The biotech industry uses biological systems for the development of its products. This process may include living organisms. It is a sector that is primarily dominated by biopharmaceutical drugs, but it can also include food products, chemicals, and miscellaneous goods.
Over 700 public companies represent the biotech industry in Europe and the United States, generating revenues of more than $140 billion annually. The U.S. dominates this market, with $112 billion in revenues annually. You’ll find the highest concentration of facilities active in this sector in the San Francisco area. The total market capitalization in this space is over $700 billion.
When looking at the biotech industry from an agricultural lens, 76% of the corn that gets planted in fields each year has been genetically modified in some way. The two most common reasons for this activity are to have the plant produce more fruit or to make it more resistant to pests.
Interesting Biotech Industry Statistics
#1. It takes an average of 12 years for an experimental drug discovered in a laboratory setting to reach a patient – and that’s assuming it makes it out of the testing phase in the first place. There are two laboratory phases, preclinical testing with animals, FDA approvals, human clinical testing in three phases, and a final review that must occur. (California Biomedical Research Association)
#2. Insurance companies around the world classify about 68,000 different disease states. Although the differences can sometimes be minute, it is one of the primary reasons why the biotech industry has so many potential opportunities. (World Health Organization)
#3. The average cost to develop and drug and achieve marketing approval for it is $2.56 billion. That figure includes $1.4 billion in out-of-pocket costs. That’s why new drugs are so expensive when they reach the market. (Tufts Center)
#4. Almost $60 billion was spent on research and development by PhRMA’s association members in 2016. That figure is more than double the $26 billion spent on R&D in 2000. In 1980, only $2 billion was spent in this area. (The Motley Fool)
#5. Only 1 out of every 1,000 drugs that enter preclinical testing will make its way to a human clinical trial. Just 20% of experimental drugs will move into clinical studies that patients can access. That means the success rate is 0.1%. (The Motley Fool)
#6. Over the last 20 years, the biotech industry has made orphan diseases a top priority in the research and development sector. These are health issues that impact 200,000 patients or fewer in the United States. The FDA averages about 40 new drugs per year in this category today, but it was only 13 per year in the early 2000s. (The Motley Fool)
#7. The most expensive drug in the world today is Soliris, which is about $500,000 per year. Others have come in at higher prices, but they get pulled from pharmacy shelves. (The Motley Fool)
#8. There are currently 246,000 ongoing clinical trials being managed by the American biotech industry. All 50 states have at least one trial under review, and there are also activities in this area in 200 countries. About 56% of the studies are currently being conducted outside of the United States. (ClinicalTrial.gov)
#9. About 854,000 jobs are directly attributed to the development of biopharmaceutical drugs. When indirect jobs are added to that figure, the number rises to 4.4 million. (The Motley Fool)
#10. Generic prescriptions account for about 90% of all the scripts that doctors right each year. In 2000, that figure was only 49%. (PhRMA)
#11. Up to 92% of the corn that reaches the American market could have gone through genetic engineering. 94% of cotton and soybeans have gone through these alterations. Upwards of 75% of the items on supermarket shelves contain at least one genetically engineered ingredient. (Center for Food Safety)
#12. Genetic modifications by the biotech industry have permitted an average increase in crop yields of 22%. This outcome has helped to increase the profits of farmers by 68%, with even higher margins available in the developing world. (Cornell University)
#13. The biotech industry is responsible for increasing the global production of corn by 357 million tons, soybeans by 180 tons, and cotton by 25 tons. Canola, sugar beets, and several other crops have also seen improvements in yield numbers because of the activities of this sector. (Cornell University)
#14. Almost 20 million hectares were prevented from being used for agricultural purposes because of the efforts of the biotech industry. (Cornell University)
#15. GM crops allow for an increase of yield of 6% to 25% depending on the country where the growth occurs. There is an additional benefit of reducing mycotoxin levels by over 30% with these efforts. (Cornell University)
#16. The amount of arable land planted with crops modified by the biotech industry rose from 1.7 million hectares in 1996 to 185 million hectares in 2016. (Cornell University)
#17. About 18 million farmers are using genetically engineered crops in 26 different countries, making this product the fastest item adopted worldwide in recent times. (Cornell University)
#18. The only genetically modified crop designed for yield with commercial approval is a eucalyptus tree from Brazil. It produces 20% more wood and takes 18 fewer months to mature. (Cornell University)
