Focus on biologics
Biologics include a wide range of products such as recombinant therapeutic proteins including antibodies, vaccines, blood and blood components, allergenics, somatic cells, gene therapy and tissues. Biologics can be composed of sugars, proteins, or nucleic acids or complex combinations of these substances, or may be living entities such as cells and tissues. Biologics are isolated from a variety of natural sources - human, animal, or microorganism - and may be produced by biotechnology methods and other cutting-edge technologies. Biological products often represent the cutting-edge of biomedical research and, in time, may offer the most effective means to treat a variety of medical illnesses and conditions that presently have no other treatments available.
Biologics have certain advantages over small molecule drugs, which are typically synthesized chemically, including their higher development success rate and better resistance towards generic competition. Often these products target areas of high medical need. Therefore, eight out of the top ten selling drugs in 2016 and almost half of the top 100 products were biologics. At the same time, a large part of the innovation in this space occurs in academic centers and emerging biotech companies, while larger pharmaceutical companies tend to insource such innovation by licensing and acquisitions. This offers a great opportunity for venture capital-backed companies.