Ailing Biotech Firms Need Shot in the Arm

Flatlining economy threatens breakthrough medical research
By Wesley Oliver,  Newser Staff
Posted Nov 21, 2008 1:05 PM CST
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)
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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.”