Dreaming of Silicon Valley: state and future of the biotech revolution
Akin to the rise of Silicon Valley 50 years ago, the biotech revolution is furiously accelerating, with pharmaceutical and science-based start-ups booming across the globe. As young scientists, we might just be the best-equipped cohort to bring our knowledge and ideas to the front line.
This article was written in collaboration with JongEun Ihm.
In 2003, a young Stanford drop-out named Elizabeth Holmes wanted to create an at-home blood testing device that could perform hundreds of laboratory-grade tests with just a drop of blood from a fingertip. Her idea was something that even senior scientists in the field were hesitant to try, but she went against their advice and started its development without any scientific background or formal research training. She ended up fabricating her data and disregarded concerns from her team. In the end, Holmes failed to create the device and, despite stalling for time by lying to her investors, she was eventually sentenced for fraud.
Holmes’ story teaches us that, though a strong scientific background is not essential for the conception of a biotech startup, it is important for its success. If we look at currently successful biotech companies, most are built from substantiated research conducted by well-trained scientists. These companies also value teamwork and integrity; qualities that are integral to scientific training.
Technology transfer from research to industry can potentially deliver the most direct, profound impacts. However, not many young scientists have explored the area of entrepreneurship, though most are well-equipped to do so. So why is this the case? How can we develop the entrepreneurial spirit in young scientists to bring our research into everyday life? What are the risks that we must know before starting? What does the future of biotechnology look like?
The benefit of academic entrepreneurship training
Though the industry of biotechnology has been healthy financially, the lack of young scientific talent has made the system more anaemic than it should be. This is largely because many young scientists do not know how to translate their academic careers into the industry. According to a survey conducted of 300 doctoral students and postdoctorates by Nature Biotechnology in 2020, almost 80% of the career advice that young scientists received from their mentors or institutions pertains strictly to academia. More than 35% of the students said that they were “unaware of their options” or thought there was a “lack of support” (1). Though most young scientists are encouraged to pursue academia, few succeed–less than 1% of all doctorate holders become professors (2).
The pace of career transition from academia to industry also varies by country. While entrepreneurship has become more common for early career scientists in the United States, a study on UK and German scientists’ engagement with industry shows that technology transfer in Europe is still lagging in terms of young talent. Scientists that interact with industry in the UK or Germany tend to be more senior, more reputable, predominantly male, and have access to more resources and capital (3).
To foster competition and push technology transfer forward, many institutions are starting to embed entrepreneurship training in their curriculum. In France, for example, Univeristé de Paris provides a joint degree in biomedical science and management. Institut Pasteur, a private foundation, recently started their own entrepreneurship training program specifically for early career scientists (4). Encouraging technology transfer to industry in such settings has shown to increase the societal impacts of fundamental research as well as the reputation of the institutions themselves. Young scientists in turn can discover flexible career options that previously seemed unavailable. It’s often a win-win framework for both agents.
Current trends in start-up and biotech
Even with professional training and guidance, founding a start-up is much easier said than done. On the surface, all start-ups begin with the same simple question: What does the world need that has yet to exist? Once the answer is solidified, the entrepreneur must then convince investors that the idea is novel, needed, but at the same time technically feasible and financially pragmatic.
Despite the straightforward idea, start-ups fail very frequently. It is estimated that 90% of start-ups fail due to “a lack of consumer interest in the product or service” or “funding or cash problems”(5)(6). These problems are even more magnified in the biotech industry. Often, scientists who focus their works on niche topics have difficulties generalising their knowledge to fit the “mainstream” needs, and a “mainstream” need is the most compelling factor to secure funding. In addition, R&D in biotech requires a large amount of starting capital. The researchers need to be paid; resources are often expensive; and scientific experiments result in failures more often than successes. The innate and inevitable trial-and-error nature of scientific research can be very time- and cost-consuming. Consequently, product development in biotech start-ups can be a lot more arduous and riskier compared to pure tech ones.
