A Biotech Manager's Handbook

A Practical Guide

M O'Neill, M M Hopkins

• Publisher: Woodhead Publishing
• Year: 2012
• Print ISBN: 9781907568145
• eBook ISBN: 9781908818157
• Topic: Commerce
• Subtopic: Activité entrepreneuriale

A biotech manager's handbook lays out - in a simple, straightforward manner - for the manager or would-be entrepreneur the basic principles of running a biotech company. Most managers in biotechnology companies are working in their first company or in their first managerial role. Their expertise and experience in the scientific part of the work can be taken as a given but there is a whole range of other skills to be learned and areas of expertise to come to terms with. Small companies do not have big budgets to hire people or time to become an expert in so many areas. The book starts by outlining the state of the biopharmaceutical industry and goes on to explain the importance of planning (no matter what the size of the company). Succeeding chapters deal with the basics of intellectual property, perspectives from a university technology transfer office and how to raise some initial funding from an investor and entrepreneur.- No other 'how to' manual exists for this sector- Written by a range of expert professionals in each area, all in one book- Is the only 'bench to bedside' book covering the whole spectrum of development

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The bioscience sector: challenges and opportunities

Michael O’Neill and Michael Hopkins

Abstract.

Initially a term used to describe an emerging set of technologies, ‘biotech’ has become shorthand for a large part of the life science industry, a distinct sub-sector of smaller companies with their own culture and dynamics. Managing smaller companies requires a different skill set from that needed to succeed in academia or in larger pharmaceutical companies and the needs of this first group that our book aims to address. Knowledge of the greater landscape is essential to locate one’s own company successfully in this ecosystem. This opening chapter to A Biotech Manager’s Handbook provides an accessible, informal, but well-informed overview of the main themes and drivers for change in the ‘biotech sector’ and the challenges and opportunities for those working in it. We identify three major trends that have profoundly shaped the sector over recent decades: the information revolution, which has reduced the cost of producing and sharing biological data, but has opened up a host of new challenges associated with the interpretation of emerging science; a revolution in industrial organisation, where larger pharmaceutical companies are merging and shedding capacity while an entire ecosystem of smaller companies has sprung up providing services and products to larger established companies comprising everything from screening technologies, testing services and specialist knowledge all the way through to drug candidates. Investors have shown cycles of interest in these companies, looking for ways to derive value from an enormous boom in scientific knowledge. The final trend is an investment boom, as governments and private investors have sought to exploit biotech for social and economic gains. At the same time, challenges abound as R&D costs spiral due to the interaction of factors associated with new science, technology, markets and uncertainty. For the prepared, opportunities also arise as nimble new industry players bring better, faster or cheaper solutions to a growing number of potential partners in a global industry aimed at bringing improvements in health whilst also generating a return on increasingly high-risk investments.

Keywords

biotechnology

cost of R&D

Human Genome Project

investment

unmet medical need

venture capital

1.1 Introduction

The day-to-day work of a biotech manager is focused on running projects, managing people, worrying about costs, raising funds, producing data and much else besides. It is not always easy to stand back and look at the broader strategic picture. Keeping oriented with a sense of where you and your company are in the greater scheme is, however, a vital skill for a leader, particularly in a sector as fast paced as biotechnology. This book provides a broad overview of the issues we feel you should be concerning yourself with, and some ideas on how to identify and address key challenges, or even navigate successfully around them. The focus of the book assumes the reader is engaged in the development of therapeutics, given that this is often the largest component of the biotech sector in the Western countries we have experience of. However, much of the book is relevant to managers in other companies too, from financial planning, fundraising, intellectual property (IP) and deal-making to people management.

We have observed the biotech sector from the perspective of a range of organisations (working in very large pharma and with small start-ups) and noted that today few in the sector can feel secure or confident that their organisation has what it takes to succeed in an increasingly turbulent environment. Yet the advance of new treatments depends, increasingly, on the commercial success of organisations developing innovative approaches to tackling diseases. Managers undoubtedly face a tough task, but we have written this handbook to help anticipate problems and suggest solutions.

This first chapter provides context for the following chapters by outlining the main themes and trends in the industry at the global, organisational and technological levels. This is a complex arena, so we make no apologies for starting with a ground-up basic introduction to the sector followed by an assessment of the challenges and opportunities currently facing companies.

1.2 What do we mean by biotech?

Biotechnology has been defined as ‘any technique that uses living organisms (or parts of organisms) to make or modify products, to improve plants or animals, or to develop micro-organisms for specific uses’ (OTA, 1991: 29). This broad definition encompasses activities such as dairy processing and brewing that go back thousands of years. The application of microorganisms to pharmaceutical production began with fermentation processes more akin to brewing than to synthetic organic chemistry-based pharmaceutical production. In the 1970s, the advent of techniques for the genetic modification of organisms and cells that could be engineered to produce specific molecules such as therapeutic proteins heralded a new age of biotechnology, often termed ‘modern biotechnology’ to distinguish it from prior developments.

