Genetic Pharmaceuticals pose" a well-understood threat to branded drugs, but the impact of generic competition on the biotechnology industry has been less clear. The recent decision by the Food and Drug Administration (FDA, Rockville, MD)--one relatedto the General Agreement on Tariffs and Trade--to extend patent lives on branded products from 17 to 20 years was welcome news to the bio'tech industry, delaying this unfamiliar and unwelcome threat for more than a biotechnological lifetime, that is, more than the lifetime of the average biotech balance sheet. But the entry of new competitors in the human growth hormone market should remind pra-dent biotech managers that the generic threat is definable and very real and that the time-based nature of competition in the biotechnology industry confirms the need for disciplined clinical development and strong partners. Biotech companies should take the lead from their pharmaceutical cousins in hedging product-development risk by painstakingly planning for the failure of some clinical dials to avoid the irretrievable loss of precious time or the failure of an entire product program.
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