Big Biotech companies proving more valuable

Pharmatimes reports today that big biotech companies are frequently demonstrating that they are better positioned to respond to the needs of the healthcare system than big pharmaceutical companies.

As healthcare shifts towards a new value-based focus biotech companies have been seen to outpace their pharmaceutical counterparts in terms of growth income, investment in R&D and market cap over the past three years, according to analysis undertake by life science financial services firm, Burrill & Co.

“As the industry migrates away from an era of the one-size-fits-all blockbuster, the biotechnology industry’s strength at developing innovative therapies that meet unmet medical needs and target the molecular mechanisms of diseases gives it an upper hand in creating value,” said the firm’s chief executive, G Steven Burrill.

Big Biotech experienced a 57% increase in market cap for the three years ended December 31, 2012, as the total value of the group climbed to $260.6 billion from $160.1 billion at the end of 2009, says the analysis. That compared to a 17.4% increase for Big Pharma during the same period as the market cap for the group climbed to a collective $1,257 billion from $1,070 billion.

“The big jump in the value of Big Biotech companies is not just a matter of investor speculation – these companies have had significant clinical and market successes that have driven their value higher,” Mr Burrill points out.

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