Image: Genesis 2018 conference big screen. Credit: Biotechgate.
I recently attended One Nucleus’ Genesis 2018 conference in London, one of the UK’s leading annual gatherings of people working in life sciences and healthcare.
I went along with members of our Enterprise Unit, who have helped to make The Institute of Cancer Research the leading higher education institution in the UK at generating impact and earning invention income from research.
The team manages and negotiates hundreds of agreements with industry each year, overseeing a list of around 200 current partners.
Genesis, or #ongc18, brought together professionals from across the life sciences and healthcare sectors, from academic researchers to biotech, medtech and big pharma executives, and the business development professionals who support them.
It was particularly interesting to hear the views of those attending from the world of finance who fund much of the later-stage work in the sector after academics, like those at The Institute of Cancer Research, have made their discoveries.
Once a discovery is made in the university sector, where most research is funded by government and charities, it takes substantial financial investment to bring it to the wider market.
I heard from representatives of pharma companies, venture capitalists, lawyers, and even people who manage the investment of private wealth for international clients.
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Here is my take on what seem to be some of the big challenges for the sector for 2019:
Everyone at Genesis seemed to agree that we are seeing an unprecedented convergence of the health, biosciences and tech sectors. Big names like Apple, Amazon and Google are making moves into the healthcare space and making the industry re-think about how it operates.
From a funder’s point of view, there are opportunities in the pipeline to invest in start-ups and smaller companies that combine healthcare and tech.
The world of high finance needs to adapt its own existing structures too, which traditionally see healthcare and technology as separate investment areas.
There is also a trend for convergence within the scientific community – for example in combining the work of biological and computational scientists, or materials scientists.
In biosciences overall, skills in team building and networking are increasingly important.
2. Biotech is a risky investment
For investors, biotech is a relatively challenging proposition. A start-up company will often need tens of millions of dollars before it reaches the point where it has any marketable assets, or can attract the attention of a larger company as a possible acquisition target.
Biotechs can generate significant return on investment in the longer term, but many will fail.
Over the past ten years, wealth managers have increasingly moved into biosciences thanks to the development of new financial products that include investment in biosciences companies, and balance their clients’ desire for return on investment with their views on risk. But biotech still needs to work relatively hard to attract investment.
3. Planning to secure intellectual property
Partly because of this perception of risk, many large investors want to see intellectual property, usually in the form of patents, secured before a conversation can even begin with an inventor.
Some investors want those who generate innovative new ideas – in particular in academia – to be thinking early in their research about how their work could lead to a patentable product or technology. Some will not consider stepping in to fund the next stage of research unless there are patents in place.
Patents are generally secured in drug discovery, a key part of the ICR’s work, which helps to explain why cancer drugs are continuing to be a major driver of growth in the pharma sector.
However, some tech inventions – particularly apps – are never patented at all. And often it will not pay for an inventor to secure a patent too early, as once a patent is filed a clock starts ticking. If profits from their discovery only come years down the line, inventors lose out from patenting too early.
So a key challenge for 2019 is for inventors, including in academia, to work out how the multi-faceted, multi-disciplinary inventions of the near future could be managed in terms of intellectual property.
4. Letting go
Investors can perceive academics as challenging to work with, I learned at Genesis.
It seems to them, that even when an invention does attract the interest of investors who can mobilise the resources to develop into something that could change the world, academics can struggle to hand their work on to those who can take their work to the next stage, such as experienced CEOs.
This could get harder, rather than easier, as scientists converge into bigger, multi-disciplinary teams.
University technology tech transfer offices – like our Enterprise Unit at the ICR – can help here in forming the vital bridge between academics and investors or industry, and finding the right compromise.
5. Remaining internationally competitive
The UK biotech sector competes with the very best in the world, partly because of the very high quality of our academic research.
I did hear about some of the challenges that might be on the way because of Brexit – with UK researchers locked out of some sources of EU accelerator funding, for example – and some of the other barriers that international investors perceive when it comes to choosing to invest in UK research rather than the US or elsewhere.
But the perception of how UK universities are seen from abroad was clear. “The cure to every disease is on the shelves of British universities,” one speaker said.
And the London Stock Exchange (LSE) was even on hand to explain the benefits of listing biosciences companies in London rather than New York or Zurich, including the vibrant alternative investment market (AIM), LSE’s listing of smaller companies.
It is obviously an exciting time to be involved in life sciences. In 2019, the biggest chance of success for academics, industry and funders seems to lie in innovation, co-operation, and understanding each other’s perspectives.
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