Considerations for Start-Up Biotech Company Valuation

The prospect of government regulation, product liability lawsuits, and customer reliance on third-party payers contribute to the complexity of valuing biotech start-ups. In addition, the inherent complexity of biologic drug manufacturing and storage creates secondary risks that must be considered in a valuation.


Market Orientation, Alliance Orientation, and Business Performance in the Biotechnology Industry

The purpose of this study was to test the unexplored relationship between market orientation (MO), alliance orientation (AO), and business performance (PERF) in the medical/healthcare subsector of the Canadian biotechnology industry.  The study surveyed Canadian biotechnology executives via mail and web-based questionnaires.  It was found that the relationship between MO and PERF was positive and significant and the relationship between AO and PERF was positive and significant.  It was also found that the relationship between MO and AO was positive and significant, supporting the existence of a mediation relationship.  Specifically, MO’s influence on PERF was found to be fully mediated by AO.  This suggests that Canadian medical/healthcare biotechnology companies that were highly market-oriented were also highly alliance-oriented, and highly alliance-oriented companies were top performing companies.  This study outlines the apparent sequential relationship between market-oriented behavioural commitments, alliance-oriented activities, and business performance outcomes among Canadian biotechnology companies.  Furthermore, it has business development and the commercialization process implications for biotechnology managers.


Where is the eBay for Intellectual Property?

This paper is an examination of the economics, organizational dynamics and structural factors inhibiting an electronic market for intellectual property.  Several intermediaries exist to facilitate the transition of intellectual property (IP) from sellers to buyers.  Over the past 20 years, a number of companies attempted to create an online “eBay for IP.”  These IP Exchanges (IPEs) failed to gain traction in competition with other mediums that provide channels to facilitate IP transactions.  Compounding the problem is the concentration of intellectual property assets amongst a small group of institutions and within those institutions as well as organizational hurdles inherent in academic technology transfer offices.  As a result, the business model for an online IPE market is fundamentally challenging, and no successful IPE exists to date.


Deciding between biobetter versus biosimilar development options based on net present value calculations

 

Abstract

The growing share of biopharmaceuticals is paralleled by an increasing interest in biogenerics, as blockbuster biologics are approaching their patent expiries. Companies need to make decisions whether to invest in biosimilars or in biobetters with enhanced properties, the latter enabling favorable differentiation vis-à-vis the original product on the one hand and biosimilars on the other hand. Net present value (NPV) modelling was applied to evaluate the financial attractiveness of two categories of biobetters in comparison to biosimilars, and recommendations are made which options should be preferred depending on a company’s business model.


Canadian Venture Capital – Unlocking the Funding Challenge

Canada plays a significant role in the global advancement of scientific discoveries and their translation into commercial opportunities, but is viewed as not fully realizing its commercial potential. A significant problem has been a lack of sufficient venture capital to take early-stage companies to the next level. Several recent developments may signal the arrival of a more positive venture-funding environment for life sciences and health technology enterprises, including the development of the Canadian government’s C$400 million Venture Capital Action Plan; pharmaceutical companies electing to establish or investing in venture funds and providing strategic support to early-stage ventures, including through the creation of research centres; and recent successful liquidity events for venture investors.


Pharmaceutical R&D Productivity: The Role of Alliance

In recent years, the major research-intensive biopharmaceutical companies (big pharma) have come face to face with a perfect storm of eroding profit margins from blockbuster expiration and generic competition coupled with growing R&D expenses and d…


Building biotechnology in India – Drugs are not the answer

Ihave had the pleasure of participating in national forums on biotechnology development in diverse countries. A common theme I see is that emerging economies wish to develop ‘a biotechnology industry like the United States.’ I generally temper these ambitions by explaining that the United States does not have a biotechnology industry per se, but rather a handful of states have very strong biotechnology concentrations and many other states are still trying to build their domestic biotechnology industries. So the lesson for many emerging economies is to set ambitions at the US-state level rather than the US-national level. Furthermore, I also caution against aiming for drug development. Drug development is extremely expensive and risky—focusing on domestic agricultural or industrial biotechnology opportunities may be a better option.


Fostering technology transfer in industrial biotechnology by academic spin-offs

Industrial biotechnology is the commercial application of biotechnology using cells or components of cells, like enzymes, for industrial production processes including consumer goods, bioenergy and biomaterials. In the last years this area has gone thr…


Why pharma's 'anti-competitive' practices may actually be good

The FTC is reportedly seeking $1 billion from pharmaceutical companies for the role in paying generic companies not to challenge their patents. Despite first appearances, these agreements for a generic company not to challenge a patent, called ‘reverse settlements’, may actually be good for innovation. The rationale for reverse settlements is discussed in my textbook, […]


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