For three years running, Australia has ranked in the top 5 in biotechnology in the world with 140 ASX- listed biotechnology companies with a market capitalisation of $50 billion (Ausbiotech, 2017). CSL remains the largest biotechnology company in Australia with Medical Technology and devices also surging forward. The big guns in this area include Cochlear and Respiri with their ear apparatus and breathing tracking devices. Biotechnology and Medical Devices certainly remain promising areas for commercialisation. But what are the critical factors for their success? Every company starts small, but with proper leadership to direct company management and translation of Research & Development into commercial products, your company can grow.
Amgen was a struggling company in the 1980s suffering in an era where biotechnology was a relatively unknown industry. Here are five critical success factors that contributed to Amgen’s success in translating drug development on a small scale to the mass market.
- Early Financing: M. Bowes was the founding shareholder of Amgen, hiring Winston Salsa, a UCLA scientist, to collaborate with him. Together they recruited a formidable scientific advisory board and raised $200,000 in venture capital. With this funding, Amgen recruited George Rathmann, the former chief of Abbott Laboratories, who then set out to raise large rounds of private equity funding. Early financing allowed Amgen to retain most of the marketing rights to Epogen and to survive the development and commercialisation process. It also meant that Amgen didn’t have to license away their rights to their best products.
- The Right People: Poor management can destroy a good company. With the right people, both with technical and commercial abilities, Amgen was able to raise the necessary funding to commence operation.
- Focused R&D: Amgen’s CEO insisted that the R&D strategy was to focus on a small number of high-potential projects. The strategic focus combined with effective R&D management allowed the company to successfully commercialise breakthroughs.
- Strategic Partnerships: Not every company or team is perfect. Amgen was able to recognize that it lacked manufacturing expertise. Establishing a joint venture with Kirin Brewery proved invaluable to both companies. Amgen was able to gain access to critical manufacturing technology, in exchange for some international marketing rights.
- First Entry: The early bird gets the worm indeed. Amgen invested heavily in marketing and manufacturing during the early days, positioning them as market leaders in an uncontested market for EPO based products.
From a little company in the LA, Amgen became one of the leaders in biotechnology.
At InnerMaven, we can help in the critical early stages to raise early financing and to provide commercial expertise.