As pharma consolidates, biotech leaders rethink development model

With the pharma industry consolidating at a fast pace and markets still slow to embrace new IPOs, some of the leading figures in the biotech industry are starting to rethink the way developers finance drug discovery.

In a recent discussion in Boston, Peter Wirth, Genzyme's executive vice president, said that biotech companies faced a "critical dilemma" in financing the huge cost of R&D. And Steven C. Gilman, Cubist's chief scientific officer, noted that industry consolidation is reducing the competition for pipeline programs, which will in turn significantly reduce the price that pharma companies are willing to pay for new therapies.

These trends may force developers to adopt a "marathon" model of discovery to replace the "relay" model that has been in place for years. "That model worked well until a couple of years ago, when the guy who was supposed to take the baton wasn't there,'' Wirth said.

- read the story from the Boston Globe