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What Are the Biggest Challenges Facing Your Biotech Company?

30 November 2021

By Jay Freeman

What Are the Biggest Challenges Facing Your Biotech Company?

The outlook for so many sectors has been pessimistic or apprehensive, yet biotech continues to thrive.

Between January 2020 and January 2021, the average share price for European and US biotechs increased at more than twice the rate of the S&P 500.

Biotech is even outperforming pharmaceuticals, yet, many biotech businesses are also facing the challenges that come with such growth and investment.

What pain points are on the horizon for biotech companies?

Navigating the competition

Such an innovative sector is bound to face challenges when it comes to maintaining growth, which relies on businesses navigating technological and biological advances, whilst also contending with their competitors.

Many biotech companies will struggle with this endeavour during the scale-up stage of newer technologies and innovations, which is generally down to supply chain issues.

Due to supply chain issues during the pandemic, 67% of executives say that that the manufacturing of biopharma staples, such as biologics, would dramatically increase in their own countries over the next three years. 

This need for resilience is paramount when looking at global competition.

Countries such as Switzerland and the US have high supply chain resilience, yet are still vulnerable to scarcity.

The lack of agility is the element that could be detrimental for biotech companies, which is why more time and effort is being spent on securing both global and local supply chains.


Biotech’s response to the pandemic may have given it a reputation as an attractive investment, yet acquisitions may still pose challenges for start-ups or growth companies.

One of the difficulties facing biotech start-ups that are working to be acquired is the emergence of mergers and acquisitions (M&A) hotspots – cell and gene therapy, oncology and next-generation biologics – which attract interest from big pharma but tend to be aimed at mid-size biotech companies.

With rapid digitalisation playing such a huge role in the life sciences trend, it is unsurprising that there is a shift in industry lines as tech companies look to break into the healthcare market, and health and pharma companies look to buy tech companies to digitalise their offerings.

This is key, as it shows an emerging trend – the biotech companies focusing on innovation are likely to garner more interest from big pharma as it is a key driver and competitive advantage.

To summarise, buyer interest is dependent on how much a biotech company meets the standard of specific favoured therapeutic and technology areas, or on their clinical progress.


Whilst biotech certainly isn’t the only sector facing more pressure to move towards sustainability, that doesn’t make it any less of a pain point for many biotech companies.

Biotechnology could play a huge role in sustainability efforts, specifically in food production, renewable raw materials and energy, pollution prevention, and bioremediation.

Steps are already being taken towards this end, such as the development of technology platforms that combine molecular biology, data science, automation, and genomics to pinpoint naturally occurring molecules from which they can design products.

For biotech companies, the challenge lies in how to adopt more sustainable practices, given that investors are more than aware of the value that the sector can create towards sustainability in the future.

Slowing the use of nonrenewable sources (e.g., oil and mineral ores), and avoiding the use of renewables (e.g., water, soil, trees) at a faster rate than is replenishable are main talking points in making biotech more sustainable.

Additionally, the industrial applications of biotechnology can significantly impact the manufacturing processes, from eliminating wastes and pollutants to safeguarding natural resources.

Biotech companies that have no vision for sustainability may find themselves struggling in the future, as it is not only a competitive advantage, but a key part of CSR, which is higher than ever on the agenda of the workforce and society at large.

Talent shortages

Many sectors are facing a war for talent, however, biotech has the issue of seeking out more talent than there are qualified candidates.

Add in the necessity for more niche and complex skills, and it’s no surprise why there is a candidate shortage in biotech.

Engineering, data analytics, process development, Artificial Intelligence (AI), and Process Analytical Technology (PAT) are all emerging areas of interest that are increasingly difficult to hire for.

This can cause a significant drain on time, resources, and money for companies, which has a knock-on effect on retention of current employees.

Recruitment is therefore both a focus and challenge for biotech companies, as highly skilled talent is necessary to innovate and scale up, yet the process of hiring is costly and doesn’t always produce the desired results.

However, there is a positive outlook for the future, with rising numbers of STEM graduates, more biotechs training the next generation of talent, and a growing pool of experienced biotech executives.

Regulatory standards and compliance

During the pandemic, biotech companies conducting vaccine research in 2020 for Covid-19 were working under modified compliance standards.

These standards reduced the complexities of compliance for biotech companies, yet these modified, user-friendly changes are unlikely to become commonplace.

Additional or complex regulations cause issues around control over product pricing and delayed revenue.

In Europe, biotech companies are facing challenges around patient data privacy standards, even with GDPR, due to conflicting or competing requirements from agencies and governments.

Meeting all of the different compliance requirements can be a drain on time and resources, which makes the necessity to understand how to navigate compliance even more essential in order to avoid problems later down the line.

The need for biotechs to go global in order to expand their opportunities means that compliance is more important than ever, which might be made easier by the new lines of communication and collaboration that resulted from the pandemic.

Maintaining innovation

Continuing to innovate even under the pressures and restrictions of the pandemic has left many biotech companies wondering how they will maintain these levels of innovation, or whether they’ll risk stagnating or falling back on themselves.

With rising global competition to contend with, developing innovative assets and products can prove difficult, particularly with the newer fields that are coming to the forefront in biotech, such as gene therapy.

This ties in with the need for greater understanding around regulation and compliance, as complex products come with complex regulations.

Maintaining innovation also requires a level of competitiveness for available funds, increasing costs of developing novel products, and keeping on top of new technology to facilitate the entire process.

Biotech companies that keep up-to-date with emerging technologies and have awareness of their competitors will be well placed to continue innovating.

To summarise

All of the successes that the biotech sector is experiencing even during such a tumultuous period have left many optimistic about the future.

However, in order to continue such growth, biotech companies will have to face a host of issues.

In order to stay on a positive trajectory, biotechs will need to invest in highly-skilled talent, develop more sustainable practices, keep up-to-date with changing regulations and technologies, maintain innovation and compete on a global scale.

Though this may sound like an uphill struggle, many biotechs are already taking steps towards these challenges in the form of strengthening their hiring and retention processes, focusing on global collaboration, and putting greater emphasis on sustainability as part of their company’s CSR.

If you’re looking for highly skilled candidates for your biotech company, get in touch with the Panda team today.

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