Cynthia Robbins-Roth, Ph.D is the founder of BioVenture Publishing Inc. and BioVenture Consultants.  Dr. Robbins-Roth has been a prominent consultant to the Bioscience Industry since 1986.  She has also written for Forbes Magazine, and is the author of  "From Alchemy to IPO: The Business of Biotechnology."   

Cynthia has worked as an advisor or board member for a number of start-ups, and points out that adequate IP protection is a requisite for investment in most cases.

"For start-ups, IP protection reduces the risk for investors that they might be investing in something that others can easily co-opt. The reality is that in most cases, if you have not protected your IP, they will not invest in you.

Having worked extensively with companies developing new drug discovery techniques, drug delivery methods, and compounds, she also sees patent protection as a method of balancing technology risk.

"With new therapeutics, you never know in advance what is going to be successful. So much time and money is needed to figure out if you've even got a product, that if you don't have strong IP protection, the risk of someone doing an end run is perceived to be very high. You don't want to waste that decade of development time."

Even so, she does point out that successful firms are built on much more than simply a strong idea or patents.

"In the end, you need to have a team that is bright and capable in order to get a product out. You can go ahead an patent everything you want, but if you don't have the right team, it isn't going to generate anything for you."

This is no small challenge. Cynthia points out that specialized and innovative start-up companies, because of their heavy focus on pioneering new technology, often have trouble recognizing the difficulties of successfully bring products to market and building a business around it. 

"My experience with visionaries is that they often under-value the contributions of the non-scientific perspective. They underestimate the challenges to building a business as opposed to running a research project. They have no clue about the complexity of it, and how much they don't know. They sometimes assume that if they can learn something as complex as, say immunogenetics, then they can surely learn the business end.

It wasn't until I moved from the lab to the business side, that I understood. As a scientist, you have spent a large part of your life in a rarified environment, and have no idea about what has to happen to build a business. You tend to think that your initial invention is the hard part, and that it's all downhill from there."

The risk of underestimating the path from invention to market-ready product is exacerbated by pressures from venture capital boards to pursue whatever is the momentum play of the moment.

"One of the challenges for start-ups is that as the sector looks for the next big thing, there is tremendous pressure on firms from their investors to accelerate commercialization to meet the capital markets short-term demands, which can be very destructive. There will always be great technology, but how do you generate a sufficient number of competent managers who are very knowledgeable with both the science and business end, and are therefore able to build a company and are willing to stand up to their boards?"

The pharmaceutical and biotechnology industries unquestionably possess some unique attributes, such as the decade-long development process, budgetary constraints in the end-market, and regulatory issues. Because of the heavy focus on innovation and IP, however, the industry offers some lessons that can be applied broadly to other technology sectors.

From Hunter or Hunted - Chapter 5