Biotech Conferences Are Where Partnering Agreements Happen Between Pharma and Biotechs

June 19, 2012 by  Filed under: Management 

The biotech conference has always been a place for companies to get together and discuss business. Besides being a sort of neutral ground, it also catches both companies at a time when both are being presented at their best. In that sense a biotech conference would be the perfect place for pharmaceutical company and a biotech firm to do business, especially if they were debating some sort of partnership. In fact, a number of partnerships are forged on the convention floor that are solidified once they head back to the office.

Partnering allows both companies to benefit from what the other does. Biotech firms develop new products all the time. However, frequently the product is expensive to develop even though it may have few people that will benefit from it. They also develop solutions to common problems, but have a problem with some aspect of distribution and/or production Also, although they can do some small-scale laboratory testing, they may have some problems completing the series of tests required by licensing agencies, such as the Federal Drug Administration. They need some form of partnership in order to fully take advantage of their new discovery.

Pharmaceutical companies, conversely, have found that research is something that they do rather poorly in comparison. This is not to say that they do not develop new product, but their size makes it difficult; they not only need to answer to non-scientists, but they need to deal with more non-research issues than a laboratory, both of which slows down research. That is, they need to spend more time justifying the research that is happening, especially when the company has a number of other concerns to deal with.

By partnering, however, they can overcome their weaknesses. The biotech firm develops something, and deals with the preliminary tests while the pharmaceutical company deals with the final tests and distribution. In essence, one has the product and the other has the contacts to make it work. Thus, both kinds of companies are always on the lookout for another, and a conference gives them the chance to look at each other and see if they would be compatible, as well as providing a means for them to vet the other through other companies. Overall it is a very nice arrangement, one that is usually beneficial to both companies and allows them to meet in a much more informal situation leading to the success of both companies.

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