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AIDS Treatment News

1995: Business


AIDS TREATMENT NEWS Issue #214, January 6, 1995

Biotechnology investors had a terrible year in 1994. This is bad for people with AIDS, because it makes it hard for companies to raise money to develop new treatments and test them.

BioCentury, a weekly fax newsletter which reports on the business of biotechnology, found that only the largest companies, with market capitalization over $500 million, held their own in stock prices during 1994. The 190 smaller companies which BioCentury follows lost an average of 37 percent in shareholder value; the "infectious diseases and AIDS" group of companies lost 42 percent. This is on top of other losses in 1993.

BioCentury's analysis showed that the actual performance of the industry was not bad in 1994; the success rate for new drugs was about what would be expected in the pharmaceutical industry. The problem, some experts suggested, may have been the great unpredictability of which drugs will work. Some were expected to do well, but instead failed in clinical trials.

Comment In this business climate, advocates for people with AIDS, cancer, and other serious diseases should think carefully before pushing for price-control laws or other mechanisms to hold down the prices of newly-developed pharmaceuticals. The few drugs which do work must pay not only for their own research and development, but also for the many more research and development projects which fail. Otherwise, investors will keep losing money until they stop putting more money in to this high-risk area, and new treatments will not be produced.

The impossibility of predicting which new drugs will actually work in people also reinforces the need for many small, screening trials, to see which potential treatments do seem to be working, and to learn more about them as a basis for further development. The danger, in both corporate and government research, is that too much of the available money and other resources will be diverted to a few large projects, because they have more political influence than small ones.

[Note: For information about BioCentury, call 415/595-5333.]


Copyright © 1995 -AIDS Treatment News, Publisher. All rights reserved to AIDS Treatment News (ATN), Email AIDS Treatment News .

Information in this article was accurate in January 6, 1995. The state of the art may have changed since the publication date. This material is designed to support, not replace, the relationship that exists between you and your doctor. Always discuss treatment options with a doctor who specializes in treating HIV.