How to beat old age

or to make money on the desire of others to defeat it

Ilya Popov, member of industry working groups at the Ministry of Finance of the Russian Federation, the Chamber of Commerce and Industry of the Russian Federation and Business Russia
Rusbase

The modern world market of biotechnologies fascinates with the boldness of projects. They look like quotes from science fiction books: cloning, revival, eternal youth. But unlike books, these projects are real and already give the first results.

Ilya Popov, a member of the industry working groups at the Ministry of Finance of the Russian Federation, the Chamber of Commerce and Industry of the Russian Federation and Business Russia, talks about these projects.

People want to be healthy

They want the body and mind to remain active longer, and old age comes later and, preferably, does not turn a person into a pale shadow. Therefore, manufacturers are forced to look for new solutions to defeat viruses, infections and age-related changes.

In the "big pharma" it is becoming less and less realistic to withstand competition, working in the old way. A similar situation bankrupted the Polaroid company in the 2000s: the film gave way to digital photographic technology.

Investors' interest in the biotechnology market is constantly growing. There is no doubt that this is the industry of the future. But it is necessary to look closely at it right now if you want to jump into the car of the departing train.

Artificial intelligence in medicine

To identify potential investment objects, it is necessary to look "beyond the horizon" and guess consumer demand ahead of competitors.

How to do it?

• To look closely at the changes at the intersection of economics and sociology. For example, there are more and more elderly people, so there are more diseases associated with old age that are significant for society. The grocery basket and leisure activities are also changing.
  

• Test ideas in research centers. Large pharmaceutical corporations are investing billions in the development of a machine learning system for supercomputers. Thanks to this, they can predict whether it will be possible to create an effective drug from certain molecules without spending years on research and salaries for a small army of scientists.

In Russia, the Insilico company is using artificial intelligence to develop a technology that can increase the productive period of a person's life.

The "highlight" of biotech

Mathematical modeling and bioinformatics can become powerful drivers of business development and the economy as a whole. Although talented scientists still remain the "highlight" of biotech. Only a person can correctly interpret the accumulated data within the framework of a specific task and give out a unique idea or a revolutionary solution.

When technologies become cheaper and become available to everyone (like 3D printers), it is intellectual property that continues to bring multibillion-dollar profits.

This is what happens with preventive technologies: in the early 2000s, reading the genome cost $3 billion. Now it can be done for $ 1 thousand. There are even bold offers on the market at a price of $100.

What niches are opening up in the Russian biotechnology market now?

Experts see great potential in the field of industrial production of biocompatible materials and products made from them.Today, more than 90% of products are imported from abroad. Meanwhile, the demand is high, and it is not fully satisfied. Only the need for endoprosthetics of large joints is estimated at 300-400 thousand operations per year. In fact, no more than 100 thousand are performed.

The production of antibiotics is also dominated by foreign players. Their share in sales volumes in Russia exceeds 70%. There is a place for potential investors to turn around in Russian production.

The Russian market of laboratory diagnostics, one of the most dynamic among developing countries, is growing rapidly — by 10% annually. According to Frost & Sullivan's forecast, its volume will almost double and exceed $ 1 billion by 2018. Such high rates are due to both growing government spending on equipping laboratories with modern analyzers, and the development of the private sector, which is constantly expanding the range of available services.

A separate trend in the laboratory diagnostics sector is the development of biosensors and biochips. These are electronic devices of a new type that contain certain biological objects, starting with enzymes and ending with cell cultures or tissues. They are most widely used in glucose meters — devices used by diabetics to measure blood sugar levels.

"Thresholds" for the development of industry in Russia

With all the undoubted prospects of the biotechnology market, the main stop factor remains the difficulty of launching new products. Due to the length of the cycle, from the development and R&D stage to the launch, sometimes this process takes more than 10 years. Another significant constraint: the "separation" of the scientific and educational sphere from the real sector of the economy. The lack of demand for innovative developments from the real sector of the economy hinders the commercialization of R&D in Russia.

Mergers and acquisitions in the global market

The global biotechnology market is expecting a new round of development. Mainly because of the distribution of forces between the major players. A wave of mergers and acquisitions is expected, due to political trends and, oddly enough, lack of ideas.

Due to the influx of "new blood" from startups and small companies, in 2017, it is possible to update the portfolio of Johns Hopson ($42 billion); Amgen ($38 billion); Gilead ($32 billion); Allergan ($27 billion); Merck ($25 billion); Pfizer ($24 billion); and Novartis ($23 billion).

Many large pharmaceutical companies do not buy developments at early stages. They need a profit, and they aim to buy companies with already approved products.

Cases

1. In 2017, Acadia, which has developed and received approval for the drug Nuplazid (a drug for the treatment of patients with Parkinson's disease), is awaiting takeover. The same fate awaits Incyte — it is attractive to investors with a combination of a strong scientific base and high profit growth rates. Its main product, Jakafi, is used to treat rare forms of cancer.

2. BioMarin is an interesting company, which has five approved medicines, and annual sales of which exceed $ 1 billion, which makes it another desirable object to buy. BioMarin's portfolio includes the drug Brineura for the treatment of Batten's disease, pegvaliase for the treatment of phenylketonuria, BMN 270 — gene therapy for the treatment of hemophilia, as well as medicines for the treatment of a rare disease called "Sanfilippo disease".

3. Tesaro has a medicine called rolapitant, which is used to treat nausea during chemotherapy. In addition, they have another drug for the treatment of cancer almost in the final stage of development. It can become very popular after entering the market. Large companies are interested in expanding their portfolio through such developments, and are likely to buy Tesaro this year.

Conclusion

Medical biotechnologies using IT solutions fundamentally change the approach to the development of medicines and increase the chances of defeating or even preventing intractable diseases. Hence the interest in them from the states and large investors.

The redistribution of industry shares in the economy is moving towards future technologies. Competent investments in this area can pay off a considerable hundredfold.

The article uses the published results of the company's research Frost & Sullivan, in cooperation with the Innovation and Investment Market of the Moscow Stock Exchange and the Russian Venture Company (JSC "RVC").

Portal "Eternal youth" http://vechnayamolodost.ru  01.09.2017