Europe getting jiggy with it
All across Europe right now, as funding season opens for the main European Commission funding programme FP7, companies and researchers are experiencing the hitherto undiscovered experience of getting up close and personal, quite often with complete strangers.
The mating game of the Framework Programme Seven call is a strange one for many. Academics are used to the familiar faces and routines of a lifetime within the same small circle, in many ways the gentry of science – plenty of close marriages there to protect the bloodline. While small companies are the wide boys of the game – circling warily and nervously, looking for that elusive marriage that brings status and money that they can squander on some high risk turn of the card…. Finally, the large co.s, like enormous crocodiles basking in the sun, watching what’s going on, sometimes striking successfully and other times a little too slow off the mudbank.
Let’s leave out the big co.s, the machinations of internal workings needed to get permission to do anything within 6 months of initial request, usually counts them out of the FP7 tango. The academics and small companies provide enough entertainment to last the season. As Europe wonders where all the money went (a familiar lament within biotech for many years now, glad you could join us), the increasingly SME-oriented Framework Programme is financing marriages never seen before.
The game starts with a jolly good idea from a company or academic group. At the very start, the expectations are wildly different – the academic daydream is another 3 years of secured funding and a step in the right direction towards that Nobel prize, while the company will be watching the dwindling coffers, feeling the hot breath of investors on their necks and looking for the dreamy partnership of a large pharma and lots of lovely money (don’t worry dear readers, it is crushed early in the process).
The next step is to read the call for proposals fully and realise that it wasn’t written just for you – sometimes it has impertinence to suggest that you might not be able to do it all by yourself and that you may have to bring in one or two other people. Phooey say the applicants and they start eying up the contenders on the dance floor. Academic groups will be generally looking for other academic groups to start with – stay in your comfort zone, before realising that you have just allocated 99% of the budget to other academics and that call did mention 35% needing to go to SMEs. ‘What on earth do they need all that money for?’ is the lament and they start the messy business of trying to understand how on earth their brilliant research could actually leave the lab and fall into the grubby hands of the wide boys.
The wide boys, I mean small companies, on the other hand, have come up with a wizard way to spend the money all on themselves, even though they have a staff of 6, and that includes Chris who makes the tea and fills the pipette boxes. And surprisingly, for companies often borne of academic innovation, the view back into academia for partners is rather cloudy, particularly beyond the close academic group that may have provided the founding technology.
But the dance finally starts with a few contacts and the general idea that their various talents might contribute towards the topic of the EC call. It starts slowly, after all, it’s weeks until the deadline…with nicely phrased suggestions and plenty of pretending that you know what the hell one of the others is talking about. There will be a mad one – it’s the law – and your project idea will suddenly grow horns and charge off into the next field, scattering innocent victims left right and centre. If you are lucky, somebody will see sense and ask why a project aimed at developing a new therapy really needs a floating laboratory in the Med and technicians with see through labcoats or the need to smuggle snails out of Chile in your pockets.
While you are fitting in occasional project conversations around the edges of your usual full time job, time is ticking on – without realising it, the band has finished the drum solo and is moving on towards the grand finale. The deadline, once so far away is suddenly next week and people find themselves taking off all their clothes without even asking the surname of their partners.
Luckily, the terror of an imminent deadline overcomes all shyness (and madness) and the project idea rapidly finds a more sensible focus, especially after you realise that you forgot to add 60% overheads onto all your costs and have to cancel the order for the transparent yacht and coat with snail smuggling pockets.
One final night and day of frenzied activities, where children are forgotten, coffee is drunk cold and you have shouted (through the magic of Skype) at somebody with a Nobel prize for chemistry, the proposal is submitted. You emerge blinking into the sunlight (well, rain if in Brussels), realise you have just spent a torrid night with a group of semi-strangers and slowly put your clothes back on. You check what their surnames were from the project description (just to make it respectable), smile in an embarrassed fashion at each other and survey the scenes of devastation in your email box and waste basket.
Don’t worry, you’ll recover and you will do it again next time, you floozy.
Claire Skentelbery
Secretary General
European Biotechnology Network
The European Biotechnology Network is part of a charitable foundation with the mission to build partnerships across the biotechnology sector in Europe. As well as a directory with over 2400 R&D active company listings, the Network runs a Biotechnology Funding Hub which tracks research funding available to companies across the globe, including FP7 and NIH funding programmes. It works with partners all over the world to build the right partnerships for successful delivery of biotech to the market, field and clinic. Individual membership is free of charge so come an join the family!
Is the Venture Capital Model a Dead End for Early Stage Biotech?
Venture capital funding is considered to be the lifeblood of any promising biotech company but because of several years of recession and timid investing the industry has suffered. The recent PwC MoneyTree and Dow Jones VentureSource reports show some positive signs that investors are getting back in the game. While the number of deals continues to shrink, the amount of cash invested has actually increased. This means fewer but fatter deals for biotechs who can prove they are worth the risk. The data also reveals a trend of venture dollars moving away from early stage companies and into increasingly later stage deals that offer a bit more security and a faster turn around for investors.
“If you don’t have a clear pathway through the FDA, it’s tough to get funding these days. It clearly is raising the bar on what type of companies will get funded by the venture capitalists,” noted Tracy T. Lefteroff, global managing partner of the venture capital practice at PwC.
Related Event: C21 BioVentures 2011
May 24-26, 2011
The Meritage Resort
Napa, CA, USA
Find out more
First time deals are sharply down
During Q1 of 2011, 35 life science companies received venture capital funding for the first time, attracting $129 million. This data represents a sharp 40% decline in the number of companies and a 46% drop in dollars invested when compared to the Q1 of 2010.
“First-time funding is expected to remain challenging for the sector, with fewer deals and smaller deal size for fledgling companies,” Lefteroff observed. “Lengthy and costly R&D and uncertainty in the regulatory approval process continue to drive more investors toward follow-on and later-stage deals with companies that are closer to successful product launches or the exit market,” he continued.
So what does this mean for the early and mid stage, cash strapped biotech company? What impact will it have on innovation? Is this the beginning of larger changes in the way we discover, develop and commercialize tomorrow’s medicine?
Tell us what you think by leaving your comments below. Continue the conversation with us at C21 BioVentures on May 24-26 in Napa, California. C21 is the leading conference for early stage biotech investing and partnering. With an all-star advisory board of leading VCs, a world-class program of experts covering current issues and unparalleled access to meet face-to-face with top pharma and investors, C21 is a must attend for leaders serious about moving their business to the next level.
