Surfaxin: Epitomizing Esteve
The progress of Esteve's lead compound Surfaxin illustrates how the Spanish group is building a robust, yet risk-controlled pipeline to supplement its co-marketing activities. The compound may also become the first marketed drug in which Esteve played an active development role, and bears testament to the private group's partnering appeal.
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Big Pharmas are beginning to shy away from expensive licensing deals, at least until they begin to see returns on their existing blockbuster agreements. This reluctance is opening the door for mid-sized firms-particularly Europeans-to transform themselves through increased and more creative dealmaking. Moreover, the transition by traditionally in-licensing based firms like Spain's Esteve to out-licensers will accelerate the prominence of Europe's mid-sized players.
Changing global dynamics, and increasing price pressures in Spain, are compelling private Esteve to change its strategy and its structure. The company feels a need to be bolder and more efficient than before. The firm continues leveraging its traditional strength, helping Big Pharmas market. But lately it has also allied with US biotechs, paying more for exclusive rights to novel products. It's risky, though: two drug candidates it hoped to get failed recently. Now, making research pay off is a top priority for Esteve, which views itself as having a research-oriented culture, although its only successful drug was launched 20 years ago. The company's new strategy heightens risks and difficulties, but the owners feel they have little choice in the increasingly cost-controlled Spanish market. As a private company, Esteve can afford to place the bet and strive for success.
Deals show large investors’ appetite for early-stage biotech, but can VC and PE rub along?