Biotechnology is the commercial use of living organisms. The main field of biotechnology is medicine and related products such as vaccines. Biotechnology is used in industries like agriculture, heavy industry and mining with products like biopesticides. Many large pharmaceutical companies have separate divisions for biotech-based medical treatments. Certain of these products originate from living organisms, whereas others are chemically base. This distinction is important as the risk characteristics of these two industries are distinct.
In addition to the risk, a biotech company’s extensive research and development activities can cause it to be costly to operate. A successful drug could generate significant returns on investment. But it could take years for a new product reach the market. The FDA approval process can be complex and time-consuming. It requires preclinical testing as well as clinical trials and quality control. According to Science Daily, only a tiny fraction of the substances that are tested make it to the market.
Biotech firms can choose to focus on technology partnership or develop their own pharmaceutical assets that they out-license to large pharmaceutical companies for manufacturing and marketing. Most young biotechs take the latter route because it can boost revenue growth. However, it is not without the risk, however, since they also have to pay for the costs of clinical development and regulatory approval and insurance reimbursement negotiation and sales promotion. To reduce these risks, biotech companies often Click Here rely on strategic alliances with big pharma and smaller biotechnology platform companies. The biotech ecosystem in Massachusetts, for example includes top universities, teaching hospitals and entrepreneur communities as well as venture capitalists.