How Bioscience Platform Companies mature into Focused Product Businesses

In this final instalment of our 3-part series, we look at bioscience platform companies as they mature into focused product businesses. What drives this transition? What are the key success factors as a focused product business? This article covers in more detail Stage 4 of the lifecycle of bioscience platform companies depicted below:

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Bioscience Platform Companies as Technology/Service Providers and Hybrid Businesses

In this second instalment of our 3-part series, we look at the adolescent and early adulthood stages of bioscience platform companies. What drives the transition to these stages? What are the key success factors during these stages? This article discusses in more detail Stages 2 and 3 of the lifecycle of bioscience platform companies depicted below:

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Bioscience Platform Companies and their Lifecycle

What are bioscience platform companies? And how do they eventually develop into fully-fledged product businesses? Most industry participants, commentators and investors recognize and understand start-up biotech companies at one extreme, and fully-fledged pharmaceutical and medical device product companies at the other. However bioscience platform companies are neither. They can be very healthy businesses, yet bereft of product revenues or even profits for many years. And for much of their lifecycle, they can be very difficult for investors to pin a precise valuation on.

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Critical Ingredients at the Outset of Collaboration

A number of critical ingredients need to be in place at the outset of R&D collaborations between smaller biotech/medtech companies or academic research groups (‘David’) with much larger multinational corporations (‘Goliath’). In this second instalment of our three-part series, we discuss how these ingredients greatly improve the chances of success in such collaborations.

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Hidden Reasons for Collaboration Failures

Continued industry-wide decline in R&D productivity has led to the tremendous growth of R&D externalisation in bioscience and health technology over the past decade. In particular, there has been a dramatic proliferation of “David-and-Goliath” collaborations between small companies or academic research groups (‘David’) with much larger multinational corporations (‘Goliath’). But can this ultimately reverse the productivity decline? In this article, the first of a three-part series, we describe (in addition to the usual scientific and marketplace challenges) some hidden reasons for R&D project failures in this sector. Unless the industry gets better at managing these less visible risk factors, the productivity gains from increased R&D externalisation could be rapidly eroded.

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Emergence and Evolution of R&D Alliance Management

As bioscience R&D collaborations have grown in volume and complexity over the last decade, so has widespread adoption of formal alliance management, especially by the larger companies. Yet despite the emergence of formal tools such as balanced scorecards and alliance health surveys, this approach has its limitations. As the nature of many collaborations shifts from outsourcing or intellectual property transfer to true innovation partnerships, formal alliance management needs to be supplemented by other informal ingredients to ensure successful outcomes.
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