More generally the term ‘biotech’ is used as shorthand to refer to a whole host of small-scale companies dedicated to developing novel therapeutics, diagnostics, devices and research services. Indeed, as the techniques for biotechnology have spread to industries and companies established prior to the 1970s, the distinction between ‘biotech firms’ and new or incumbent pharmaceutical firms has become more difficult to make. The term ‘biotech’ has therefore become synonymous with small (often loss-making) companies focusing on life-science-based products and services. For the purposes of this book we will use the term ‘biotech’ in this more inclusive manner. Many early-stage companies are dealing with proto-technologies that have yet to fully define their field of application. They may be considering the potential of their technology to be a diagnostic, a therapeutic, or something they can offer as a research tool or service. Sometimes it can even be a combination of some of these (e.g. the discovery of an over-expressed protein on the surface of a tumour cell, such as Her-2, can be utilised as a research tool to differentiate cancer types, the target for an anti-cancer therapy, or a diagnostic/prognostic test that aids clinical decision-making).

1.3 From humble origins to big biotech

Modern biotechnology initially grew up in clusters centred around Boston in Massachusetts, and San Francisco and San Diego in California. These areas benefited from the proximity of an investment community that was able to see the potential of this nascent industry and was willing to invest in it. In the 1980s and 1990s a range of policy initiatives in countries across the globe were launched in an attempt to replicate this US phenomenon, in the name of economic competitiveness. The industry now comprises thousands of companies worldwide attracting billions of dollars in investment annually. Hundreds of companies have achieved stock market listings and the sector’s leading companies have market capitalisations in the tens of billions of dollars. The substantial growth of the industry can be attributed to three recent trends:

1. An information revolution: genomics, and IT (information technology) accompanied by an expanding scope of IP (intellectual property) protection.

2. An investment boom: government (grants, incentives) and private [business angel, venture capital (VC), stock market investors and corporate investors].

3. A revolution in industrial organisation: the restructuring of the biomedical industry.

1.3.1 The information revolution

The decoding of the human genome has been described in detail in many books. For example, you can read The Sequence (Davies, 2000) for an entertaining account of not just the scientific but the political and financial battles that surrounded the project. The whole multi-billion dollar undertaking was made possible by advancing instrumentation technology that allowed rapid and parallel decoding of vast chunks of human genetic code and corresponding advances in IT, particularly in bioinformatics, but also changes in IP rights that allowed, respectively, for the improved processing and potential commercial exploitation of this information (and therefore attracted investment in it). Over the last two decades the cost of generating and analysing biological data has plummeted. It is almost a cliché that technologies or methods that seemed almost science fiction, such as the $1000 genome, a few short years ago are now moving into sight. The ability to manipulate genetic material in vitro or in vivo is now a standard technique in molecular biology laboratories across the world. Lists of cutting-edge technologies appear out of date almost as they are written.

New data are being published by an increasing number of scientific disciplines in an ever increasing number of scientific journals. The impact of electronic publishing, data handling and ‘knowledge management’ means that these data are being made available at a rate that is difficult for even the most expert investigators in any one field to absorb. It might be more correct to talk about a ‘Data Revolution’ as we have yet really to find a means of integrating all of these data into information or real knowledge. The growth of bioinformatics data is, according to those leading data handling in large pharma, outstripping even Moore’s law of exponential growth in computer processing power. In practical terms, this has yielded a very real and immediate benefit for drug discovery. It is now possible to work on a much broader front than ever before as the human genome and the genomes of our myriad pathogens have suddenly provided a huge range of potential leads. Available ‘druggable’ targets now are counted in the thousands rather than in the hundreds. These new molecular targets for drugs are of course just the start of a long journey, but there are unprecedented numbers of opportunities to exploit.

As knowledge expands, the boundaries between academic disciplines blur rapidly and the t...

Table of contents

• Cover image
• Title page
• Table of Contents
• Copyright
• Dedication
• List of figures and tables
• About the Editors and Contributors
• Woodhead Publishing Series in Biomedicine
• Preface
• Acknowledgements
• Chapter 1: The bioscience sector: challenges and opportunities
• Chapter 2: Academic innovation: so you want to be a bio-entrepreneur?
• Chapter 3: Leadership and you
• Chapter 4: Managing self, situations and stress
• Chapter 5: It’s all in the plan
• Chapter 6: Exploring funding routes for therapeutics firms
• Chapter 7: Raising funds and managing finances
• Chapter 8: Introduction to intellectual property
• Chapter 9: Managing projects and portfolios in R&D: why and how
• Chapter 10: Successful registration of new therapies in the EU and USA
• Chapter 11: Clinical trials: design and practice
• Chapter 12: Business development: starting out
• Chapter 13: Business development: to the deal and beyond
• Chapter 14: Conclusions and final thoughts
• Index