Looking for more? Related stories: VC Deal Terms: Double-Dipping in the Life Sciences - Forbes.com
2010 Venture Financing in Review — A Year of Slow Recovery - Cooley LLP
More VC But Fewer Deals Signal That Investors Are Becoming Even More Risk Averse - GEN
Biotechnology startups struggle as venture capitalists seek quick hits - SF Public Press
- Jonathan Inman
Marketing Manager, TVG
About TVG
Since 1992, TVG has been connecting innovators and leaders in the life science industry across the US, Canada, China, Europe, Australia, Latin America, India, and Asia. TVG enables a global network that supports life science companies as they build new relationships, enter new markets, and create new products. Our 19-year track record (1992-2011) of success is founded on our deep industry knowledge, our integrity in business, and our powerful network of valuable relationships. We are judged by the company we keep and have helped over 3,200 life science companies achieve their business goals. We continue to expand our network into new markets in Latin America, China, and India — fulfilling our vision to be Your Global Life Science Network.
Raising Capital in a Tight Market
The global financial crisis has made it challenging for the biotechnology industry to raise capital to fund innovation. Experts say venture capital money is still available, but often the VC community is looking for lower-risk, short-term projects.
As a result, biotech companies are increasingly looking to alternative sources of capital. Experts say this is a natural reaction to normal business cycles, and when venture funding dries up companies embark on other strategies to survive.
For example, in 2008 and 2009 industry leaders say alliance deal making and applications for grants increased.
At The National Cancer Institute, applications for the SBIR grant program increased by almost 70% between 2008 and 2009.
This increase was a direct reflection of funding drying up in the venture capital market,” says Michael Weingarten, director of the NCI’s SBIR program. “We became the only game in town for many companies and a lifeline for biotech companies looking to fund new innovation and new technologies in the cancer field.”
The funding markets continue to be very tough, which is not a big surprise given the macro environment, says Oliver Fetzer, Ph.D., president and CEO of Cerulean Pharma. “There continues to be a fair amount of uncertainty in terms of the direction both biotech and venture capital are going to go,” he says. “Society is expecting more innovative products at potentially lower prices rather than higher prices. This creates a pricing environment that makes it tougher for biotech companies to find a clear path to profitability.” At the same time, Dr. Fetzer says, the venture capital firms are finding themselves in an environment devoid of many big success stories.
- Denise Myshko
PharmaVoice Magazine, PharmaVoice
To read the full article, please click here: http://bit.ly/Raising_Capital_ina_TightMarket
About PharmaVoice
PharmaVOICE magazine, reaching more than 25,000 BPA-qualified life-sciences executives, is the forum that allows business leaders to engage in a candid dialogue on the challenges and trends impacting the industry. PharmaVOICE provides readers with insightful and thought-provoking commentary in a multiple-perspective format through forums, topics, and articles covering a range of issues from molecule through market. PharmaVOICE subscribers are also kept abreast of the latest trends and information through additional media resources, including WebLinx Interactive WebSeminars, Podcasts, Videocasts, White Papers, E-Surveys and e-Alerts. Additionally, PharmaVOICEMarketplace.com provides a comprehensive directory of products, services, and solutions for the life-sciences industry.
To Raise Your VOICE, contact feedback@pharmavoice.com.
Get it ($$), while the getting is good | Partnering is on the upswing, so start now for success
Have you heard? We’re on the upswing! Venture capital, according to PWC MoneyTree, is already higher in 2010 Q3 than it was in all of 2009. And, as we recently reported in the California Biomedical Industry 2011 Report, 53 percent of surveyed California biotech CEOs plan to add workforce to their operations this year. Another 48 percent of the respondents believe that a merger/acquisition is possible in the next year.
What’s the significance of this? That you had better get out there and find a partner, an investor, or a new source of capital before someone else does. And increasingly, the action is global. Just look at the recent deal flow: Daiichi Sankyo’s acquisition of Plexxikon, Servier’s partnership on XOMA’s anti-inflammatory agent, Galderma’s expansion of its collaboration with NovaBay Pharmaceuticals. That’s why we are bringing the world to your doorstep at BayBio2011 | Powering Global Innovation. We’ve expanded our conference to a two-day format with global reach.
No other region in the world boasts the economic vitality, intellectual superiority and entrepreneurial go-get ‘em than Northern California. BayBio2011 | Powering Global Innovation is dedicated to increaseour region’s connectivity to the global community. Here’s how we’re doing it this year:
- Top notch speakers, including Dr. Jorg Reinhardt, Chairman of Bayer HealthCare and Myrtle Potter, renowned author and healthcare expert, formerly president and COO of Genentech from 2000-2005
- Eight tracks and 32 best practice sessions dedicated to financing, emerging markets, business development and more
- Company presentations from Stanford, Berkeley and UCSF’s best start-ups and emerging companies to world class investors
- Partnering Forum to collaborate with Merck, Genentech, Abbott, Elan, Baxter and more. (Partnering Forum powered by TVG’s biopartnering.com)
- Career Fair anchored by Bayside Solutions, Codexis, Fibrogen, Gilead, Johnson & Johnson, MedImmune and Solazyme
- Inaugural Bay Area BioGENEius Challenge for high school students to identify the scientific leaders of tomorrow
Come share ideas, learn best practices for doing business globally, connect with global leaders, present to investors and meet with potential partners. There are opportunities once again!
- Gail Maderis
President and CEO, BayBio
About BayBio
BayBio is Northern California’s life science association. We support the regional bioscience community through advocacy, enterprise support, and enhancement of research collaboration. We maintain Northern California’s leadership in life science innovation by supporting entrepreneurship, science education and life science career development through the BayBio Institute. Our members include organizations engagedin, or supportive of, research, development and commercialization of life science technologies. For more information, please visit: http://www.baybio.org
Pharma-biotech partnerships: creative approaches to doing the deal
Research and development partnerships between big pharma and the biotech sector are now a vital component in bringing new medicines to the market - so much so that securing the best molecules for the best price has become a core competency for big pharma companies.
The relationship between pharma and “biotech” (i.e. small, start up drug discovery companies) is now mature, and mutually dependent. Declining productivity from in-house R&D operations means big pharma is becoming more and more reliant on external alliances to produce the medicines of tomorrow. Conversely, small pharma and biotech companies with limited cash reserves need to find big pharma partners to help them develop and bring their drug to market.
Around $25 billion was spent by big pharma in licensing deals and other R&D alliances in 2010, a figure which looks set to continue growing over the long term.
The dynamics are clear when pharma and biotech start to negotiate on licensing; big pharma won’t have to pay as much if it buys into a molecule at phase I or earlier, and will face less competition from other big pharma companies looking to do a deal. But the chances of the molecule being a failure are high.
The alternative is to sign a deal only once a drug has shown proof of concept in phase II or later - but prices are higher, and competition for the deal is greater. Even then, its success is far from guaranteed.
