Is it possible for biotech startups to outshine giants like Eli Lilly and Novo Nordisk?
Between 2021 and 2023, the landscape of the pharmaceutical industry saw a stark contrast. While American big pharma experienced a significant rise, fueled by the success of blockbuster drugs, smaller biotechnology companies faced challenges. Hindered by increasing interest rates and the fading excitement surrounding medical advancements post-pandemic, these startups struggled to secure investments. In the previous year, they only managed to attract $17bn, a sharp decline from $37bn two years prior. With fewer companies going public and more facing financial difficulties, the biotech sector seemed to be in a tough spot.
Despite this, the giants in the industry continue to thrive. Eli Lilly, known for its popular weight-loss treatment, reported strong quarterly results on April 30th. Similarly, on May 2nd, Novo Nordisk, a Danish competitor with its own anti-obesity drug, is expected to follow suit. The combined value of these two companies has soared to $1.2trn, a significant increase from $350bn just three years ago. However, there is also positive news emerging from the biotech sector, indicating a potential turnaround that could benefit investors, patients, and the pharmaceutical industry at large.
2024-04-30 16:28:33
Original post available at www.economist.com