biotech reinvented, biotech hasn't met the industry's expectations and will need to change its business model if it is to survive. Crucially, biotech hasn't reduced the inherent risk in drug discovery and development; the overall success rate is still only 9.1% for biotech drugs compared with 6.7% for a small-molecule drug.
Flawed business model
Unfortunately, biotech's situation worsens.
"The current business model on which biotech has relied is flawed," Simon Friend, Global Pharmaceuticals and Life Sciences Industry Leader at PwC, said in a statement. "Due to poor rates of return, investment has dried up and many of the external conditions that have allowed companies to thrive are vanishing."
In particular, the research base...