Mark Ahn Explains Why Some Biotech Startups Succeed, While Others Wither
PORTLAND, Ore., Jan. 13, 2015 /PRNewswire/ -- Throughout his twenty years in the biopharmaceutical industry as an entrepreneur, executive, and consultant Mark Ahn, Ph.D. has seen hundreds of successful biopharmaceutical and biotech companies up-close. And now Ahn and his colleagues are investigating how biotech entrepreneurs and investors identify opportunities early and gain success in an industry that breeds many good ideas but few truly successful companies.
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Most biotechnology startups begin with great promise and generate a lot of excitement with their potentially disruptive and world-changing ideas or products. It is easy to get caught up in the hype about the next possible cure for a debilitating disease or innovation that will revolutionize medical care in developing nations. But in an industry with so many failed companies and ideas that did not pan out, how do investors find profits with biotech companies? According to Mark Ahn and his colleagues, smart investors are likely to forge ties-forming research alliances or acquiring minority stakes, for example-with a broad range of small firms rather than waiting to acquire or license of a single product after it is established and legitimized. Ahn uses the example of companies who invested in two similar drugs: Rituxan® and Vectibix®. Biotechnology firm Genentech licensed Rituxan® for $30 million during the drug's Phase II trials. Amgen waited until Vectibix® was in Phase III trials before it acquired Vectibix® for $2.2 billion.
How do the biotech startups become successful? Mostly by remaining resilient according to Ahn. Long development cycles and the highly regulated nature of the industry means that biotechnology startups usually have to take on multiple rounds of outside funding before bringing a product to market and creating revenue. Ahn notes the advice of Joshua Berger, CEO of Vertex: 'Follow your own business plan. Don't follow the winds that blow back and forth. You can't be successful by following the trends of the moment, especially if your business has a relatively long product cycle, as ours does. It sounds simple, but it's very hard to do. There are so many forces that want to move you off your plan."
To learn more about Mark Ahn's thoughts on what makes biotechnology startups and investors successful read "Biotechnology Innovation: A Legitimacy-Based View" published in the International Journal of Innovation Technology Management at http://www.worldscientific.com/doi/abs/10.1142/S0219877013500156.
About Mark Ahn, Ph.D.
Mark Ahn, Ph.D. is a founding Principal of Pukana Partners, a strategic consultancy for life science companies and professor. During his twenty year career, Mark Ahn has held leadership positions in both small and large biopharmaceutical companies and throughout academia. Ahn is the author of over 50 peer reviewed journal articles and books.
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