Pricing pressures continue for life sciences companies
Triangle Business Journal | July 7, 2017 –
“Doug Edgeton, left, of the N.C. Biotechnology Center and Mike Leary of Clarkston Consulting at a panel discussion on life sciences in Research Triangle Park.
Panelists Doug Edgeton, president and CEO of the North Carolina Biotechnology Center, and Mike Leary, managing partner at Clarkston Consulting, talked about funding, innovation and repatriation at Triangle Business Journal’s inaugural Life Sciences Live event on the morning of June 22 at The Frontier of Research Triangle Park.
When it comes to the biggest challenge currently facing Triangle life sciences companies, Leary said that it’s certainly pricing pressures with, on average, roughly $2.6 billion and about 10 years or more needed to bring a product to market.
“It creates incentives to recoup that investment,” he said, noting there’s need for “some transparency to the public that it’s not just price gouging …”
There is an “inefficient use of capital throughout the life cycle of a product,” he said. “We need to streamline that and make it more effective.”
A second point, Leary noted, is the challenge of making a “transition into the digital age.” With a movement from rewarding for outcomes rather than quantity, substantial responsibility still sits with patients, he said, when it comes to following prescribed regimens for medications, for instance.
“How do you take a life sciences company with innovative skills around research and development of products and combine it with a partnership with somebody about how to engage patients, how to create technology, how to create applications. … To me that’s the big challenge.” He said medical device companies, particularly in the diabetes space, have been active in this arena when it comes to wearables.
As for Edgeton, he said the biggest challenge he sees for Triangle life sciences companies is securing their first $1 million in funding.
“Programs we do at the Biotech Center are designed to help fill some of those gaps, but that money is scarce in North Carolina; it’s hard to come by,” he said, as opposed to markets such as Boston and San Francisco. “And we’re fractions of the cost of being there. … The talent piece is very well-covered here, but I think the money piece is much easier to find in those markets.”