Early Briefing: Struggles in Biotech
Rockville-based Human Genome Sciences got a drubbing on Wall Street earlier this month after results for of a study of hepatitis C drug Albuferon. The difficulties the company faces are replicated throughout the pharmaceutical and biotech industries, which are under increasing pressure to garner huge profits from their drug treatments to recoup hundreds of millions of dollars in research and development costs. The process, which takes a dozen or more years, is becoming more competitive and more expensive.
Kim Hart also looks at biotech in her Download column, reporting that some companies are looking for ways out. The most feasible way to do so is to find a buyer, and few companies large enough to make acquisitions are willing to shell out that kind of cash these days. Raising money by entering the public markets is increasingly difficult for companies in all areas of the technology industry.
"A lot of companies have put themselves up for auction in the last six to nine months, but they've failed," said Gordon "Rusty" Johnson, managing director of Piper Jaffray and Co. "There are many mid-sized and small companies that are struggling and are, in some cases, in desperate straits."
Tom Heath's Value Added column focuses on one successful reinvention, Alexandria-based Global Printing was facing the abyss seven years ago when the millions of catalogs and manuals it prints began migrating to the Web. So owner Jonathan Budington transformed Global from an old-line manufacturer into a state-of-the-art consulting service.
David H. Stevens, president of Washington's Long & Foster, is expected to be selected today to run the Federal Housing Administration, Dina ElBoghdady reports. If confirmed by Congress, Stevens would be the only FHA commissioner in recent years with a strong background in single-family home mortgages. His more than two decades in the financial services industry appealed to the administration, sources said.
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