Quote:
Originally Posted by HansTWN
The question is, is this bad for R&D in the field? A lot of the small biotech companies couldn't survive on their own, many are running on the income generated by just one drug. Seems their goal is to make themselves attractive enough for just such takeover, they are not necessarily capable of adequately marketing the new drugs they have developed.
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For small R&D companies, the drug is the product and the customer is the big pharma, not the patient. It comes down to understanding what you are good at; for the small biotech, it is R&D not distribution and sales. Big Pharma is good at sales, distribution, and regulatory affairs, not R&D. The value chain is fragmenting/has fragmented; vertical integration doesn't add value in this industry.
There are biotech companies that are opperating solely on developing products and licensing them to Big Pharma. There is nothing wrong with this; their revenue line is made up of royalties, license fees, R&D payments and milestone payments. If the revenues are greater than expenses on an ongoing basis, they will continue.
There are also companies that develop one drug or one platform of drugs. These companies are built to be sold. And there is nothing wrong with that.