Posted on 05/15/2013 7:29:27 AM PDT by SeekAndFind
Venture capital investment in American life-sciences innovation is suffering an alarming decline. The number of new biotechnology and medical device companies receiving start-up financing has now fallen to the lowest levels in 18 years, according to PriceWaterhouseCoopers. In recent decades, the cost of developing a single new medicine has grown more than 10-fold, to $1.5 billion. On average, each new drug spends 15 years in development. And only two in 10 successfully commercialized medicines ever earn a return on investment.
Start-ups have played a vital role in the development of an entire generation of cutting-edge new therapies that have revolutionized the treatment of conditions ranging from cancer to cystic fibrosis to heart disease.
But today, many of these small, entrepreneurial biotech and medical device companies are struggling to raise the money they need for research and development.
Faced with ever-escalating time, cost and uncertainty, venture capitalists have started to shy away from start-ups pursuing new drugs and medical devices.
They have no choice, because the pension funds, university endowments and other entities that have driven venture investment to medical innovation in the past are increasingly taking their dollars elsewhere.
Last year, the president's top science advisers noted that private investment in new drug innovation "is under significant stress."
The president's advisers called for urgent focus on reducing the time, cost and uncertainty of developing new medicines. And they highlighted the need to pay careful attention to the incentives for private investment.
"One of the most powerful incentives is exclusivity periods," they noted, "which allow sponsors to recover costs and make profits without generic competition."
(Excerpt) Read more at news.investors.com ...
The FDA, the CDC, HHS, and now Obamacare... it’s a wonder the medical/biotech industries are in business at all.
The 2.3% tax on gross receipts is the equivelent of a 46% tax on a company making 5% profit. If they want to stay in business, how do they cope? Fire the top salaried people. That’s why I’ve been unemployed for nearly 3 years.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.