Figures suggest that the trend for pharma is for a greater proportion of deals to be done in phase III. Statistics compiled by Deloitte in 2009 showed 35% of deals were done in late stages, though early stage deals were still more common, accounting for 41 per cent.
Meetings and molecules
Partnering conferences are one of the prime means for pharma and biotech to meet and exchange information, TVG’s recent BioPartnering Europe being one of them.
Speaking at the event, Dr Chris Brown, director of International and Primary Care, Pfizer, explained how his company goes about finding partners.
“Our collaborations span every area of development. We recognise that some of the most exciting science happens outside the walls of Pfizer.”
Dr Brown says Pfizer uses a number of means to identify promising molecules - by attending partnering conferences, using pipeline databases, venture capital intelligence and company visits. Promising ideasgo through an initial screening (answering the basic question of whether or not it aligns with the company’s strategy) followed by analysis and due diligence, with assessment from the science, manufacturing, commercial and finance side of Pfizer. Then the company’s business development committee will follow through negotiations with the various deal structure options on the table.
Pfizer is interested in local, regional and global opportunities to partner. “We are looking for late stage compounds with a broad geographical scope. A deal with Pfizer can provide a company with sales and marketing know-how,” Brown says.
Dr Robert Kilpatrick is founder and partner of TVG, which runs the BioPartnering conference. He says that because biotechnology is now a global industry, partnering needs to take place in a variety of ways- between large and small companies; Western and non-Western; established and new; and virtual and bricks and mortar. “Openness to new thinking is combined with access to new markets and novel deal structures, so what is taking place is now termed ‘creative partnering’,” he says.
TVG launched BioPartnering Europe in 1993 as one of the first life science partnering conferences. This year we have held high profile events in three emerging markets - BioPartnering India in Bangalore, BioPartnering Latin America in Rio de Janeiro and BioPartnering China in Shanghai.
“Partnering is just being adopted in these markets and there is a learning curve involved. TVG has also learned a lot about partnering around the world because we have worked with over 5,000 companies overa 20 year period,” he explained.
This year’s BioPartnering Europe event brought together more than 450 companies from 30 countries, including many biotech companies eager to talk to pharma licensing executives and persuade them that theirmolecule or technology was worth investing in.
One company was Swiss firm Telormedix, a biopharmaceutical company focused on targeted immunity in the treatment of cancer. Their lead product TMX-101 is moving towards clinical trials in bladder cancer and the company is now looking for partners. Johanna Holldeck, Ph.D., chief executive, who has worked with many big pharma companies, including Roche, Aventis, Schering and Johnson & Johnson, said: “For biotech companies, it is important to have core operations in place for licensing. Investors need external validation and if big pharma is interested, then the investor will be too. Co-operation with big pharma also allows access to their expertise and know-how,” she added.
Innovative molecules, innovative deals
Partnering deals between biotech and pharma come in all shapes and sizes. Damian Marron, Ph.D., chief executive at Marseille-based Trophos described an interesting deal it struck with Swiss specialist pharma firm Actelion earlier this year.
Trophos is developing a number of therapies in neurology and cardiology. Its lead compound TRO19622, a novel oxime, is in phase III for amyotrophic lateral sclerosis. Actelion’s Tracleer, is licensed for the treatment of pulmonary arterial hypertension, a life-threatening disorder and a $1.3 billion market.
Trophos needed to refinance and to maintain its clinical programme. Under the agreement, Actelion has paid $10 million for an option to acquire Trophos for $125 million plus two milestones for a further $70 million - US approval of its drug and progress on other programmes. The two companies have set-up a research collaboration in which Actelion compounds are screened in the Trophos screening programme.
“This deal buys Actelion a new approach to neurology research,” Marron pointed out. “It is a good fit for both companies. This deal is not unique, but there are very few like it and they are mainly in the US,” says Marron, citing a deal between Novartis and Cephalon as an example. “This is a win-win deal which brings us the support of a much bigger organisation, but one that knows what it is like to be a smallcompany.”
Immutep (Orsay, France) specialises in targeted protein-based immunotherapeutics and has recently announced encouraging phase I/II clinical trial (one of seven trials) results for IMP321 combined with paclitaxel in metastatic breast cancer. Dr Frederic Triebel, scientific and medical director, says that the immunostimulation with first line chemotherapy is a new approach in oncology. “We are hoping to get a partner because clinical trials are very expensive and take a long time,” he said.
Another company with an innovative product on offer is Genticel (formerly BT Pharma, Labge-Innopole, France). Their cervical cancer vaccine, ProCervix, can be offered to women already infected with HPV and has recently been approved for phase I clinical trials. Dr Benedikt Timmerman, Genticel’s chief executive explained: “We want to cure the infection before cancer sets in. Our product compliments the prophylactic vaccines currently on the market.” Genticel hopes that their “first in class” platform will attract a pharma partner. “We have the capability to bring this therapeutic vaccine to market on a global and regional basis. It is going to be a market of similar value and size as Gardasil so we need a big partner. The type of deal we are interested in would involve licensing with co-development or purchasing the whole HPV franchise. We are very open to different types of deal.”
Each major pharma company applies their own unique approach to partnering. Dr Axel Maibuecher, head of Search and Evaluation for Integrated Hospital Care at Novartis, says his company has a “three-dimensional” pathway involving stage of development, deal stage, and therapeutic area which “ensures that an opportunity gets the right expertise”.
Novartis has several different franchises and business units, including cardiovascular and metabolism, neurology and ophthalmology, respiratory and oncology. Novartis is therefore looking for opportunitiesin type II diabetes, obesity, dyslipidemia and antihypertensives.
Neurodegeneration is another strategic focus and Novartis also has an “opportunistic eye open” in old age psychiatry and mood and anxiety drugs with a new mode of action. In ophthalmology, they are interested in wet AMD, from the strategic perspective, and in dry eye from the opportunistic side. Novartis has a long track record in transplantation drugs and is interested in biomarkers in this area. “We are very flexible in the type of deal we will do,” said Maibuecher. So these will include mergers and acquisitions, research collaborations and licensing.
Merck Sharp & Dohme
Meanwhile, Merck relies heavily on the activities of its scientific scouts in partnering, said Dr Barbara Yanni, VP and chief licensing officer.
In 2009, the company signed 51 licensing and partnership deals. “Merck led the field in biotech partnering between 2005 and 2009,” she said.
