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Health Biotechnology: Emerging Business Models and Institutional Drivers

Introduction

This report of the OECD deals with the future advances of biotechnologies in the field of health, not only for the “Big Pharma” but also for the biotech companies and governments. The public policies are challenged by new strategies, linked to the developments of existent products of biotechnology, which are increasingly based on public-private partnerships. It is essential to analyze the interface between the public and the private in future public policies. These ones have to stimulate at the same time: growth, competitiveness of firms in the international development in order to apply these new technologies to solve matters of public health.

I/ Health biotechnologies: Two dominant business models…

Until today, two businesses models have been usually used in the application of biotechnologies for human health:

- The classical model of biotechnology: the scientific and technological discoveries were fast developed within little companies of biotechnologies, often based on venture capital. These ones are still sold to big pharmaceutical companies because those little companies are very competitive and flexible relating to a quick time of launching new products on the market.

- The other dominant business model is that of the large, vertically integrated company. These large firms have integrated everything inside the boundaries of the firm, from research and development (R&D) to production to marketing and after sales monitoring. The ones in pharmaceuticals have competed through finding the next ‘blockbuster drug’ and the ones in medical devices have also competed through developing specific technologies and devices for large numbers of customers.

II/…challenged to external developments based on an arising institutional context.

These two dominant models are being challenged, due to serious problems of profitability,