Meissner:There are many new industry trends, but very few have broad appeal that haven't already been discussed at some length. One trend that continues to be worth watching closely is how the industry continues to evolve as it faces a shrinking pipeline of promising new drugs, while also facing escalating R&D costs and increasing regulatory scrutiny. In recent years, the trend has been to partner with emerging biotechnology companies. As profitable drugs move off patent, companies are taking a second look at competing with generic competition by tackling that competition head on. They're investing in more efficient processes and, in some cases, even acquiring generic drug manufacturing companies. Key suppliers will also be expected to evolve and will be relied on to bring core competencies to bear more economically than in-house-derived solutions.
How will the industry remain innovative as it reduces spending on research?
Spending less money on research actually increases the need for innovation rather than dampening it. The desire to fund only those projects that have the best chance of commercial success has always been high, but differentiating which of those projects are most likely to succeed remains a very difficult task. Additionally, the path to success with almost every project will likely be challenged at various times by obstacles that are best overcome with innovation.
Smaller, dynamic biotechnology firms have always relied on key suppliers to assist them with innovative solutions to overcome obstacles such as process bottlenecks. Now pharmaceutical companies of every size, many of whom have historically been vertically integrated from R&D through manufacturing, are increasingly relying on partners to conceive cost-effective solutions, effectively outsourcing many challenges. Our customers increasingly rely on us to enhance their R&D and manufacturing efficiency thereby stretching budgets as far as possible.