The answer may lie in mergers and acquisitions. As scientists, we often forget that these companies have skin in the game and are in to make a profit. Similar to the tech industry, there are a large number of startups with a high rate of innovation and even higher rate of failure. Biotech startups are arduous, high-risk ventures requiring deep pockets and several years of product development to reach market. Competition in the field is extreme and the pressure is on to scale-up technologies, pass regulatory standards and clinical trials before the startup just down the road.
The bioprocessing giants recognize the value that startups and small biotech firms can add to their business. They are on the lookout for any way to speed time that they can move their products to market.To do this, they seek to acquire smaller companies or startups because they often possess emerging and disruptive technologies that will reduce costs, and optimize efficiencies and weak development pipelines. Large businesses feel pressure from customers to deliver faster, quicker, better and less expensive products. Over the last decade, this has lead to businesses transitioning from a “build-to-grow” to a “buy-to-grow” mentality. Once startups raise enough capital and prove themselves successful within their niche, larger players gain interest in purchasing them with the intention of scaling up.
The large biotech companies look to invest in companies that will enable them achieve end-to-end processing. The technologies and techniques must lend themselves to multi-product and flexible manufacturing facilities; must be able to use single use components; handle more efficient production of greater titers and yields; and mesh with continuous processing and automation techniques. Does this sound expensive? Yes! But the major players seem like they are willing to dish out some major cash to gain this advantage.
Just within the last year, there have been several notable large acquisitions in the bioprocessing space:
- In March 2018, Fujifilm acquired Irvine Scientific Sales Company and IS Japan for $800 million to enter the bioprocessing market via cell culture media. They hope to gain synergies in biopharmaceutical manufacturing and regenerative medicine by combining forces with their Fujifilm Wako Pure Chemical business.
- In October 2018, Thermo Fisher Scientific acquired Advanced Bioprocessing from Becton, Dickinson and Company for $477 million. This acquisition moved them towards providing end-to-end processes and services to move drugs to market faster. Just recently, in March 2019, Thermo Fisher Scientific also announced that they will acquire Brammer Bio for $1.7 billion to advance their pharma services business. The transaction will be completed by the end of the second quarter of 2019.
- In February 2019, Danaher announced that they will acquire GE Life Sciences for $21.4 billion to be completed in the fourth quarter of 2019. This will be a stand-alone business within Danaher’s corporate structure but will also allow them to provide end-to-end drug processing. GE Life Sciences is joining other bioprocessing leaders including Pall and Beckman Coulter Life Sciences under the umbrella of Danaher Corporation.
So what does all of this mean for scientists? You are part of the process and while it may seem daunting to transition from small scale to large scale, there could be potential to grow and watch your products make it all the way to market! Sell your value and skills within a new organization and it may propel you to a new level of success. I know it can be scary, but the big-time players have experienced success with this business model and so can you!
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