Top PhD Job Candidates Must Know These 4 New Developments Influencing The Life Science Industry
When I was a PhD student, all that mattered to me was that my experiments went well and that I got my research published.
That was it.
Research outside of my field, or outside of my university, did not matter to me.
And, the academic culture kept me thinking small.
I was honed in on my project and wasn’t too concerned with how it fit into the larger picture.
But, as I progressed through my studies and realized that I didn’t want to do a postdoc, my perspective began to change.
If I was going to get a job at a company, I needed to learn more about the companies I was interested in.
I needed to learn more about the trends and factors that companies use to make decisions so that I could be someone they wanted to hire.
So, I started researching and reading articles about business — as opposed to just reading academic journals.
As I learned more and more about current industry trends, I was able to have great conversations with industry professionals.
Networking became easy, because I had something in common to talk about with these people — it was fantastic.
Taking the time to learn and become knowledgeable about industry trends has had a very positive effect on both my job search success and my industry career.
4 Recent Developments In The Life Science Industry And How Companies Are Adapting
So far, 2018 has been a fruitful year for the life science sector, and the future looks promising.
According to the report, EvaluatePharma® World Preview 2018, Outlook to 2024, the spending on pharmaceutical R&D is expected to continue to increase.
In 2017, the total worldwide spending on pharmaceutical spending was $162 billion and it’s forecast to rise to $202 billion by 2024.
However, we will have to be watchful regarding pressure imposed on the life science industry by external factors, such as: pricing challenges, a new geopolitical climate, and new regulatory guidelines.
Each company within the sector is striving to adapt to these changes and challenges.
Embracing changes and adopting new technologies and policies that will shape the future of the life science industry will be key to any organization’s success.
The industry will also have to continue to deal with the threat of decreasing returns on R&D investments, and increasing competition from biosimilars and generics.
If you are a graduate student in the life science field and you are eager to pursue a career in industry, it is essential to be aware of current trends and upcoming changes in this sector.
It will help you understand the kind of opportunities that will be available in the future and how you should prepare yourself to maximize your chances of success.
Here are 4 trends in the biopharma industry that will influence your job search and future industry career…
1. Massive biopharma restructuring and increased mergers and acquisitions.
Some major players, such as Novartis and GSK, have gone through significant restructuring in the last couple of years.
Novartis decided to sell off about 300 products from its US generics branch, Sandoz, to Indian drug manufacturer Aurobindo Pharma for about $1 billion.
Earlier this year, Novartis sold its share of the consumer healthcare venture to GSK for $13 billion.
The Swiss drugmaker also plans to spin off its eyecare unit, Alcon and move the headquarters to Geneva.
This indicates Novartis’ desire to divert more resources and focus on its core areas of interest.
In further streamlining efforts, Novartis announced that it will cut 2,500 jobs over the next 4 years, mostly from its UK and Swiss offices.
Novartis is not the only pharma giant restructuring.
GSK plans to cut about 650 US jobs and they spent $300 million to acquire a stake in 23andMe, the genetic-testing company.
This signals their growing interest in utilizing genomic data for drug development.
Biopharma mergers and acquisitions (M&A), which showed signs of slowing down in the later part of 2017, have renewed.
In the first 6 months of this calendar year, the combined value of all announced M&A deals amounts to $115 billion, which is higher than the total M&A deals for all of 2017.
The biggest M&A so far has been the Japanese company, Takeda’s $62 billion takeover of the UK’s Shire Plc.
Other noteworthy acquisitions of 2018 include: Celegene acquiring Juno Therapeutics to expand their presence in the immune-oncology space, the acquisition of Flatiron Health by Roche for about $2 billion, and Sanofi acquiring Bioverativ to bolster its rare disease portfolio.
2. Increase in the number of biotech companies going public.
2018 has been an exceptionally busy year for biotech companies going public, as seen in the figure above.
Crunchbase reported that in just the first 6 months of 2018, nearly the same number of IPOs were put forward than in all of 2017.
Most notably, in the 2nd quarter of 2018, there were 16 biotech and healthcare IPOs, while only 11 companies from the Tech/IT sector went public.
This is unusual, as the tech sector almost always has the most IPOs per quarter.
Additionally, at the halfway mark of the current calendar year, the total capital raised by biotech and healthcare IPOs surpassed the amount of money raised in any of the previous 3 complete calendar years, as seen in the figure above.
Globally, 189 healthcare companies went public in 2017.
