Struggling old world economy

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This page is being edited by Murat Akguc EMBA09. In case of any questions/remarks contact me.


The biotech industry is still very much dependant on funding, to support expensive R&D projects and to maintain growth. This means that the industry is very vulnerable to the economic situation in the world. Furthermore, if e.g. private investors start looking at other investment areas, or if government funding is needed elsewhere, many biotech companies will find themselves in trouble.

Also the pressure from emerging countries are increasing. The research base is shifting, for example. Non-OECD economies accounted for 18.4% of the world’s R&D in 2005, up from 11.7% in 1996. The number of patents filed by Asian researchers also increased significantly over the same period, albeit from low levels.11 So the industry will have to forge much closer links with the most reputable centres of scientific excellence in these countries.

Current economic crisis also seems to impact western developed economies more than rising emerging countries like China and India. While biotech field is stated to be driving force for competitiveness of western economies, current global economic crisis has cut funding for biotechs to the lowest level in a decade, triggering bankruptcies and threatening development of drugs based on biomedical breakthroughs.


• Biotech industry seen as instrument to fight struggling economy
• Increased government and venture capital
• Lowered production costs
• The spread of technology to emerging and poor economies
• Aging Europe


• Expensive biotech R&D prevents further development
• Global Flu pandemic requires R&D dollars to be spent outside biotech
• Other interesting investment opportunities
• Biotech drugs very expensive


Economic downturns will force us to focus on current problems, not investing in solving future ones.



Web Resources:

PwC Pharma 2020: Challenging business models