We expect to do a lot of deal making in the future. The scouts operate worldwide, each taking responsibility for their own area. Also presenting at the conference was Dr Margaret Beer, senior director forexternal scientific affairs, worldwide licensing at Merck Sharp & Dohme. She said: “This is simply the best job in the world.” There are 17 scouts in Merck’s worldwide network, all of them senior scientists. “Scouting and licensing and the science are so important that we will take scientists from the bench to do it,” Beer added.
Merck is interested in all stages of the drug development process. The scouts build close relationships with the local science community including companies, VCs and academics, and they look in all therapeutic areas. “The most important part of my job is relationship building.”
Beer adds: “We are as much dependent on our partners as they are on us, however small the company. I like to think of myself as the friendly face of Merck in the region.”
What is Merck looking for? The company’s areas of interest are published twice a year, and they are interested mainly in phase III and beyond in all therapeutic areas. Dr Manfred Horst is the Merck scout for France and Germany. He gave the example the development of their deal with ElexoPharm, which is a spin-off from Saarland University in southern Germany. ElexoPharm’s synthase inhibitors were on Merck’s list but were originally too early stage to be of real interest. But scientific meetings were held between the two companies and when ElexoPharm published a milestone paper in the Journal of Medicinal Chemistry, the deal was completed in April 2010. This deal covers development and commercialisation of drug candidates targeting aldosterone synthase, a novel target, in cardiovascular disease.
Dr Jeroen Tonnaer, the Merck scout in Benelux, Israel and South Africa said they always look to see how opportunities in the outside world might fit with the Merck development pipeline. “We are looking fordrug candidates in unmet medical need, for novel validated targets which are first in class or best in class, and solid IP on the target.”
They are also interested in new synthetic routes and polymorphs of drug compounds. A biomarker strategy is a plus because it offers the possibility of companion diagnostics. The company is also interested in any technology that helps do things faster, better and cheaper. “More significantly, any technology that will help us identify or validate novel targets is very welcome,” Tonnaer added.
Another interest area is formulation and delivery technologies, as well as improved manufacturing approaches and new therapeutics modalities like RNAi.
“Emerging markets are an important part of our strategy,” added Tonnaer, listing Turkey, Brazil, India, Russia, China and Korea as examples. They are also interested in Asia Pacific, Latin America, EasternEurope, the Middle East, and Africa.
Kilpatrick concludes by saying there is a definite skillset required in deal making, whichever side of the fence you are on.
“It requires persistence, patience, clarity, communication, access to the right people - and a little bit of luck.”
SIGNING THE DEAL
The importance of the legal agreement between firms means that lawyers play a vital role in the process, usually representing biotech firms.
John Wilkinson, partner at London law firm Reed Smith says setting up a partnership is a painstaking process which typically takes six to nine months. First, the company with the asset will decide on a deal structure, then start looking for a partner, making partnering events like BPE extremely important. When a certain level of interest is generated, the details of the deal will be crystallised in order to define the Net Present Value of the asset.
The next stage is to generate a Term Sheet, a non-binding agreement which sets out the draft terms of the deal. This is where firms like Reed Smith often get involved, acting for biotech companies and typically negotiating with a pharma company’s in-house legal department.
“We help our clients draft a detailed agreement with specific definitions tailored for agreement,” said Wilkinson, adding that it is important to be aware of the very specialised language of life science at this stage.
- Susan Aldridge Ph.D.
European News Reporter
Exciting year ahead as Canadian Biotech leads the way
As I visited many companies throughout the past year I was struck by their dedication and candor having moved through recent economic difficulties. Used to set backs, whether regarding delays for approvals or dealing with daily regulation matters our companies are nimble and effective. It is a fact that if you invested $1 in biotech at the end of 2008, today you would have $1.60, compare that with the TSX composite where $1 invested earned $1.48 in return.
Today I feel our industry is proud and receiving great enthusiasm from investors, and partners alike for a strong year ahead. As our Olympic athletes took to the international stage and owned the podium last year at this time the torch can now certainly be passed along to leaders within our bio-economy. This is our time to shine. The platform is wide open for us to share our story with others, and attracting capital in return. Member companies Acquinox received $25M venture financing, Bioniche experienced a $17M share offering, Protox received $35M in private equity investment, WEX Pharmaceuticals earned a $35M share offering, while Oncolytics enjoyed a $29M share offering, and Cardiome celebrated a $30M milestone payment.
Recently I appeared on CBC Newsworld’s Lang & O’Leary Exchange where we discussed the challenge for the industry in raising capital. It is critical for business to understand that over the recent economic recovery period Canada’s largest publicly traded biotech companies have outperformed the broader market, providing investors a 60% return over the last two years. Quite simply these entrepreneurs are asking for a level playing field when seeking investments.
A recent PwC / BIOTECanada industry forecast confirmed what I have been hearing from member companies for quite some time. 84% of respondents indicated the ability to access capital is the key challenge for the industry to become a stronger global competitor. The industry considers a variety of short-term, market-oriented incentives from government to be most helpful. 78% believe government must create incentives for risk capital. Canada’s flow through shares (FTS) program enacted in 1954 has successfully encouraged investment in high-risk natural resource exploration. Similar to junior mining companies, Canada’s junior biotechnology companies require a tremendous amount of time and risk capital to reach profitability. We know that permitting such biotechnology companies to issue FTS would stimulate more research investment, jobs, and commercialization of high-tech goods and services in Canada.
Canadian companies continue to build their operations and perform the majority of their R&D here. Nearly 25% of non-revenue earning companies believe it will take over five years for their companies to earn revenue (similar to 2009 and 2007). 74% of respondents indicate their next financing round will be spent primarily on R&D. The opportunity for Canada is to create the operating environment incentives to ensure the research is conducted primarily in Canada. Refundable research tax credits such as those currently under review by the federal Expert Panel will be key to Canada’s competitiveness. BIOTECanada encourages removing the CCPC restriction from the SR&ED tax credit program.
This will be a banner year for the many biotech companies as we continue to push the envelope on a number of possibilities. I look forward to meeting many of you at BioPartnering North America this is an opportunity to seize upon our success to date. The bragging rights are ours for the taking.
- Peter Brenders
President and CEO, BIOTECanada
About BIOTECanada
BIOTECanada is the national non-profit association dedicated to building the bio-based economy in Canada. From cleaner energy to sustainable agriculture; from greener manufacturing to life-saving health therapies, Canadian biotech firms are discovering ways to revolutionize the economy and improve our lives, everyday.. For more information, please visit: http://www.biotech.ca/
British Columbia’s Life Sciences Sector: Leading the Great White North?
The perception of Canada on the international stage is often tied to its proximity to the US, its rich natural resources, and less than desirable climate. Although this may be true at least in part - the global recession has forced many countries to re-examine their competitive positions and in this regard, Canada has chosen to pursue a path which will strengthen its knowledge-based economy and enhances its capacity in the areas of therapeutic development, energy, agriculture and the environment.The objective of this blog entry and my three subsequent entries is to provide some insight into the knowledge-based economy of this country with a particular focus on life sciences.
