Exploring larger biotech research firm strategies: Projections from a comparison of small and larger firms

This is an exploratory study of larger biotech firms using insights from a head-to-head comparison of 49 small and 17 large U.S. biotech firms using archival data. We found small and large biotech firms to be significantly different from each other on R&D intensity and funding strategies. The findings are used to project and hypothesize about larger biotech firm growth strategies.Whereas R&D expenses in the small firms exceed total income by a wide margin, larger firms are able to cover most, if not all, of their R&D expenses. Thus, the larger firms are relatively more financially viable. Results also show that the larger firms derive a greater proportion of their revenues from collaborative research agreements (CRAs), which has key implications for revenue growth in these firms.Based on the findings we project R&D expenses and collaborative research revenues for biotech firms as they grow in size.