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SUNDAY, NOVEMBER 22, 2009
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Ailing Biotech Firms Need Shot in the Arm

Flatlining economy threatens breakthrough medical research

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(Newser) – For the first time in years, the biotech industry is in desperate need of a lifeline, Bloomberg reports, as the economic crisis threatens to shove companies into bankruptcy and derail the development of potentially life-saving drugs. “I’m looking down the barrel of a gun,” admitted one CEO. Five such companies declared bankruptcy in the past month, and industry fundraising has dipped 54%.

Most at risk are firms just beginning to test drugs on humans; having little cash on hand, few drugs on the market, or little hopeful research data could also be death knells. “Most people would probably say there have been too many biotechnology companies that have been like the walking dead,” one analyst notes. “Deaths will be concentrated among companies that have little to offer.”

Decreased funding for biotech firms may mean work on dozens of potential treatments will stall or die as companies fire workers and shelve early research projects.
Decreased funding for biotech firms may mean work on dozens of potential treatments will stall or die as companies fire workers and shelve early research projects.   (Shutter Stock)
The amount raised this year by biotechnology companies fell by $9.7 billion through September, compared with the same period in 2007.
The amount raised this year by biotechnology companies fell by $9.7 billion through September, compared with the same period in 2007.   (Shutter Stock)
The global economic crisis has cut funding for biotechnology companies to the lowest level in a decade, triggering bankruptcies and threatening development of drugs based on biomedical breakthroughs.
The global economic crisis has cut funding for biotechnology companies to the lowest level in a decade, triggering bankruptcies and threatening development of drugs based on biomedical breakthroughs.   (Shutter Stock)
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Stock-picking will come back in vogue and people will ask, ‘Where are the 30% growers?' When that happens, everyone will again look to biotech because everyone loves a lottery ticket. There is a long-term silver lining. - Brent Milner, Stanford Financial Group

I’m looking down the barrel of a gun. - Biotechnology company chief executive

For the first time in the history of the biotech industry, you’re going to see unprecedented levels of bankruptcies and dissolutions. - Biotech analyst

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2 comments
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morenogabr
Nov 21, 08 3:57 PM CST
thats what the medical community gets for involving themselves within the business/political domain. It wasnt always that way... Reply
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petepenguin
Nov 21, 08 4:01 PM CST
Getting ready to go to congress for a bailout? Reply
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