Magazine article Management Today

Bioscience Comes off the Shelf and Gets Down to Business

Magazine article Management Today

Bioscience Comes off the Shelf and Gets Down to Business

Article excerpt

The gap between industry and research is closing in Britain's bioscience sector.

It is difficult to fault the inventive skills of British science. The quality of research in our universities can match the best of any other industrialised country. But what we are not good at is turning this scientific cornucopia into saleable, money-making products. The need to overcome this weakness was the dominant theme of the Government's White Paper on science, issued in May. Many of the proposals are sound enough. The Office of Science and Technology, for example, is to be reorganised and 'technology foresight' techniques are to be used to try and identify wealth-creating research.

Improving the institutional framework of scientific research is important but there is no guarantee that the divide between researchers and industrial exploiters will be overcome. There are some areas where progress is being made.

Bioscience, the industrial use of micro-organisms, living plant and material cells to produce substances beneficial to people, is widely seen as having great potential. But until recently its development in this country was faltering. The pattern of events was typically British: a high level of research activity but a poor record of industrial exploitation. Researchers found it difficult to obtain venture capital to exploit their work; the venture capitalists complained that the researchers seldom displayed the necessary management expertise.

American bioscience is one of the liveliest sectors of the stock market. There are 225 companies with a combined market capitalisation of around $35 billion. There have been some disappointments -- but some spectacular successes, too. Amgen's drug for treating chronic anaemia achieved sales of $1.2 billion last year and the 12 biopharmaceutical products on the market have achieved aggregate sales in excess of $4 billion. Barclay de Zoete Wedd's (BZW) US biotechnology stock price index shows that over the past decade investors would have enjoyed average annual compound growth of 16.3%, rather better than the Dow Jones industrial index's 11.1%.

The explanation for the difference between the UK and US, says a recent BZW survey, is a mix of cultural and institutional factors. 'What has been lacking has been an entrepreneurial culture equivalent to that found in the US, sophisticated technology transfer arrangements between academics and commerce, and the flexibility within the financial community to allow emerging companies to obtain London Stock Exchange listings.'

Quite suddenly this picture is changing. …

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