Bioscienze ed economia

1. Convegno Science Generation Bioscienze ed economia Vittorio Chiesa Università degli studi di Milano-Bicocca FAST Milano, 14 marzo 2003

2. Index • The healthcare context • The role of biotech • A worldwide overview on biotech industry • The Italian situation

3. Index • The healthcare context • The role of biotech • A worldwide overview on biotech industry • The Italian situation

4. The healthcare context • Increasing level of competition • Patent expiration • Industry performance indicators decline

5. Increasing level of competition Inderall®1965 Tagamet®1977 Capoten® 1980 Seldane ®1985 AZT® 1987 Mevacor® 1987 Prozac® 1988 Dillucan® 1990 Recombinate® 1992 Invirase® 1995 Celebrex® 1999 Lopresor® 1975 Zantac®1983 Vasotec® 1985 Hismanial®1989 Videx® 1991 Pravachol® 1991 Zoloft® 1992 Sporanox® 1992 Kogenale® 1993 Norvi® 1996 Vioxx® 1999

6. Patent expiration • Generic products strongly penetrate • (50% of prescription drugs in US) • Revenues decrease by75% in three months since outpatenting • 40 bln $ of revenues will disappear in the next 5 years Number of expiring patents 2001 53 2002 41 2003 58 2004 46

7. Performance indicators decline Although R&D expenses grow continuously 1992 1997 2001 11 bln$ 18 bln$ 35 bln$ • New drug approval decreases • Post-marketing product withdrawals grow • Sales growth declines (9% in the ‘90ies vs. 5.3% foreseen in the first decade of the 2000)

8. The traditional paradigm is over • Development of blockbusters (at least 1bln$ of revenues) • General-purpose products • Aggressive marketing

9. A new paradigm is required:targeted treatments • Disease-centric approach to drug discovery • Cover of secondary care • Combination of products and services (self-diagnosis, patient training and education, disease management) • Targeted marketing

10. The new paradigm means stronger market pressure • Earlier contacts with regulatory authorities • Continuous evaluation and stringent reviews • Shifting balance of power (to MCO) • Pricing fixed on the basis of medical results

11. The new paradigm is challenging • Higher costs of development (clinical trials) • Lower selling volumes per drug • Lower price but • Higher number of new and more effective drugs

12. Index • The healthcare context • The role of biotech • A worldwide overview on biotech industry • The Italian situation

13. Drug Development Drug Discovery Production & Commercialization The new paradigm meansa new approach to R&D R&D Approval Understanding the disease at molecular level in drug discovery Modeling and simulation in drug development

14. The new paradigm means a great opportunity for biotech companies Drug Development Drug Discovery Production & Commercialization Small Biotech Big Biotech Big Pharma Midsize Pharma Approval Enabling technology providers

15. Index • The healthcare context • The role of biotech • A worldwide overview on biotech industry • The Italian situation

16. The biotech industry in US and EU Data 2001 in millions $

17. Biotech in Europe Number of Companies

18. Biotech clusters in Europe

19. What is a cluster • A cluster is “a geographical concentration of actors in vertical and horizontal relationships, showing a clear tendency of co-operating and of sharing their competences, all involved in a localized infrastructure of support” • In a cluster co-exist small biotech firms, R&D labs of large firms, universities and research centres, financial institutions, service companies, public support structures

20. Advantages from clustering • Sharing of knowledge, competencies and practices • Availability of skills • Collaboration • Support infrastructure

21. Growth mechanisms of a cluster Generation of Start-ups and Spin-offs Excellent Scientific Base Establishment of large firm sites Reinforcement of relations between Industry and Science Growth of the scientific base The trigger is facilitating the generation of new science-based companies

22. How clusters were born • In US and UK, there were the conditions for the growth of a cluster: • excellent scientific base • strong enterpreneurial culture • propensity of finance to risky investments • In other countries (Germany, France, Scandinavian area) the public support helped create the conditions for the growth of a cluster

23. Index • The healthcare context • The role of biotech • A worldwide overview on biotech industry • The Italian situation

24. Biotech industry in Italy and Lombardy

25. What is missing for a biotech cluster in Lombardy Generation of Start-ups and Spin-offs Biodevelopment Companies Scientific Base • Mission • of a Biodevelopment Company • supporting researchers willing to • found a new company • supporting the management of the • project • attracting funds • hosting the companies in their • embryonic phase • International cases • BiomAG in Munich • Genopole in Evry (France) • Scientific and Technology Park in Heidelberg • Innovation Agencies and University Liaison Offices in Scandinavian countries

26. What we are doing • A EU funded project (Cleverbio) to study growth mechanisms and practices of biotech clusters and make a feasibility study for a biodevelopment company • A project funded by Fondazione Cariplo to build a network of bioincubators (University of Milano-Bicocca, Parco Tecnologico Padano, European Institute for Oncology - IFOM)