Private sector biotechnology within Canada is comprised of about 670 companies generating a direct economic impact of about $1.1 billion CAD annually. The segments encompassed within the sector include (in order of size): - industry/environment, therapeutics, agriculture, and genomics.- The historical epicentre of life sciences within Canada has been in Quebec albeit one-third of all Canadian biotechnology companies now reside in British Columbia (BC).
A recent economic impact study undertaken by LifeSciences BC suggests the provincial sector accounts for $500 million in direct expenditures and employs approximately 7,500 people. It should be stressed that these national and provincial figures represent a fraction of the total market which would take in to consideration direct, indirect, and induced impacts.
What makes BC so attractive to life sciences companies?
The BC Progress Board recently released its Tenth Annual Benchmark Report, noting several of these factors which include but by no means are limited to:
- Health outcomes in BC are better than anywhere else in Canada, pointing to the expertise resident within its medical system. The Province has one of the most diverse ethnic populations, the highest life expectancy, and the lowest cancer mortality rates.
- Access to healthcare and a centralized database in areas such as oncology and pharmaceutical prescriptions make Canada’s most westerly Province an ideal “living laboratory” in which to conduct research, particularly for specialized populations or even post-marketing and surveillance studies.
- Environmental quality in BC is second to none. Protected areas, government policies, and a strong social sensitivity lends itself to a comprehensive approach to ecosystem management, which amongst other initiatives, is strongly supportive of alternative energy sources such as biofuels.
- A vast expanse rich in resources means biofuel and bioproduct organizations can be in close proximity to relatively secure sources of feedstock originating from forestry, agriculture and even municipal waste.
- Insofar as human capital, the percentage of BC’s population possessing a university degree is only second to that of Ontario.
Having provided some context insofar as Canadian and BC life sciences, the next three blog entries in this series will delve further in to a number of critical success factors for the sector; namely capital, collaboration and convergence. It is my hope that such information will serve as a catalyst for you to attend BioPartnering North America 2011 and explore the numerous opportunities that exist for you and your organization.
- Don Enns
President, Life Sciences British Columbia
About Life Sciences British Columbia
LifeSciences British Columbia supports and represents the biopharmaceutical, medical device, bioproducts & bioenergy, and greater life sciences community of British Columbia through leadership, advocacy and promotion of our world-class science and industry.. For more information, please visit http://www.lifesciencesbc.ca
China Blog Series Part 4: Questions Still Remain
This is part 4 of a 4 part blog series featuring growth, challenges and predictions for China’s emerging life science industry:
Will Novartis’ USD 1 billion investment finally shame domestic Chinese pharmaceutical companies into making real commitments to innovative R&D?
The Chinese government, via funding programs such as the 863 National High Technology Research and Development Program, the 973 Major State Basic Research Development Program of China, and the “Torch” technology development program, has committed significant resources to developing basic and applied research germane to innovative drug discovery and development (among other areas). In spite of this support, China remains sluggish in producing innovative (Western) drugs. Part of the blame for this surely lies at the feet of China’s domestic pharmaceutical industry, which, as a whole, has failed to substantially nourish or reward local drug development and, in particular, commercialization efforts. To be sure, the new healthcare reforms will likely reward China’s larger drugmakers with no increased R&D efforts on their part; but, as foreign big pharma steps up R&D in China and lures an increasingly large portion of the nation’s scientific drug discovery and pharmaceutics talent, will local drug companies be content to be passed by and play the generics game indefinitely? Novartis’ announcement may compel local Chinese pharmas (and their government stakeholders) to answer this question sooner rather than later.
What is the real significance of the Novartis announcement?
Regardless of whether the CNIBR yields significant returns in years to come, the magnitude of Novartis’ commitment constitutes a statement which cannot be ignored. At the very least, it is an affirmation of the importance of the Chinese pharmaceutical market to Novartis ��� and by extension the global pharmaceutical industry ��� going forward. While it is perhaps too early to judge, the investment may also mark a watershed moment for the pharmaceutical R&D space in China ��� an indicator that it has reached the next stage in its evolution. Does Novartis believe that new, innovative drugs will come from China? One billion dollars is a lot to spend if they don’t.
- Dr. Jon Zifferblatt
Managing Director, General Biologic
About General Biologic
GBI is an information and professional services firm founded in China in 2002. With more than 30 professionals in Shanghai, our business is providing critical data and advice covering China’s pharmaceutical, biotechnology, and healthcare industries. Our goal is to create a transparent operating environment for our clients, and provide the insights into the competitive landscape they need in order to capitalize on the tremendous opportunities available in China. Our clients depend on the news, data, and analytics we provide to make informed decisions every day. GBI’s clients include most multinational pharmaceutical companies and a leading group of biotechnology companies, healthcare companies, investors, consultants, law firms and financial analysts. For more information, please visit http://www.gbipharma.com/.
China Blog Series Part 3: One billion reasons why pharma R&D in China has reached the big leagues?
This is part 3 of a 4 part blog series featuring growth, challenges and predictions for China’s emerging life science industry:
Subject to the same questions as other R&D commitments
One year later, the CNIBR expansion is still unfolding. Details of exactly where and how the funding will be spent have yet to be released. As with many of the MNC R&D center efforts that have come before, it remains possible that the amount of cash earmarked for innovative drug R&D may be allocated over a long period of time and be only a fraction of the total commitment. (Even a fraction of one billion dollars, however, is still no small sum.)
Motivations, collateral benefits
Presence in an increasingly important market: Novartis is of course buying much more than a just research facility with its investment. With a pharmaceutical market that is poised to become the world’s second largest over the next decade (worth USD 109.5 billion by 2020), China is a focus of increasingly intense interest for all multinational drugmakers. Having a major presence — a presence which extends beyond commercial/sales/regulatory functions to include manufacturing and now, R&D — is becoming increasingly important. (The black box of distribution will likely remain outside company walls for the near- and mid-term, unless centralized procurement is able to engender significant transparency.)
Goodwill: Like other such investments by MNC pharma, Novartis’ CNIBR commitment is also motivated by a desire for governmental goodwill. With new national and regional pricing and reimbursement lists, expansion of government health insurance and community healthcare, and increased oversight of hospitals, tendering, and prescribing- it is clear that China’s healthcare sector will remain a highly regulated one, and issues of market access will be critical for any company seeking to enjoy the fruits of China’s expanding pharmaceutical market.
