IBT Partners has specialised knowledge in the life sciences sector and provides financial, business and technical consultancy services.

The life sciences industry has specific challenges that need appropriate expertise. Our know-how helps you achieve your international business and trade development goals. We offer you sector-specific knowledge, as well as our contacts and opportunities for networking.

Our services and solutions are tailored to the needs of each of our customers, please see Government and Corporate for more detailed information.

Read more about the life sciences sector:

• Background
• Current challenges
• Opportunities

Life sciences background

Life sciences is a broad sector based on the scientific study of living organisms, comprising numerous subsectors*. The interdependency of individual subsectors is extremely high, making the cooperation and partnering across the sectors necessary for the overall success of sector participants. The Medical and Pharmaceutical sectors remain the most lucrative life sciences businesses, continually seeking new investments. The industry is now able to innovate faster and more effectively by taking advantage of new technologies, facilities, increased knowledge and experience, benefiting from a better support for R&D.

Current challenges in the life sciences sector

Even life sciences have faced various challenges imposed by the economic slowdown. The sector has remained resilient mainly due to its ability to innovate and be flexible. Accessing capital, especially for early-stage companies, was very difficult post-crisis. However, in a global survey carried out by M&C**, 63% of respondents agreed that the conditions for accessing funds have improved in comparison to 2009. Respondents also believe that the improved economic situation will increase the industry’s confidence, leading to new acquisitions and strategic commercial collaborations with partners. The expected acquisitions will also be as a consequence of the inability of pharmaceutical industries to innovate sufficiently. Therefore the main concerns of industry leaders shifted from the economic fears to long-term industry-specific problems¹.

Since this sector has become more competitive, it is necessary to learn how to achieve superior results with scarce resources. Even though the base knowledge of life sciences is broader and deeper than ever before, the success will require greater efficiency and the adoption of more feasible business models. The Medical and Pharmaceutical sectors in particular are chasing new opportunities by improving their R&D. This includes advancements such as restructuring to increase innovation and effectiveness, product diversification, global expansion to new markets, or a shift from traditional mass-markets to targeted niche markets. Moreover, it is necessary to find new ways of gaining capital. This can include any possible source from government programs through disease foundations, corporate partnerships to risk sharing arrangements with service providers. Efficient use of capital and achieving faster paths to desired results will become the new source of competitive advantage.

Opportunities in the life sciences sector

In order to keep pace with developments in the life sciences sector, it is important to have access to actual, accurate and complete information and in-depth expertise. We will help you to address all important issues, including trends, sector's key success factors, advancements and innovations, supply and demand development, operational and financial risks, benchmarking, as well as regulations and opportunities for funds and grants.

Following are some of the key opportunities and trends in the life sciences sector:

• MedTech***

  → With over 40% market share, the US medical device market is the world’s largest. Imports account for 34% as manufacturers outsource to cheaper locations although high-end medical devices retain their US production base. The European medical device industry is estimated at €65.1Bn. Germany, France, the United Kingdom and Italy make up 72% of Europe’s medical equipment supply and demand (2009^)8. Technologies to watch include nanotechnologies, optical technologies, microsystems and microprocessor devices, high resolution imaging, biotechnology, biosensors, and smart artificial organ implants.

• Healthcare

  → Currently, the actual healthcare business produces services worth of $1.6 trillion in the US and $1 trillion in the EU, and is expected to grow globally². One of the most significant growth drivers in the healthcare industry is demographics. The phenomenon of aging populations suggests that the proportion of people over 65 years old in Europe will be double over the next 50 years, making up 30% of the entire population³. As a result, demand for healthcare will increase, because elderly people are the main target group. In addition, epidemics of chronic diseases are increasing (already 1/3 of the UK population lives with a chronic health condition), and the German Advisory Council on Healthcare system estimates that chronically ill patients could account for 75% of healthcare expenditure.

