Biotechnological business involves the use of living organisms for commercial use. The principal field of Biotechnology is medicine, and the related products like vaccines. Biotechnology is utilized in heavy industry, agriculture and mining with products such as biopesticides. A lot of large pharmaceutical companies have separate divisions for biotech-based medical treatments. Certain of these drugs originate from living organisms while others have a chemical base. This distinction is crucial since both industries have distinct risk profile.

In addition to the risks, a biotech company’s extensive research and development activities can cost a lot to operate. A successful this post drug can yield a significant financial gain. However, it can take a long time for a new product reach the market. The FDA approval process can be long and complicated. It requires preclinical testing as well as clinical trials and quality control. According to Science Daily only a small percent of the compounds tested will are approved for commercial use.

Biotech companies can choose to focus on technology partnerships or create their own pharmaceutical assets which they lease to big pharma for manufacture and marketing. Many biotech companies are taking the latter route because it will boost revenue growth. However, it is not without risk as they also have to cover the costs of clinical development, regulatory approval, insurance reimbursement negotiations and sales promotion. Many biotechs make strategic alliances to minimize these risks. These include partnerships with major pharmaceutical companies and smaller biotechnology platforms. The biotech ecosystem in Massachusetts, for example comprises top teaching hospitals, universities, entrepreneur communities and venture capitalists.