Recruiting: The CNIBR, now headed by Dr. En Li, will also allow Novartis to extend a sizable taproot into China’s PhD and pharmaceutical research scientist talent pool. While this pool has undoubtedly grown larger in recent years, new R&D centers built by multinational pharmas and the expanding presence of CROs has rendered competition for skilled research staff increasingly stiff. A marquis investment such as the CNIBR will likely give Novartis an extra edge, beyond simple compensation, in attracting top talent.
Implications for the sector as a whole
Novartis’ headline-grabbing CNIBR announcement will likely accelerate a number of (already occurring) trends in the pharmaceutical research sector: Outsourcing activity moves west (or at least out of Shanghai and Beijing): As mentioned above, the Novartis investment, and others like it, will serve to raise the stakes in luring skilled scientists and increase salary expectations across the board. Contract research shops and as well as MNC pharma functions depending on lower-cost R&D manpower will be forced to move to markets where wages remain at lower levels. This phenomenon is already occurring. Excel PharmaStudies’ (now part of PPD) selected Taizhou City for its new biometrics center and several notable deals have been signed involving Wuhan’s Biolake including WuXi PharmaTech’s USD 100 million commitment to build a 40,000 square meter CRO facility and Pfizer’s newly opened radiation biology facility (with current staff number of 40 which is expected to reach 200 over the next two years). Nanjing has also become a locus of increasing amounts of CRO activity.
Number and quality of students studying pharmaceutical-related sciences will rise: Like the westward shift of CRO bases, this phenomenon is already underway; for example, the number of students enrolled at the Shanghai Institute of Biological Sciences (SIBS), a leading center of postgraduate training in fields related to pharma R&D, has more than doubled over the past decade from 723 students (including 394 PhD candidates) in the year 2000, to 1467 (973 PhD) in 2008. Novartis’ high-profile investment will likely give an added boost to the growing amount of young talent choosing the pharmaceutical R&D-related fields.
Follow-on commitments for more infrastructure/acquisitions, both R&D and otherwise: While most research-based MNC pharmas have likely already planned spending increases for China in the future, the CNIBR announcement may have galvanized boards and CEOs to consider the timeframe of their China strategies. Novartis has made a major play on a key area of the global pharmaceutical chessboard, the rest of big pharma will need to consider if it will respond in kind. Some have already done so — Sanofi-Aventis announced in April that it will establish an Asia-Pacific R&D center in Shanghai; others have made non-infrastructure investments that can still provide access to Chinese talent and novel compounds, such as Lilly’s planned venture capital fund to provide financial aid to early-stage research programs in Chinese universities.)
- Dr. Jon Zifferblatt
Managing Director, General Biologic
About General Biologic
GBI is an information and professional services firm founded in China in 2002. With more than 30 professionals in Shanghai, our business is providing critical data and advice covering China’s pharmaceutical, biotechnology, and healthcare industries. Our goal is to create a transparent operating environment for our clients, and provide the insights into the competitive landscape they need in order to capitalize on the tremendous opportunities available in China. Our clients depend on the news, data, and analytics we provide to make informed decisions every day. GBI’s clients include most multinational pharmaceutical companies and a leading group of biotechnology companies, healthcare companies, investors, consultants, law firms and financial analysts. For more information, please visit http://www.gbipharma.com/.
China Blog Series Part 2: More recent commitments - First slow steps towards innovative R&D
This is part 2 of a 4 part blog series featuring growth, challenges and predictions for China’s emerging life science industry:
As early as 2006, AstraZeneca announced a USD 100 million commitment to create the company’s Innovation Center China (ICC) to be located in Shanghai. To be sure, the company did establish an initial lab facility in 2007; however, moving forward, it seems that a significant portion of committed funds will be used to construct AZ’s China headquarters as well as training facilities an regional offices. A Phase II, in which the ICC will undergo and expansion and move into a purpose-built facility, is slated for completion by 2012. GlaxoSmithKline’s China R&D center has followed a similar course of steady but slow growth. In 2007, GSK announced the establishment of a USD 40 million Shanghai R&D center which, among other functions, would serve as the company’s primary center focusing on neurodegenerative disorders. As of 2008, the company had increased its staff from 170 to 200 and stated its intention to double this number by the end of this year, as well as pursue drug discovery efforts in addition to pre-clinical and clinical trial support.
AstraZeneca and GSK’s commitments to scientific infrastructure in China are not unique- many other MNC pharmas including Genzyme, Sanofi-aventis, Johnson & Johnson, and recently both Merck-Serono and Boehringer-Ingelheim, (with planned funding levels of EUR 150 million and 100 million respectively) have established (or plan to establish) R&D bases in mainland China. Novo Nordisk has not surprisingly doubled down on its China R&D presence, announcing plans to increase the workforce at its Beijing center from 100 to 200 employees by 2015. In many cases, the funding windows stretch over extended periods of time and resources are only partially allocated to what can be considered to be innovative drug discovery research, with sizable portions also earmarked for later-stage drug development, training, and regional R&D and administrative capabilities. While the past five years have seen a healthy dose of fanfare and flag-waving by both Chinese scientific bodies and big pharma concerning novel drug R&D, many efforts are still only tentative first steps. Much attention has been given to seven and even eight figure funding commitments; however, significant portions of these monies may in fact go towards non-innovative, or even non-R&D related activities.
There is little doubt that R&D investments in China have edged ever closer to backing integrated novel drug discovery efforts, but China has yet to claim a seat at the table among the world’s major pharmaceutical R&D centers… until now?
- Dr. Jon Zifferblatt
Managing Director, General Biologic
About General Biologic
GBI is an information and professional services firm founded in China in 2002. With more than 30 professionals in Shanghai, our business is providing critical data and advice covering China’s pharmaceutical, biotechnology, and healthcare industries. Our goal is to create a transparent operating environment for our clients, and provide the insights into the competitive landscape they need in order to capitalize on the tremendous opportunities available in China. Our clients depend on the news, data, and analytics we provide to make informed decisions every day. GBI’s clients include most multinational pharmaceutical companies and a leading group of biotechnology companies, healthcare companies, investors, consultants, law firms and financial analysts. For more information, please visit http://www.gbipharma.com/.
