Pharmaceutical Industry The pharmaceutical drug discovery and
development industry has grown to become one of the most
profitable in the world. During the last 30 years, the industry
has blossomed, with billions of dollars spent on research in
biochemistry, molecular biology, cell biology, immunology,
genetics, and information technology--and billions of dollars in
profits earned by drug companies. Indeed, in 2003, the
pharmaceutical industry sold some $466 billion in drugs.
But the process that turns this rich research into medicines
that can help patients is a slow and often heartbreaking one. It
now takes an average of 15 years and $800 million to $900
million to nurture a drug from initial discovery through FDA
approval. Despite the billions companies spend every year on
drug development, the FDA approves only a handful of drugs each
year. Each stage of development is fraught with high failure
rates; even when a company has proven efficacy and safety
through a prescribed series of clinical trials, there's still a
25 percent chance its drug application will not be approved by
the FDA. Despite the odds, though, the prize is grand enough for
the few who hit the blockbuster-drug jackpot that an
ever-increasing number of companies is willing to gamble that
their product will be the next to reach $1 billion in annual
sales. Links Of The Day
The industry can be divided into two broad categories:
pharmaceutical companies and biotech companies. Pharmaceutical
companies make medicines from plant- and chemical-based
compounds. Biotechnology companies seek to duplicate or change
the function of a living cell to make it work in a more
predictable or controllable way.
Though formulating medicinal compounds is an ancient practice,
the U.S. pharmaceutical industry as we know it began when
companies developed large-scale manufacturing processes during
the 19th century. Biotechnology, on the other hand, is a
relative newcomer; the first companies formed almost a century
later, in the 1970s, and the first biotech drug brought to
market--human insulin produced in genetically modified
bacteria--was not approved by the FDA until 1983. Born out of
Watson and Crick's 1953 discovery of the structure of DNA and
Cohen and Boyles's 1973 success in transplanting a single piece
of DNA from a toad into a bacterium, biotechnology uses genetic
research to develop products for human diseases and conditions.
Though job opportunities in pharma and biotech largely mirror
each other, there are notable differences between the two.
Because many biotech firms are still developing their initial
products, they are much more focused on research. This means
jobs for nonscientists are scarcer in biotech than in pharma.
Biotech firms tend to expand their marketing and sales forces
when--and if--a viable product nears FDA approval. And it's
become common for small companies to seek alliances with larger
companies that already have the requisite infrastructure in
place for these functions.
Another difference between pharma and biotech is size. In 2002,
the entire biotech industry spent some $20 billion on R&D; in
2003, just the top five Big Pharma companies spent nearly $23
billion on R&D. And the largest pharmaceutical firms employ as
many as 100,000 people, while Amgen, the largest biotech
company, has fewer than 13,000 employees. This means that
pharmaceutical companies tend to be more structured and
hierarchical--more corporate--than biotech firms, which
generally have a more chaotic, egalitarian, and improvisational
work culture.
Biotech and pharma have been performing exceedingly well
relative to other industries in recent years. And while there
are problems lurking in the shadows at some companies, overall
the future looks bright for these industries. Though there is
plenty of public controversy (e.g., the moral and ethical
questions surrounding genomic and the pricing and patent
practices of Big Pharma), demand for drugs is growing, fueled by
an aging population and blossoming international markets.
Regardless of whether you choose to work for Big Pharma or small
biotech, don't get too attached to the status quo. These days,
the business environment can change overnight. One need only
look at recent biotech stock volatility for ample evidence of
that. And as one insider says, "Even in Big Pharma, if there's a
merger or a spin-off, you can easily find yourself without a
job."
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