#19. Scientists working on C4 rice would make the photosynthesis process more efficient in the plant, accelerate growth by capturing carbon dioxide to concentrate it. A successful outcome could increase yields by up to 50%. (Cornell University)
#20. Over half of the research that takes place for the biotech industry occurs in the United States. American companies hold over 50% of the IP rights on newly discovered medicines. (SelectUSA)
#21. 17% of the research and development activities that take place in the United States are directly related to the biotech industry. These activities help to generate an economic output of $1.2 trillion annually, which is a little less than 4% of the national GDP. (SelectUSA)
#22. Biologics are responsible for over 30% of the new drugs that are either in clinical trials or awaiting a final-stage approval by the Food and Drug Administration. (SelectUSA)
#23. Vaccines produced by the biotech industry have a total global market value of more than $32 billion. By 2025, this amount could top $60 billion for the first time. (Statista)
#24. Flu vaccines are responsible for about $4 billion in revenues for the industry each year. Only five multinational companies make 80% of the vaccines that people use around the world. (World Health Organization)
#25. Although developing countries make up 80% of the global population, they are responsible for less than 20% of the worldwide market for biotech products. (World Health Organization)
#26. India and China are expected to continue leading in the global biotech industry, responsible for over 10% of the total capacity found worldwide. These two countries currently have a bioreactor volume of 1.8 million liters to support ongoing development opportunities. (Bioprocess Online)
#27. The total size of the American biotechnology market was $112.4 billion in 2019. This figure represents a 3.5% increase in growth for the year, while the 5-year average was an increase of 1.7%. (IBIS World)
#28. Over 191 million hectares of genetically modified crops are grown around the world each year. Although the U.S. is the leading producer of this product, there are over 2.6 million hectares of GM corn and soybeans grown in Ontario and Quebec alone. (Statista)
#29. 34% of Millennials say that foods grown with genetic engineering should never be used for human food products or beverages. 32% of the people in this demographic say that GMOs need more testing. (Statista)
#30. 22% of American consumers say that they have started to drink less coffee each day because of their concerns over genetic engineering by the biotech industry. (Statista)
#31. The most important food safety issue for American consumers is food safety, with 1 in 4 people saying that it is their top priority. 48% still “strongly agree” that any crops growing with GMO technology should be labeled as such. Another 41% say that they “agree” with the labeling idea. (Statista)
#32. 26% of American shoppers say that they make it a top priority to shop for foods that have not been touched by the biotech industry. (Statista)
#33. Out of the 24 countries that planted biotech crops in 2016, 18 of them were considered “mega-countries” because there were 50,000 hectares or more of croplands producing these items. The United States was the top producer with 75 million hectares, covering 40% of all biotech crop plantings. (ISAAA)
#34. Brazil, Argentina, Canada, and India all planted more than 10 million hectares of biotech crops in 2017. When that list expands to 1 million hectares or more, then Paraguay, Pakistan, China, South Africa, Bolivia, and Uruguay make the list. (ISAAA)
#35. Farmers in Canada and the United States planted biotech alfalfa in 2017, representing a total of 1.14 million hectares. Low lignin alfalfa was first commercialized in 2016, and it offers an increase of up to 20% in the possible yield. (ISAAA)
#36. The total global market value of biotech crops in 2017 was over $17 billion. This amount represents a 9% increase in the revenues generated the year before. It is also approximately 24% of the $71 billion worldwide crop protection market. (ISAAA)
#37. Biotech canola saw the largest increases in use around the world, with an expansion of plantings of more than 1.6 million hectares. This figure represents a 19% increase. Changes to agricultural patterns in Australia, Canada, and the U.S. for more edible oils were responsible for the shift. Cotton (8%) and soybeans (3%) also saw gains, while corn had a 1% decline.
Biotech Industry Trends and Analysis
The biotech industry is still relatively new. Its greatest potential is in the discovery of compounds that treat disease, advancing personalized medicine in unique and positive ways. There are also several opportunities in genetic engineering where food products could see higher yields and better flavors.
New disciplines developed by this sector could change how we approach our health. Pharmacogenomics determines how a person’s genetic profile affects response to specific medicines, making it easier to determine what prescription should be offered for treatment. Gene therapies, nanomedicine, and new drug delivery systems are all part of the future of this industry.
As the developing world continues to expand its share of the market, there will be more opportunities to treat, feed, and help people when they have a need. Although double-digit percentage growth will not continue indefinitely, a CAGR of 7% to 10% is certainly possible for the biotech industry.
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