Guest Post by Adelene Q. Perkins, CEO of Infinity Pharmaceuticals: The Seeds of Innovation – A Case for Independent Biotechs
The Massachusetts life sciences industry is a leader among the nation’s biotech hubs. We are home to the country’s largest concentration of biotech R&D, with Massachusetts-headquartered companies accounting for about 10 percent of the U.S. drug development pipeline and 5 percent of the global pipeline.* The therapies developed here are already making an important impact on millions of patients worldwide, spanning therapeutic areas such as cancer, cystic fibrosis and hepatitis C, with additional clinical candidates from Massachusetts-headquartered companies pending regulatory approval.
Given the intense, dynamic pressures of today’s economic and healthcare environments, how can we sustain the remarkable level of achievement that has defined and elevated this region’s biotech industry for decades? One of the key steps we can take is to work deliberately to ensure that there remains a path, for those biotechs who chose to do so, to remain independent.
Fueled in large part by big pharma’s desire to fill dwindling pipelines and overcome the fading blockbuster model through strategic acquisitions, successful biotech companies are often acquired. For biotechs, the challenging IPO environment and increasingly expensive cost of capital make an acquisition an attractive exit strategy for investors. Often, these acquisitions are inevitable given business constraints and circumstances, and they can yield important advancements that otherwise may not have seen the light of day. Acquisitions can combine big pharma’s resources with biotech’s cutting-edge research in a perfect marriage.
However, there needs to be a path for biotechs to remain independent. The frequency with which acquisitions are occurring may, to the extent that it becomes the only end game, stifle the very innovation that has been both the foundation of our industry and the source of truly novel medicines to treat today’s unmet medical needs.