In the past few years, there has been rapid growth in the biotech sector, particularly in the US, ...
In the past few years, there has been rapid growth in the biotech sector, particularly in the US, which is set to continue.
Last year, the biotech industry had 37 new drug and vaccine approvals or new indication for existing drugs. This was a record, but hopefully the current year will show a further increase.
In 2000, the mapping of the human genome was more or less completed and this has led to a massive increase in new compounds entering the pre-clinical stage of drug trials and generated new technologies for the discovery and development of drugs.
There will be a need to select investments carefully though, as not all companies will achieve their drug development goals.
Increasing demand for new drugs.
Biotechs beat pharmas at delivering new drugs.
Profit flows from new drugs.It is estimated that there are more than 4,500 commercial compounds in clinical development in the US, compared to 3,500 in 2000.
This high rate of activity has increased the number of new drug applications and, given the long development time for drugs, new drug applications should increase further in future years.
Over the past 10 years, the drug discovery industry has invested substantially in various technology platforms that allow high throughput screening of compounds to select potential drug targets.
Since the mapping of the human genome, many of these new technology platforms have been genomics based and the development of computer programs has enabled preliminary screening times to come down from many months to a few days as the various technology platforms are used more. Therefore, the rising trend of commercial compounds in clinical development is likely to increase.
The biotechnology industry worldwide has approximately 750 drugs in clinical trials and it is estimated there are about 1,500 in pre-clinical trials. The sector therefore has the feedstock to continually bring new drugs to the market.
As the patents expire on formally profitable drugs, the big pharmaceutical companies replace them in their portfolio with the newer and more effective therapies, often buying them from biotech companies.
The biotechnology industry can research drugs that are directed at unmet medical needs - diseases and disorders for which in the past there has been no alleviation.
Since the mapping, of the genome it is possible to expect new drugs for newly-treatable conditions.
The biotechnology industry is likely to benefit as the aging populations in the Western world require more drugs, in particular for various cancers and other disorders that previously they would not have lived long enough to be subject to.
As countries such as China and India become more affluent, they too will demand more drugs.
Political pressures to reduce drug costs.
Increasing attrition rate in the research area.
Increase in regulatory control.