Summary of Steven Burrill’s Predictions for Life Sciences in 2013

1. Fundraising will continue to be difficult for biotech companies. Venture investors will continue to move away from startups, and so angel and corporate venture organisations will need to fill that gap.  Investors from the emerging markets will become more prominent.
2. M&A activity fell in 2012. However an increase is now expected, and perhaps a big pharma or big biotech merger will happen in 2013.  Deals targeting companies that reach into Latin America, the Middle East and Southeast Asia will also be important.
3. The trend for pharma to externalise research will continue.  They will also continue to share risk with partners, for example using a milestone based system for payments.
4. Comparative effectiveness will become a reality for drugmakers as they will be required to demonstrate value and justifying pricing.
5. Diagnostics will become more important with drugmakers under pressure to define the subpopulation of patients that respond to the therapy.
6. Digital health technologies will become more common.

Top 10 Points from Steve Burrill’s Talk At BIO 2012 Presenting His State of the Biotech Industry Report

1. The general theme was ‘The New Austerity’.
2. There are several crises facing the industry and country: the end of the blockbuster drug era, poverty and its impact on disease, dysfunctionality of the healthcare system, the European debt crisis.
3. Governments are cutting spending on drugs or mandating reduction in drug prices, e.g. by requiring generic drugs to be available.
4. An increase in biologic drugs is taking place.
5. There is increased uncertainty in patenting given Prometheus and patent reforms.
6. There is the question of who is going to pay for healthcare and reduction in R & D spending that is taking place.
7. It is becoming tougher to innovate, but it is necessary to move from treatment-based to prevention-based healthcare.
8. New models for innovation are appearing, such as the collaboration between pharma and academics.
9. Emerging markets are becoming a magnet for pharma and biotech investments.
10. The wastefulness of big pharma is being recognised.  Most drugs only work for at best 50% of the population, the worst being cancer drugs which can be up to 75% ineffective.