Bioinformatics Opportunities: Business models, trends and future challenges

Digital Vector
November 1, 2004
274 Pages - SKU: DG1070452
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Bioinformatics Opportunities: Business models, trends and future challenges

 
With vast amounts of information being generated due to advancements in biotechnology, there arises a need to effectively control and manage the information so generated. Information Technology provides a mechanism more popularly known as bioinformatics, which facilitates this process. Information technology (IT) has become a critical factor in pharmaceutical research and development (R&D). Bioinformatics is the computerassisted data management discipline that helps us gather, analyze, and represent information in order to educate ourselves, understand life’s processes in the healthy and disease states, and find new or better drugs. This field has exploded out of the world of molecular biology and the Human Genome Project. Pharmaceutical companies are achieving increased research efficiency by the introduction of new approaches to the design, synthesis, screening and optimization of drug candidates. IT is an important support function for all of those activities and there are certain functions and operations that cannot be performed without IT. Informatics represents the deployment of Information Technology to manage, analyze, and store biological data. Beyond data management, informatics represents the only way to analyze large pools of genomic information. Informatics finds application in Target Validation, Lead Optimization, Exploratory development etc.

Bioinformatics plays a key role in functionalities such as gather, store, classify, analyze, and distribute biological information derived from sequencing and functional analysis projects. In Bioinformatics, the real long-term value lies in converting the data into useful therapeutics and hence efforts are on to make the bioinformatics tools as standardized and easy as possible, which is similar to the development of standardized computer operating systems. Most publicly held informatics companies had initial public offerings in the second half of 2000. Since then, the biotechnology index hassuffered a major setback, and informatics stocks have reacted in sympathy mostly to the downside. Growth in the informatics industry is largely contingent on continued spending on drug discovery. The market for Bioinformatics isn’t large enough to support a company built around one or two high-cost software programs targeted to a relatively small user group. As we assess the market or potential market of Bioinformatics we must consider the strategies effective to reach different, or all, parts of the potential market. Strategies focused at the high margin big Pharma market (limited in opportunities) or strategies designed to embrace all biological scientist (but of reduced or variable margin). Also, certain bioinformatics-based companies are leveraging their technologies to become fully integrated drug discovery operations. Other bioinformatics companies are merging with drug discovery companies, resulting in a substitute technological approach to drug development.

The convergence of biotechnology and computing has already resulted in a number of alliances, which could result in mergers between previously distinct industries. In future, we may see a combination of pharmaceutical and computing firms bringing together their research as well as IT capabilities. In future we may see alliances between pharmaceutical, software as well as firms, which have strong marketing capabilities. The field would also witness the entry of new players such as computing and telecommunication firms. The challenge facing bioinformatics researchers is simply making sense of the plethora of genomic data while constantly refining their technology, research approaches. The real opportunities are in finding out how all the shards of information relate to one another, and what this means for real world applications.

Recognizing bioinformatics as central to accelerating drug discovery, big pharma and biotech firms are expected to invest heavily in internal capabilities, or meet their needs through outsourcing. As the market matures, collaborative industry initiatives may drive even more bioinformatics demand. Innovation will depend on the integration of databases across functions and across companies.



 

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