Nonetheless, successful biotech start-ups do exist. They are revolutionising the field of medicine, reinventing the way we approach healthcare, and rolling in mountains of cash while doing so. Examples include EQRx, a pharmaceutical startup founded in 2019 that has already made more than $20M in profit, and ORNA Therapeutics, which secured more than $100M in its initial round of fundraising.
With the rapid progress of technology and the growing awareness of entrepreneurship in young scientists, investment in digital health and biotech start-ups has been booming. In 2020, total digital health investment reached $14.9B. In 2021, that number almost doubled to $29B with more than 700 finalised deals across the globe. The largest portion of investment funding went into first-stage research and development. The most invested topics of research were in mental health, diabetes, and cardiovascular diseases (7).
Although the hype in new investment has cooled a bit as we entered 2022, valuations of existing biotech start-ups have steadily increased from their previous financing rounds, suggesting that the sector as a whole is still healthy and growing. Though starting-up in biotechnology is highly risky, solid science combined with careful management can reap high rewards.
The future of biotech revolution
The global healthcare industry is trending towards a valuation of more than $10 trillion in 2022, and some trends have now become more obvious. Incorporation of artificial intelligence (AI) into bio- and med-tech frameworks has grown by more than 600% within the last five years and is becoming even stronger (8). Another clear trend is that healthcare and clinical solutions are becoming more personalised and less formal. At-home testing kits, wearable devices, and virtual health monitoring are all topics going mainstream with the decreasing cost of tech gadgets and the increasing power of AI.
The future of biotech needs new blood, young talent, and passion, and there is no better time to join the revolution than now. Although many student scientists might still view themselves as part of the traditional academic system, keep in mind that the entrepreneurial spirit can always be developed for the willing and driven. For those that are interested: it is never too early to start. Job transition from one industry to another often takes 1-1.5 years. Therefore, the ideal time to consider a career change is shortly after the first year of a masters or PhD program (1). At this point, most young scientists have worked long enough to know whether academic research is a good future path for them, and what skills they might need for the paths considered.
The second year of graduate study is thus a perfect time to develop those skills and to engage in networking and social events involved in industry. Interacting with relevant professionals, especially those who have transitioned from academia to biotech, can be immensely helpful in establishing connections and understanding what a future industry could hold. Staying hopeful and passionate is key, but keep in mind that reality might not always turn out as we envisioned. Though jumpstarting entrepreneurship requires a tremendous amount of forward thinking and drive, it is okay to return and reanalyze the situation to make the most sensible decisions.
One of the biggest reasons for Elizabeth Holmes’ downfall was not having proper, rigorous scientific training. Regarding this aspect, young scientists are already experienced enough to venture into biotech entrepreneurship, so you shouldn't feel unqualified to start your own companies. Joining the biotech industry can look intimidating and risky, but with a lot of hard work, the right mindset, some careful judgements, and just a bit of luck, you might just be the next revolutionary.
1. Gehr, S., Garner, C. C., & Kleinhans, K. N. (2020). Translating academic careers into industry healthcare professions. Nature biotechnology, 38(6), 758-763.
2. Royal Society (Great Britain). (2010). The scientific century: securing our future prosperity. Royal Society.
3. Haeussler, C., & Colyvas, J. A. (2011). Breaking the ivory tower: Academic entrepreneurship in the life sciences in UK and Germany. Research policy, 40(1), 41-54.
4. Le Bureau “Startup Awareness”, Institut Pasteur, 2022.
5. Embroker, Review 42, U.S. Bureau of Labor Statistics, Small Business Trends, Skill vs. Luck in Entrepreneurship and Venture Capital, 2022.
6. Griffith, E. (2014). Why startups fail, according to their founders. Fortune Magazine, September, 25.
7. Krasniansky, A., Evans, B., & Zweig, M. (2022). 2021 year-end digital health funding: Seismic shifts beneath the surface. Rockhealth Insights.
8. Byers, K. (2022). 8 Key Healthcare Trends. Exploding Topics.
This article was copy edited by Devon Conti.