Biotech in Good Shape for 2010 - The companies that have survived the financial meltdown are well placed to adapt to the new environment that we now are entering. - BioPharm International

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Biotech in Good Shape for 2010
The companies that have survived the financial meltdown are well placed to adapt to the new environment that we now are entering.


BioPharm International
Volume 23, Issue 1

PARTNERING STILL A STAPLE FOR BIOTECHS

Although there is still some residual investor nervousness about the strength of the economic recovery, there is no doubt that the markets are back on track and the biotech industry will certainly benefit from this in 2010. Biotech companies also are benefiting from Big Pharma's willingness to pay for innovation. Partnering revenues have been a staple for many biotech companies throughout the year and, as a result, we are likely to see a record amount raised by US biotechs by the close of the year.


Table 2. Selected partnering deals in 2009
Notable partnering deals in the past few months have included several that could be potentially worth over $1 billion (Table 2).

WHAT LIES AHEAD?

Healthcare reform will pass and this will have a mixed impact on the biotech industry. The proposed reform is in favor of allowing 12 years of data exclusivity for biotech drugs, and that is good for our industry. With 25–50 million Americans added to the healthcare system, revenues for the healthcare industry should increase, which is also a positive. However, there continues to be some investor uncertainty over the healthcare reform debate and this is likely to continue as the legislators wade through the proposals. The drug industry certainly will take a big hit in the House bill. For elderly people who are eligible for both Medicare and Medicaid, the bill mandates rebates from the drug makers so that the Medicare system ends up paying less. Those rebates are estimated to cost the industry $60 billion over a decade.

G. Steven Burrill is chief executive officer at Burrill & Company, San Francisco, CA, 415.591.5400,


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