Vanishing Civilizations: Where Next for Life Sciences Companies?
Posted on Mon, Feb 28, 2011 @ 01:45 PM
The recent acquisition of Genzyme by Sanofi Aventis continues the now familiar story of Big Pharma in our time. I'm sure it's just a matter of time until the layoffs are announced, financials are reported and analysts begin to question the wisdom of this most recent acquisition.
As readers of this blog should know by now, we don't believe that the continuous trend of Big Pharma companies growing by acquiring, absorbing and erasing smaller, more agile and more innovative life sciences companies is healthy for the life sciences industry overall.
Here at the offices of JFK Communications, the recent Sanofi Aventis/Genzyme announcement got us thinking about lost civilizations of the pharmaceutical kind. So we've started a list of once great life sciences companies that, as a result of M&A and consolidation, no longer exist.
Here goes:
- Genzyme
- Pharmacia
- Wyeth
- Parke-Davis
- Warner Lambert
- Lederle
- Marion Merrell Dow
- Ciba Geigy
- Hoechst AG
- Knoll Pharmaceuticals
- Schering Plough
I'm sure this is only a partial list, and that I'm missing quite a few others. The point is, here's a big list of companies that, while they were operating, employed thousands of people, delivered innovative treatments that saved lives, generated billions of dollars in revenues and made major contributions to the economies of countries throughout the world.
I believe that innovation always has and always will drive the growth of the life sciences industry. And if the past ten years in our industry teaches us anything, it's that the mid-tier and smaller life sciences companies have proven to be the sweet spot for innovative new products and technologies.
I think Big Pharma does a wonderful job of partnering with innovator companies, and these partnerships can be a "win/win" for both parties. Big Pharma wins by gaining access and marketing rights to innovative new products, which they desperately need to fill their shrinking pipelines. Innovator companies win by getting access to significant revenue, which they can use to finance ongoing operations, hire more talent, and continue R&D to develop more product candidates. And best of all, the broader ecosystem of life sciences companies remains balanced, with a mix of Big Pharma players seeking new products emerging from clinical research, and smaller innovator companies providing greater flexibility and R&D efficiency to identify and help commercialize these new products.
Big Pharma's addiction to acquiring, absorbing, and laying off hundreds of employees from innovator companies hasn't helped the economy, it hasn't increased shareholder value, and it hasn't delivered more products to the patients who need them.
There has to be a better way.