Worldwide wellness industry to boom

Washington DC: The health and wellness industry around the word and especially in the American and European markets is set to explode. Thanks to the convergence of diagnostics and theraupetics, personalized medicare will become a reality this year, said Steven Burrill, CEO of Burrill & Company, a life sciences investment banker.

Diagnostics and theraupetics are being bundled as integrated offers into what are termed as 'Theranostics.' With the convergence and pricing pressure medicare is expected to become more affordable and favorable. The upside in the wellness industry is expected to spike up activity in the neutraceuticals industry that deals with dietary supplements, protein supplements and special medicated foods. The $150 billion industry is going through massive re-organization and is expected to be a major industry in biotechnology, according to Burrill.

Striking a positive note, Burrill called the year 2003 'a great year for the biotech industry.' With close to $20 billion expected to be raised out of 15 to 20 IPO deal this year, VCs making a come back and the new Theranostics taking a lead, Burrill saw much hope for the industry.

Asia is expected to see a spurt in start-ups and integration activity with the global biotech industry. China is expected to lead this Asian emergence. The bells are tolling for big pharma companies, which are scurrying to derive any value left our of the patented drugs. With the patent regime coming to an end, these companies are looking towards innovation as the key to derive value of off-patented drugs. The lifeline here is expected to be the biotech firms. Burrill termed the big pharma’s condition as 'desperate.'

'Biotech is emerging as the R&D engine of the pharma companies,' Burrill said. According to a study by Burrill & Company, the number of biotech-pharma R&D collaborations have gone up dramatically from 69 in 1993 to 411 in 2002. This trend is only expected to go northwards.

'Agricultural biotechnology is caught in a lull and a major re-organization is happening,' Burril said. 'But this year one can expect the issues of GMOs to pass over.' Industrial biotechnology is where the new innovations are happening. With people like Craig Venter taking the genome technology into that sector, the white biotech (as it is known in the Europe) is expected to become more exciting to invent in. A significant development to watch here would be the convergence of micro-organism, plat and animal genome. Talking about the life science instrumentation, Burrill said the sector has come about goods days since its reach has expanded from pharma to the biotechnology sector.

Burril was quick to caution people from terming this as a total resurgence of the industry and expecting the markets to do a bull run. He said the ImClone (which lost $ 4 billion in value in a matter of months on the Wall Street) has changed the story of biotech firms tapping finance from the markets forever. Investors now want to wait for the regulatory and product risks to pass over before pumping money.

Saying the secondary capital market will open its door for a very short while, he urged those who are expecting to raise money to get in the queue 'now.'

In the final reckoning, the outlook for the biotech industry is simple and straight: hitch to the wellness market and pharma R&D band-wagon, raise money fast and work hard.