14 Jul BIO 2008 Aftermath: Biotech heading for $100 billion annual business By 2010
The recent BIO International 2008 conference (it should really be called the BIO Global conference), held in San Diego, demonstrated the extent to which the biotech industry has globalized.
With over 70 countries present, the exhibit floor looked somewhat akin to the United Nations with delegations from all over the world. It was, indeed, colorful (and in some cases musical). Additionally, 10 U.S. Governors personally fought for attention and recognition for their home state including host Arnold Schwarzenegger, with 48 states present at the conference. At the end of the day, it was all about economic development. In spite of the fact that the BIO International conference will come back to Chicago in 2010, Illinois Governor Blagojevich was not present, but his Director of Commerce and Economic Development, Jack Lavin, was, and he worked the floor!
As BIO noted in its wrap-up comments about the industry, the biotech industry is poised to reach $100 billion in annual revenue at the end of this decade (actual revenue hit $85 billion in 2007). I believe this number actually underestimates the annual revenue produced by the industry, as this number is rooted in the pharmaceutical portion of the business and doesn’t take into account the agricultural and biofuels portion of the biotech business.
Nevertheless, the pharma part is where we have the best numbers to track the industry progress. Med Ad News recently reported the results of the top 100 biotech companies (again drug-based) for 2007. While there is not room to show all of this, let’s take a look at least at the top 25 companies.
Leading Biotech Companies 2007 – By Revenue and Income
| Company/Country | 2007 Revenue (billions) | % Growth | 2007 Income (billions) | % Growth |
| 1. Amgen (U.S.) | $14.8 | +4% | $3.2 | +7% |
| 2. Genentech (U.S.) | $11.7 | +26% | $2.8 | +31% |
| 3. UCB (Belgium) | $5.0 | +42% | $.2 | (56%) |
| 4. Gilead Sciences (U.S.) | $4.2 | +40% | $1.6 | >999% |
| 5. Genzyme (U.S.) | $3.8 | +20% | $.5 | >999% |
| 6. Biogen Idec (U.S.) | $3.2 | +18% | $.6 | +193% |
| 7. CSL ( Australia) | $2.8 | +14% | $.5 | +359% |
| 8. Cephalon (U.S.) | $1.8 | +1% | ($.2) | (>999%) |
| 9. Celgene (U.S.) | $1.4 | +56% | $.2 | +128% |
| 10.Actelion (Switzerland) | $1.1 | +39% | $.1 | (49%) |
| 11. Amylin Pharmaceuticals (U.S.) | $.8 | +53% | ($.2) | +3% |
| 12. Elan (Ireland) | $.8 | +36% | ($.4) | (65%) |
| 13. ImClone Systems (U.S.) | $.6 | (13%) | >$.1 | (>999%) |
| 14. Millenium Pharmaceuticals (U.S.) | $.5 | +9% | >$.1 | NA |
| 15. OSI Pharmaceuticals (U.S.) | $.3 | +41% | $.1 | >999% |
| 16. Abraxis Bioscience (U.S.) | $.3 | +84% | (>$.1) | NA |
| 17. Cubist Pharmaceuticals (U.S.) | $.3 | +51% | $.1 | >999% |
| 18. Crucell (Netherlands) | $.3 | +55% | ($.1) | 100% 1 |
| 19. Nektar Therapeutics (U.S.) | $.3 | +25% | ($.1) | NA |
| 20. Biocon (India) | $.3 | +10% | $.1 | +25% |
| 21. PDL BioPharma (USA) | $.3 | +4% | – | NA |
| 22. Alkermes (U.S.) | $.2 | +44% | – | +125% |
| 23. United Therapeutics (U.S.) | $.2 | +32% | – | (73%) |
| 24. ViroPharma (U.S.) | $.2 | +28% | $.1 | +42% |
| 25. Vertex Pharmaceuticals (U.S.) | $.2 | (8%) | ($.4) | (100%) 2 |
| Top 25 | $52.5 | +13% | $8.7 | +129% |
Source: Med Ad News, June, 2008
1 Loss was reduced by half. –ed.
2 Loss doubled. –ed.
The top 25 biotech companies represent 62 percent of all biotech (remember there are close to 5,000 biotech companies around the globe) sales and probably over 90 percent of income as most biotech companies lose money.
Nineteen of the top 25 companies are based in the U.S., while six companies hail from Europe to India to Australia. Three of the top 10 companies are from outside the U.S. UCB is listed as a biotech company, although given its history as a chemical company transformed into a traditional pharma company, I would not have classified it as a biotech company. Interestingly, an Indian biotech company, Biocon, makes this year’s list.
Other trends of note include the slowdown of Amgen’s growth in sales and income, and the high growth of Genentech which is catching up to Amgen both in sales and income. Fourth place Gilead has overtaken Genzyme. All of the top 10 companies have annual revenues of at least $1 billion, a good indicator for the progress of the industry.
Monsanto, which, is the top agricultural biotech company with annual sales of $11 billion, and a market cap of about $67 billion is not present in this list, due to the pharmaceutical bent; but it really should be as well as n number of the other AG companies. It would make Monsanto, in essence, the number #3 biotech company and closing in quickly on #2 Genentech.
Interestingly, in the world of Big Pharma, you never really see these types of conferences where countries play a major role at a conference. It is indeed wise that all of these countries have adopted biotech so quickly, as this industry has globalized so quickly and there are so many ramifications on different parts of society: environment, fuels, agriculture and, of course, drugs, diagnostics, and devices. It is, indeed, an industry that can help a country, or city, or region transform itself both economically and physically. In the end it is about economic development.
See you soon!
This article previously appeared in MidwestBusiness.com, and was reprinted with its permission. The article is not meant to be a stock recommendation.
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