Last week another two US biotechnology companies announced problems with their leading products, suggesting that the industry is still plagued by a jinx which has seen company after company announcing that a product or treatment it is developing is not working out as planned.
This development will do nothing to spur investment in an industry which is reportedly facing serious financial difficulties. Ernst & Young's recent report on biotechnology in the USA suggests that half of the companies have sufficient capital to last only a couple of years (Marketletter October 3). This report estimates that a quarter of companies are scheduled to run out of money within a year unless they can secure new finance deals.
Biogen's Hirulog Last week's casualties include Biogen, which has announced that following preliminary analysis of its Phase III trial of Hirulog, a thrombin inhibitor used in angioplasty, it "does not intend to file for regulatory approval at this time." The company added that it would take a $25 million pretax charge in the third quarter to cover expenses relating to the move.
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