'Big Pharma' feed biotech startups record funds

The biotech industry raised a record $55.8 billion in 2009 despite hesitant stock and venture capital markets, as drug-company partnerships fed the cash-burning startups that develop new therapies.

That represents a jump of 85 percent over the $30.1 billion recorded in 2008, according to Steve Burrill, whose San Francisco firm Burrill & Co. is both an industry investor and analyst.

He said the 2009 results were driven by $37 billion in financial partnerships through which large drug companies license technologies or experimental remedies from biotech startups, a dynamic that enabled many small firms to survive a tough year. But it may ultimately limit their growth if they were forced to cede control over their most promising developments.

"You're not going to grow a lot more Genentechs or Amgens," Burrill said, painting a picture of a biotech industry that is increasingly the farm team that develops remedies that will ultimately be licensed and sold by the major league drug companies, also known as "Big Pharma."

That's the snapshot of the industry that emerges as 6,500 scientists, executives and financiers converge on San Francisco this week for the JP Morgan Healthcare Conference.

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Drugmaker Glaxo cuts back on seminars for doctors

* Company cuts out commercial medical education companies

* Only about 20 accredited providers will get grants

Drugmaker GlaxoSmithKline (GSK.L) said on Monday it will pare back funding for continuing medical education seminars.

While the company did not link its decision to political developments, pressure has been mounting in Congress and among some medical journal editors to limit the drug industry's influence over doctors.

Deirdre Connelly, president of Glaxo's operations in North America, said in a statement that starting in 2010, the company will limit its support for medical education programs, funding only independent programs with "the greatest potential to improve patient health."

The company said it will cut out education programs put on by commercial providers, and will only pay for programs from about 20 medical education providers with a track record of quality.

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Drug companies seek a cure for their ailing research. With costs and regulation rising, a new way of developing blockbuster treatments is needed.

THERE was warm applause for Lord [James] Black last month when the veteran drug developer stepped up in front of an 800-strong audience of business leaders and VIPs in the City to collect an award. The Nobel prize winner was being honoured by Medical Futures, a healthcare interest group, for his contribution to medical research — he is responsible for developing beta blockers, among other significant breakthroughs.

However, Black wonders whether, if he had been in his professional prime in today’s environment, his various discoveries would have happened. He argues that a safety-first approach is hindering the development of the next generation of blockbuster drugs.

“The problem, in my recent experience of trawling new products round big pharma’s R&D divisions, is that they are only comfortable in well-recognised fields,” he said.

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