Pharmaceuticals and Biotechnology
The coronavirus pandemic has been a major focal point for the pharmaceuticals and biotechnology industry since it began in Wuhan, China, in late 2019. From pressure to develop vaccines and treatments for the virus, to following pandemic protocols to protects its own workers, the pharmaceuticals and biotechnology industry worked through disruptions and challenges in 2020 to achieve much in a short period of time. As described in a McKinsey and Company report, the industry "has kept its innovation engines humming to find new treatments and cures and has taken steps to prevent drug shortages, secure supply chains, offer vital support to physicians and clinical trials, repurpose existing drug therapies, and develop highly efficacious vaccines. And it has done all that within unprecedented time frames, under enormous scrutiny, and with intense external engagement." As of March 2021, three vaccines had been emergency-use authorized by the Federal Drug Administration for the prevention of COVID-19: Janssen/Johnson & Johnson, Moderna, and Pfizer-BioNTech.
Moving forward, the pharmaceuticals and biotechnology industry will continue to grow. The research group IBISWorld predicts that the brand name pharmaceutical manufacturing industry will expand through 2026, in spite of the growing market competition and scrutiny over pricing of branded products. Revenue prospects may be dampened somewhat by the movement to offer low-cost drugs to the health care system. In early 2021, there 2,273 brand name pharmaceutical manufacturing companies in the U.S., including Johnson & Johnson and Pfizer. The biotechnology industry had minimal revenue growth in 2020, due to the economic slowdown and increased investor uncertainty. This industry is projected to regain ground through 2025, as the economy rebounds and investment levels rise. As of late 2020, the U.S. biotechnology industry was valued at $102 billion, with 2,650 businesses employing a total of 273,280 people.
Global drug sales reached $1 trillion for the first time in 2014 and reached $1.2 trillion in 2018. Drug sales in the United States are projected to grow from $395.2 billion in 2014 to $685.45 billion by 2023, according to NAVADHI Market Research. Revenue is growing as a result of aging populations, the increasing prevalence of chronic lifestyle diseases such as diabetes, and improving availability of reimbursement for drugs and medical treatments.
On the other hand, the innovative pharmaceutical industry is “currently facing unprecedented challenges caused by slower sales growth, expiring patents, increasing competition from generics, shorter product life cycles, tighter regulations, adverse media coverage and reputational damage, and a decline in the number of new innovative drugs under development,” according to the International Trade Administration. “The industry is adjusting to a more competitive environment by shifting manufacturing and other operations overseas, revamping research pipelines, reducing employment, particularly in sales but also in manufacturing and research, and organizing mergers and acquisitions.”
Major factors that affect employment in the pharmaceutical industry include the rising costs of research and development (it costs an average of $1 billion to develop each drug that gets approval, according to a study by the Journal of the American Medical Association) and the outsourcing research and development and manufacturing to emerging countries such as India and China. “Although the United States remains the global leader in innovative R&D investment, producing more than half the world’s new molecules in the last decade, its continued leadership cannot be taken for granted,” according to the International Trade Administration. “R&D performed in the United States has become increasingly expensive relative to emerging economies in Asia, such as China and Singapore, where governments have enacted policies to attract investment and are poised for future growth. Conditions that limited R&D offshoring in the past, such as market proximity and availability of talent, are rapidly shifting.”
Other factors that affect employment include government pressure on pharmaceutical manufacturers to cut drug prices, mergers and acquisitions that have reduced the number of workers in the industry, and improvements in manufacturing technology, which have increased worker productivity.
Shorter exclusivity periods—the amount of time a drug company can hold a patent on a particular drug—also affect large pharma companies. Generic drugs have more than quadrupled their share of the prescription market—from 18.6 percent at the end of 1984 to 90 percent in 2018, according to IQVIA, a provider of advanced analytics, contract research services, and technology solution to the life sciences industry.
Despite these challenges, the future is still bright for the pharma/biotech industry. The growing elderly population will need new medications and treatments. The increasing number of public and private health insurance programs, which cover some or all of the costs of drugs, will help people afford medications and create more demand for pharmaceuticals. The growing popularity of “lifestyle” drugs that treat non-life-threatening conditions and that increase human happiness and/or confidence will also safeguard the future of jobs in this field. Examples include drugs that are used to treat obesity, baldness, impotence, and the effects of aging, as well as medications that improve mental agility. Demand for over-the-counter (OTC) drugs is also expected to increase as the population grows. In 2018, sales in the OTC drug industry reached $35.2 billion, according to Statista.com. It is estimated that there are 100,000 OTC drug products marketed to consumers. Also, although the pharma/biotech industry is not immune to economic downturns, the brunt of a bad economy is softened because many people depend on medications for routine—and/or life-sustaining—health-care needs.
Faster-than-average growth is expected for professional specialty occupations. These include life and physical scientists in research and development, systems analysts, data scientists, biostatisticians, and computer support specialists. Steady employment growth is expected for biomedical engineers and bioinformatics specialists. On the other hand, Science reports that chemists working for “Big Pharma” companies have suffered considerable job losses “as the industry has moved away from small, chemically designed molecules toward large biologic molecules.” The silver lining for chemists, however, is that, according to Chemjobber, contract research organizations are hiring a large number of these laid-off workers. As a growing segment of the pharma/biotech industry, sales and marketing should provide more jobs as drug companies continue to encounter strong competition in both domestic and foreign markets.
Fewer opportunities are expected in administration and production. Little or no change in employment is projected for administrative and clerical workers as companies streamline operations and rely more on computers. Production jobs will decline or experience little growth as technology improves efficiency and reduces the number of workers needed to oversee production processes.
Advances in biotechnology have had a major effect on the drug discovery and development process. Biopharmaceuticals is the largest biotechnology subsector, and opportunities for life and medical scientists will be strong because biopharma companies invest so much money in research to identify the next hot biopharma product. More than 300 new biopharmaceutical medicines have been approved for use in the last decade, according to Pharmaceutical Research and Manufacturers of America. Approximately 900 biotechnology medicines and vaccines are currently in development to treat diseases such as cancer, diabetes, and heart disease. “Biologics now account for over a third of all new drugs in clinical trials or awaiting FDA approval,” according to the International Trade Administration.
Another emerging subfield in pharmaceuticals is ethnobotany. Interest in this field should stimulate competition and job growth as pharmaceutical companies rush to take advantage of the world’s diminishing biodiversity, especially in tropical regions. Good opportunities should exist for chemists, pharmacologists, biologists, science technicians, research and development managers, and marketing and sales workers. Those with doctoral degrees will have the best employment prospects.
Global medical technology revenues are expected to increase from $369 billion in 2015 to $595 billion in 2024, according to EvaluateMedTech® World Preview. Employment in the field is expected to remain steady as advances in technology, such as the development of implantable defibrillators and new imaging modalities, create demand for workers. Factors that may limit growth include increasing government regulation and changes to the health-care industry, which may influence purchasing trends for medical technology.