• Biotechnology

  → Biotechnology is a subgroup within the life sciences sector which uses living organisms and their products for the production of food, drink, medicine, and other products that benefit our society. Biotechnology actually started out as farming but has since developed into a more complicated science which, through the exploitation of microorganisms, manages to find the pharmaceutics necessary for curing many diseases. Biotechnology is also increasingly used in the FMCG industry, as people turn away from artificial additives and packaging which can harm the environment, and look for products including natural flavourings and preservatives, biomass plastics, and bio indicators to detect contamination. Biotechnology has also found its place in the chemical industry where plant biochemicals are used to produce chemicals in a "greener" way. Other sectors where biotechnology has made valuable contributions are the environmental technologies and aerospace.⁵
  → Investments in biotechnology have increased since last year in terms of the amount of money invested (a 3% increase) and deals closed (an 8% increase)^6. Recent trends in the biotech industry include an increased number of partnerships and collaborations between biotech companies and university research centres. In the near future, the US biotech market will be shaped by the development of healthcare reform legislation, implementation of pharma tax, and the Sunshine Act which outlines the relationship between biopharma and physicians⁷. In the EU, the biggest issue remains the development of regulation concerning GMOs, and opportunities for biotechnology in food and feed safety.

• M-health

  → Innovations in mobile communications have opened up new ways of delivering healthcare and responding to some of the most persistent global health challenges. This is creating a whole new industry out of the convergence of ICT and healthcare, often referred to as Mobile health or M-health. The M-health business is attracting much interest and investment in research and development, and yet great uncertainty remains about what the structure of the market might ultimately look like. IBT Partners is carrying out an industry-wide survey to look at what executives in the industry consider to be the main barriers to widely forecast growth, and what might be the factors that propel it from being an area of great potential to a profitable and fast growing business.

• Opportunities from the US

  → The US health sector has been shaped by reform legislation aiming to expand access to healthcare whilst reducing costs. Significant efficiencies need to be applied, and even though this situation seems to decrease the level of innovation, the contrary is actually true. Specialists expect that as a result of broader access to healthcare, the increased demand will generate greater margins than it will losses, incurred through cost reductions. As a result, the US will see a more welcoming environment for medicine innovation than Europe. It is also believed that the US intellectual property system has better managed to reward innovation and respond to the changing industry needs than Europe. Moreover, there are concerns over numerous regulatory policies in the sector imposed by the European Commission and the European Patent Office¹.

• New markets

  → Other world markets expect to witness great transformation within the life sciences industry. Innovators have left the US to find clinical data, acquire new-product registration and generate new revenues in Europe and beyond. The long term focus of the sector is centred on the emerging economies. The nature of innovation changes as the developing countries become the leaders in markets for smaller, faster and more affordable devices at lower costs. India in particular, has an enormous potential both as a producer and a consumer. Their biggest opportunity is a sophisticated pharmaceutical industry. It is estimated that by 2020, India will become one of the top 10 sales markets. This will mean greater competition, but also more partnering opportunities. Even demand in India will be increasing. India’s population is aging and expanding, as well as its economy, creating a bigger middle class that is able to buy medicines to cover their needs⁴.

*Life sciences comprise of Bio-engineering, Biomedical science, Biochemistry, Biocomputing, Biology, Biomechanics, Biomolecular engineering, Biophysics, Biotechnology, Ecology, Environmental science, Food science, Genetics, Health sciences, Immunology, Medical devices, Medicine, Molecular biology, Nanotechnology, Pharmacology, Physiology, Plant sciences, Zoology and many other disciplines
** The survey was carried out in 2010 with representation of the US, European and Asian respondents. Respondents included 380 representatives of various life sciences sectors including biotechnology companies and organisations, pharmaceutical organisations, venture capitalists, financial institutions and other industries with biotech interest.
***MedTech stands for medical technology, an expanding sector that includes wide range of products used in the healthcare sector.

1) Marks&Clerk. 2010. Life Sciences Report 2010.

2) Capitol Health. 2010. Online at: http://www.capitalhealth.org

3) Eurostat. 2010

4) PwC. 2010. Healthcare. Online at http://www.pwc.com/gx/en/healthcare/index.jhtml

5) Martino, M. et al. 2011. Top 15 Biotech venture capital deals of 2010. Online at: http://www.fiercebiotech.com/special-reports/top-15-biotech-venture-capital-deals-2010

6) Coles; N.A., 2010. Top 5 Biotech surprises & innovations of 2010 and 5 trends to watch in 2011. Online at: http://www.xconomy.com/san-francisco/2010/12/30/top-five-biotech-surprises-innovations-of-2010-and-five-trends-to-watch-for-in-2011/

7) Phillips, T., 2011. What is biotechnology? Online at: http://biotech.about.com/od/whatisbiotechnology/a/whatisbiotech.htm

8) ESPICOM, 2009. Online at: http://www.espicom.com 

Contact us

If you would like to know more about our life sciences sector expertise, please contact us at
lifesci@ibtpartners.com
for additional information.