China Blog Series Part 1: One Billion Dollars — One Year Later
This is part 1 of a 4 part blog series featuring the growth, challenges and predictions for China’s emerging life science industry:
During his visit to China in November of 2009, Novartis Chairman and Chief Executive Officer Daniel Vasella made a stunning announcement: Novartis would commit USD 1 billion to expand and upgrade its Shanghai laboratory facilities to create the China Novartis Institute for BioMedical Research (CNIBR) in Shanghai. The facility joined NIBR institutes in Basel and Cambridge (Massachusetts) as Novartis’ third major international research facility. A number of multinational pharmaceutical companies have established R&D centers in China over the past several years, but many of these have essentially been low cost development outsourcing operating under company flags. In addition to being an order of magnitude larger than any past R&D commitment to China, Novartis indicated that the CNIBR would constitute the “third pillar” of the company’s global R&D efforts. Pharmaceutical research in China has come a long way over a comparatively short period of time — from early days of disorganization at the turn of the millennium to the rapid expansion of CRO/outsourcing services over the past five years and now the largest ever commitment to China R&D to date. Did the Novartis investment signal the next stage in the evolution of Chinese innovative pharmaceutical R&D? And, what will be the ongoing impact of this investment on the sector as a whole?
As recently as 2002, the China R&D landscape resembled “primordial soup” plenty of energy and potential, but little in the way of organization or scale. In these early days, hundreds of biotech companies struggled with mixed models — attempting to subsidize drug discovery (or even generic development) with services to other biotechs, universities, and pharmaceutical companies. Institutes competed with and were often indistinguishable from companies for outsourcing work and discovery capital. Quality was highly variable, even within the same laboratories at different times. Most biotech companies themselves did not know what other companies were in the same space. When asking multinational pharmaceutical firms about the R&D landscape in China, the common reply was an incredulous question, “there is R&D in China?”
Multinationals’ interactions with China’s R&D landscape at this time were directed out of headquarters, with only small earlier stage cooperation with institutes and companies. While clinical trial outsourcing had taken place for some time (and with a varying amount of sophistication), chemical synthesis outsourcing was rare, animal studies practically nonexistent, and molecular biology experiments at tiny scale.
The Past Decade
While the commercial organizations of most major MNC pharmas have been on the ground in China for some time, most R&D divisions did not take serious notice of China until the emergence of chemistry and clinical trial CROs offering viable low-cost drug development solutions in the early years after the beginning of the millennium. Overseas listings of Chinese R&D service providers, the arrival of foreign CROs in both WOFE and JV form, and the expansion of offerings along the drug development value chain to include biology and preclinical/animal services have all served to raise the profile of the sector and attract increasing shares of pharma R&D budgets.
Early R&D Investments: Outsourcing by another name
Beginning with Lilly’s partnership with ChemExplorer and the opening of their Zhangjiang facility in 2003, many early R&D facility investments by MNC pharmas in China were part of off-shoring drug development strategies with little expectation (or capability) of producing a made-in-China novel drug. Pfizer’s China Research and Development Center, which opened with much fanfare in Shanghai in October 2005 with a planned investment of USD 25 million, is another example of this early model. While the China Research and Development Center name may suggest broad drug R&D functions, the center’s main functions have largely been statistical and biometric support of global clinical trials as well as in-house GCP training.
- Dr. Jon Zifferblatt
Managing Director, General Biologic
About General Biologic
GBI is an information and professional services firm founded in China in 2002. With more than 30 professionals in Shanghai, our business is providing critical data and advice covering China’s pharmaceutical, biotechnology, and healthcare industries. Our goal is to create a transparent operating environment for our clients, and provide the insights into the competitive landscape they need in order to capitalize on the tremendous opportunities available in China. Our clients depend on the news, data, and analytics we provide to make informed decisions every day. GBI’s clients include most multinational pharmaceutical companies and a leading group of biotechnology companies, healthcare companies, investors, consultants, law firms and financial analysts. For more information, please visit http://www.gbipharma.com/.
A Shifting Paradigm?
I’ve just returned from Brazil, where I spoke at the BioPartnering Latin America conference about the value of alliances across industry and nonprofit groups in addressing global health needs. What struck me about this meeting—and those who attended—is the increasing acceleration of interest in and commitment to partnerships in the emerging market countries by large pharma and biotech companies.
The attendance at this meeting was virtually a who’s who of Big Pharma—Merck, Astra Zeneca, Pfizer and many other big companies, as well as biotech companies like Genzyme—that are all looking for partnership opportunities. One of the companies’ goals is to have 25% of total sales come from emerging markets within five years (from 5% only a few years ago and 15% today).
What is clear is that Brazil specifically, and the emerging markets in general, represent far more than just a “market” or revenue opportunity. In addition to their growing economies, many of these countries offer patient populations for clinical trials (as the U.S./EU areas become saturated and harder to identify qualified and willing patients), infrastructure generally and manufacturing specifically, rising awareness and protection of intellectual property, and increased willingness to apply resources (read: money) toward not only purchasing, but also researching and developing new therapies, vaccines, and diagnostics.
This interest in emerging markets — as the developed world markets reach peak maturity and pipelines (for now) are not as productive as industry would like — is of course not new. And the enhanced capabilities in these countries are not as fully developed as both locals and big companies would prefer, but the trend is clear, and continuing.
From BIO Ventures for Global Health’s point of view, we see this momentum as very positive, in two respects. First, the rising clout of emerging markets speaks well for the increasingly close relationships of industry with partners in these countries. Second, and more importantly for our mission, these relationships can provide an increase in resources, opportunity, and awareness of neglected diseases in these countries. In relative terms, these are much larger problems than in the developed world and can become higher priorities in the developed world. In other words, as we grow closer, our partners problems become our problems.
At the Brazilian conference I attended, words like “innovation,” “world-class science and technology,” and “partnering” (as opposed to more one-sided relationships) were the words of the day. Sounds like a typical U.S., European, or Japanese partnering session. This can only be beneficial for the global health needs of patients in emerging countries and their neighbors as relationships grow, mutual needs are exchanged, and solutions pursued.
- Don Joseph
Chief Operating Officer, BIO Ventures for Global Health
About BIO Ventures for Global Health
BIO Ventures for Global Health is a non-profit organization whose mission is to save lives by accelerating the development of novel biotechnology-based drugs, vaccines, and diagnostics to address the unmet medical needs of the developing world. The organization spurs biotech industry involvement in global health product development by increasing biotech and global health partnerships, designing and advocating for compelling market-based incentives, and synthesizing and disseminating critical information and quantitative analysis. For more information, please visit http://www.bvgh.org.
Australian Biotech Companies are Attracting Attention on the World Stage
The biotech industry globally is showing resilience despite challenging conditions, especially in accessing capital, to continue their journey through research and development to creating global solutions. Australian biotech companies are increasingly attracting attention on the world stage.
Australia’s number of listed biotech companies has grown from 30 in 1999 to 112 a decade later. In comparison the US has within the realm of 330. The Australian biotechnology sector ranks sixth in the world and in the past months has seen some milestone announcements, such as Acrux’s AUD $366.7 million deal with Eli Lilly for the commercialisation of its Axiron treatment.
