NEW YORK, Feb. 15 /PRNewswire/ -- The U.S. National Institutes of Health counts nanomedicine as one of its top five priorities, the National Cancer Institute committed $144 million to nanotechnology research in October 2004, and 40% of nanotech venture capital since 1998 has gone to life sciences start-ups. Yet despite nanotechnology's promise in improving how drugs are developed and delivered, major pharmaceutical companies are committing almost no money or people to nanotechnology research -- exposing them to strategic risks, according to a new report from Lux Research entitled "Why Big Pharma Is Missing the Nanotech Opportunity." "Nanotech presents many opportunities to pharmaceutical giants, ranging from better delivery of existing drugs to entirely new therapies based on nanomaterials," said Lux Research Vice President of Research Matthew M. Nordan. "But big pharma is not investing in nanotech today. If this trend continues, nanotech will play out in pharmaceuticals just as biotechnology did, with major pharmaceutical companies leaving money on the table and allowing new competitors to take root." Lux Research bases its conclusions on in-depth interviews conducted with individuals accountable for nanotechnology at 33 global corporations with annual revenues exceeding $5 billion. The interview data reveals that: * No life sciences interviewee rates nanotech as a high corporate priority, as opposed to 78% of interviewees in electronics and materials. * Only one out of six life sciences respondents claims to have an explicit strategy for nanotechnology, compared with two-thirds of those in other electronics and materials. * Big pharma companies on average commit 16 people and less than half of one percent of R&D spending to nanotechnology research, whereas like-sized electronics and materials firms commit more than 100 people and more than 8% of R&D. Lux Research's analysis finds that large drug manufacturers pay little attention to nanotechnology for three reasons: Organization, history, and hubris. First, big pharma companies typically entrust accountability for nanotechnology to an executive responsible for drug discovery, pharma's biggest cost driver -- but nanotech's big near-term impact is in drug delivery. Second, big pharma companies learned during the biotech revolution that they could avoid their own investment and instead in-license drugs from start-ups at a late stage -- but greater pressure on big pharma's drug pipelines today gives nanotech start-ups a negotiating advantage. Finally, many big pharma executives claim they've been "doing nanotech" for years by developing small-molecule drugs or engineering proteins -- however, few can claim the materials science expertise that truly novel nanotech innovations depend on. Pharmaceutical companies' laissez-faire attitude towards nanotech will have consequences. "Big pharma will have to contend with a new wave of superbranded generics that will erode market share. This trend began with the approval of American Pharmaceutical Partners' nano-enabled Abraxane cancer therapy this January," said Nordan. "On the other hand, opportunity exists for a forward-thinking drug manufacturer to go on the offensive and acquire competitive capabilities by picking up a nanoscale reformulation specialist, as mid-cap pharma manufacturer Elan and medical devices leader Baxter already have. We think Kereos in the U.S., Nanocarrier in Japan, and Solubest in Israel look like prime targets." The report provides interview data comparing the nanotech strategy, staffing, and R&D spending of global life sciences companies versus like-sized competitors in the electronics and IT sectors, and also profiles 14 start-up and mid-cap companies developing nanoscale drug delivery technologies. It is available immediately to clients of Lux Research's Nanotechnology Strategies advisory service. For information on how to become a client, contact Rob Burns, Vice President of Sales, at (646) 723-0708. About Lux Research: Lux Research is the world's premier research and advisory firm focusing on the business and economic impact of nanotechnology and related emerging technologies. Lux Research provides continuous advisory services, customized consulting, and reference studies to corporations, start-ups, financial institutions, and public sector organizations. Our founders and our research staff are the most widely recognized nanotechnology visionaries throughout the world. Visit http://www.luxresearchinc.com for more information.
SOURCE Lux Research