Executive Search Insights: Is Making the Move to a Platform Company a Safe Bet in the Current Market?
Platform biotech companies have been considered some of the most cutting-edge, technologically sophisticated through the biotech boom of the last decade. Platform technology enables companies to broaden and diversify portfolios without needing to rely on a single asset for success. These companies take a fail-safe approach: If the platform fails for a specific target, the company has other options to fall back on, and if the platform is successful the value of the company skyrockets. (Fidler, 2022).
To date the platform model has wildly garnered private investment and IPO launches, as well as enticed talent. But in the current risk-averse market platform companies are making investors think twice when it comes to long-term staying power, resilience in weathering the market situation, and ultimately fulfilling the promise of bringing new therapies to patients.
Platform companies subscribe to older paradigms of biotech funding – big promises without a guarantee of short-term, revenue-generating deliverables. They are often early stage with broad targets, are expensive to fund and to run, and can require large teams with varied expertise.
As discussed in an earlier article, biotechs appealing to investors now are already generating revenue, and in partnerships with big pharma and other companies. They are consolidating staff and portfolio projects to make best use of finite cash runways. These are areas where platform companies tend to fall short. Many top-funded platform companies received millions over multiple private funding rounds before ever producing a valuable product. Others have tried for IPOs before even selecting drug candidates. And one biotech consulting and research firm found that of the 500 biotech companies that went public since 2010, seven of the top 10 underperformers were platform companies (Fidler, 2022).
So, is making the move to a platform company a safe bet in the current market? Like many complex decisions, it depends. From a Talent Management perspective, when asked what will present the best new opportunity in terms of growth and challenge, it is common for candidates to mention a platform or company with a broad portfolio. On the other hand, equally as important for many is something dependable, a company with good funding, a few partnership deals, and a solid cash runway.
It is important to understand that while companies with both exist, it can be challenging to find a role that ticks all the boxes, especially with pools of available talent growing. It’s wise to assess where there is room for compromise. Does a sophisticated platform with many disease targets take precedence over a well-funded company restructuring its resources into one promising asset? Would it feel more meaningful to be part of a small, dedicated team that has continually, incrementally progressed a new drug through regulatory milestones with steady funding? Is it feasible to move to an early stage, cutting-edge company with generous equity and stock options, but perhaps a lower annual salary?
These are all difficult questions to answer in today’s rapidly evolving industry. Taking time to reflect on honest answers is one of the hallmark qualities the Executive Search Consultants at BayBridge see in the top 1% of talent. We are here as your advisors. Not only can we guide you to make the wisest decisions for your situation, but we also provide market insight to align your career vision with market intelligence. Get in touch today to discuss your career goals.
Sources
Fidler, B. (26 July 2022). ‘Flat is the new up’: After biotech correction, venture investors turn to safer bets. Biopharma Dive. https://www.biopharmadive.com/news/biotech-venture-startups-downturn-platform-safer-bets/627858/