The global financial crisis has seen more Australian biotechnology companies looking toward alternative methods of financing to capitalise on global opportunities. Australian public companies are increasingly attracting international investment from US and European companies through creative methods of financing.
In the current economic climate, investors are looking for higher, alternative sources of income. Creative funding, including hybrid investments, royalty investments and debt equity investments, provide companies with flexible and less expensive sources of capital to fund their commercialisation or development efforts. Interest in traditional forms of capital is waning during these tough economic times. Smart biotechnology companies are revaluating their finance options and increasingly taking a more creative approach, with excellent results.
Creative global investors will outline new developments and innovative financing options from an international perspective at the year’s industry conference for Australia and Asia Pacific AusBiotech 2010. The conference attracts over 1400 delegates from across the world each year and is renowned for its agenda-setting programs, significant business analysis and world-class Business Matching Program.
Immediately preceding the conference, AusBiotech will host a showcase of local companies at the Australasian Life Science Investment Summit 2010 - providing a one-stop shop for investing in the region. The event provides a snapshot of 40 local biotechnology companies; featuring 20 late-stage companies and 20 of the most promising early-stage companies and giving investors one day of summit program followed by three days of conference program.
Last year’s event was the largest of its kind in this part of the world, with more than 100 investors attending, representing 85 different companies; 32 of which were international participants. The summit attracted a wonderful mix of expertise from national and international investors, including angel investors, venture capitalists, fund managers, investment bankers and representatives of superannuation funds. Venture capital arms of the major pharmaceutical and biotechnology companies from Australia, the Asia Pacific region, North America and Europe also attended.
Australasian Life Science Investment Summit, 19 October 2010
Melbourne, Victoria, Australia
http://ausbiotech2010.com.au/alsis-home
AusBiotech 2010 National Conference, 20 - 22 October 2010
Melbourne, Victoria, Australia
http://ausbiotech2010.com.au/
I hope to see you in Australia in October!
Dr. Anna Lavelle
CEO, AusBiotech
About AusBiotech
AusBiotech is Australia’s biotechnology industry organisation, which represents over 3,000 members, covering the human health, agricultural, medical device, bioinformatics, environmental and industrial sectors in biotechnology.
Latin America is Now Becoming a Reality
The worldwide life science community has been witnessing the emergence of many new biobusiness hotspots and the fast movement towards a truly global biotechnology industry. In this scenario, technology, people and capital will continue to be key success factors alongside the ability to leverage strategic partnerships and alliances, without borders. Latin America is well placed to be a major player and partner in building global value in the biobusiness arena.
Life sciences in Latin America is now becoming a reality. After 20 years following and analyzing the market, especially in Brazil, what we see is a very positive scenario:
- Innovation - There is a rapidly growing community of start-ups founded by highly qualified scientists
- Financing - Start-ups are financed in the initial phases by governmental programs that have become available in the last few years
- Large Companies - Large pharma and others are now investing and partnering with innovative projects in the region
From abroad, we see — and support them in our consulting area — more and more large pharmaceutical, industrial and agro companies looking for projects and partners, and medium/small companies looking to capitalize on the opportunities in the region. All of these groups seem to be happy with what they find here: good science, a better regulatory environment and strong support from governments.
The Brazilian life science industry has experienced an unparalleled growth rate: 80 new companies were created in the past 5 years. This is not, however, an arbitrary phenomenon, but rather the confluence of government support and political will, a mature scientific community and a blooming venture capital industry. Although a bright future lies ahead, the country is already yielding good results and success cases.
In 2008, the Brazilian life science industry generated an estimated amount of US$ 400 million in revenue and US$ 55.5 million in profits. The country’s achievements in renewable fuels and agricultural biotechnology have attracted many investors and multinational companies, leading to an increasing number of acquisitions and partnering deals in the past couple of years. The global economic crisis has also had a positive impact, reducing the traditional focus on US-Europe towards emerging countries.
What’s happening today in Latin America, what are tomorrow’s opportunities? Join me and other life science leaders from Latin America and around the globe at the 1st Annual BioPartnering Latin America, 19-21 September, Rio de Janeiro, Brazil.
I’ll see you in Rio this September!
Eduardo Emrich Soares
President
Biominas Brasil
About Biominas Brasil
Biominas is a company dedicated to create and develop life science companies in Brazil. Established in 1990, Biominas is recognized as the most successful institution acting on the support of new life science ventures in Brazil.
We support companies during their entire lifecycle from inception to mature development, offering specialized services such as analysis of business opportunities, identification of potential strategic partners, capital raising and counseling on regulatory affairs and intellectual property. We seek international markets for local companies as well as advise companies in the Latin American market.
What can the Old Spice Guy do for Biotech?
One of the most successful social media campaigns to date has just made its run — and Old Spice is suddenly hip again. Those hilarious Old Spice Guy YouTube videos, corresponding Tweets, and 183 personal video responses posted on YouTube in a span of three days have vigorously turned the brand around.
The campaign fueled Old Spice brand awareness with new audiences and led to a shocking sales increase of 107% in the past month alone!
So, what has made this campaign so successful and what can biotech and pharma learn from it? Here are a few reasons why we think it worked so well:
Conversation
The real key to the Old Spice campaign was that it responded to its audience in a conversational (and entertaining way). The ads debuted on TV driving people to social channels - Twitter and YouTube, and then continued with video responses addressed to the most provocative or interesting questions from the audience to keep interest high. What is clear is that response is critical; it benefits from creative delivery, and ensures that your customers know they have been heard.
Cross Media Integration
The initial TV spots were re-distributed through their YouTube channel garnering over 11M views and amplifying the original campaign. The Old Spice Facebook page received 747,000 likes and Twitter won 95,000 followers. Questions submitted through Twitter were then converted into 183 personal video responses from the Old Spice guy to each individual. It is crucial to be able to respond to your followers where they are and give plenty opportunity for them to find you across all media.
Audience Targeting
Know where your audiences are and what their behaviors are. This campaign spoke to women who strongly influence men’s purchase behavior. Who is influential in your market? How can you get your message in front of them? It may not always be whom you think!
The campaign’s success was based in establishing a direct and meaningful connection with the audience. Whether speaking to patients, investors or partners, it is crucial to have a real conversation and encourage engagement.
Barbara Lavery
President, Zoomedia
About Zoomedia
In 1994 Zoomedia first brought interactive media to the life science industry. Today, we are an industry leader - an industry insider with a deep understanding of what drives your business — and a full-service agency that can translate that understanding into effective communication and success for our clients. What makes us special? Our dedication to patients, our commitment to our clients, our powerful technology solutions, and our unmatched understanding of strategic online programs.