This year, the number of global healthcare sector IPOs reached about 100 by mid-July and is expected to surpass that of the previous year (189).
Yet another indicator of the growth in the biotech and healthcare sector is the appetite for venture capital (VC) funding.
By the midway mark in 2018, there have been 19 VC investment rounds of $100 million or higher.
One of the main reasons for this infusion of capital in biopharma startups is the successful raising of capital that life science focused VC firms managed in the latter half of 2017.
In the US alone, healthcare-oriented VCs raised over $9 billion in 2017, which represents a 26% increase over capital raised in 2016.
It is also interesting to note that not only has VC funding gone up but, according to experts, it has also become more favorable towards early stage funding.
This is positive news for the development of innovative startups, which are often focused on early drug development and are hence considered more risky investments by VCs.
3. Changing technology means new regulatory initiatives.
With all the growth and advancements in new technology, the biopharma sector is going through a lot of changes.
It has now become essential for regulatory authorities to bring in new rules to keep up with these changes.
Besides the changes in technology, other factors driving the FDA and other regulatory bodies to introduce new laws is the demand for putting a check on healthcare expenses and the call for more transparency.
One of the measures taken by the FDA is to incentivize the development of generics and biologics.
It introduced a new drug designation termed as, “Competitive Generic Therapy”.
If a new drug is introduced into a market where there is insufficient generic competition, this new rule offers it a 180-day market exclusivity.
The FDA also put renewed efforts towards clearing the approval of orphan drugs that resulted in the clearance of a backlog of about 200 orphan drug designation requests.
Since last May, the FDA has also approved 7 biosimilars as a part of its push to bring down the price of medications.
The demand for transparency, data sharing, and increased consumer empowerments has led the FDA to introduce some new regulation in the handling of clinical trial data.
One such new rule is the Civil Money Penalties, which relates to the proper use of the ClinicalTrials.gov Data Bank.
In September 2018, the FDA sent a message to sponsors of clinical studies that they will face penalties if they fail to comply with reporting the clinical study and its necessary details on the ClinicalTrials.gov website.
The FDA has also created the Master Clinical Trials Protocols (known as MAPs) with the aim of increasing efficiency and lowering the costs of clinical trials.
Regulatory authorities are also becoming more cognizant to the use of Artificial Intelligence (AI) in clinical data and trials.
Through one of his public statements, the new FDA Commissioner, Scott Gottleib, highlighted the potential of implementation of new technologies for accelerating drug development, managing clinical trial data, and possibly reducing costs.
The Commissioner also mentioned that the FDA is keen to develop new regulatory policies that will encourage the adoption of AI and foster further innovation
4. New initiatives to lower drug costs for patients.
Lowering of drug costs has been a major agenda of the new US administration.
So far, success has been limited and one of the new options that the FDA is looking into is the possibility of importation of drugs into the US under certain circumstances.
Another factor that is blamed for the lack of availability of lower priced biosimilars is the doubt among consumers and healthcare professionals regarding equivalency of biosimilars relative to the biologics they are meant to replace.
Outside of the efforts of the FDA, in the US, another interesting development associated with drug pricing that made headlines earlier this year was the decision by Bristol-Myers to lower the price of an immune-oncology drug in China.
BMS announced in August that it would sell one of their leading immuno-oncology therapies, Opdivo, at approximately half of the US price in China.
We will have to wait to find out the effects of this initiative, but it signals the growing pressure on drug pricing and importance of the pharma market in emerging economies, such as China.
In addition to the initiatives by regulatory authorities, a method aimed at checking rising prices that is predicted to become more prevalent is the introduction of “Value-based contracts” by payers.
This is also indicative of the biopharma industry becoming more patient-centric.
These contracts associate reimbursement with better patient outcomes over similar competing products.
The National Health Services (NHS) in the UK, and some payers in the US, have already started signing these value-based contracts with biopharma organizations.
As technology, society, and economies change, the biopharma industry faces unique challenges to adapt to these changes. And, as a PhD looking to get hired in industry, being familiar with these challenges and positioning yourself as a person who can help overcome them will make you a very desirable employee. Some of the most recent changes facing the biopharma industry are massive biopharma restructuring and increased mergers and acquisitions, an increase in the number of biotech companies going public, changing technology meaning new regulatory initiatives, and new initiatives to lower drug costs for patients.
If you’re ready to start your transition into industry, you can apply to book a free Transition Call with our founder Isaiah Hankel, PhD or one of our Transition Specialists. Apply to book a Transition Call here.