Updated March 07, 2014.

The rules are changing in the life sciences sector around the globe. What worked for innovation and profitability previously no longer yields the same stellar results. Instead, mature and emerging markets have both had to shift their strategies to remain viable for long-term growth, or even merely just stability.

It seems that mature and emerging companies, and thus the markets in which they physically cluster, are meeting in the middle.

What I mean by that is, each type of company is adopting some of the strategies of the other.

For example, mature companies in mature markets, rather than strictly pour billions of dollars into research and development of novel drugs, hoping to discover the next blockbuster, are now incorporating some generic brands to keep cash coming in. These same established companies, perhaps known for research and development in human life sciences, have expanded their investment in agro sciences for agricultural product solutions. In other words, former niche companies who perhaps made their name throughout the twentieth century in cardiovascular medications, for example, are now broadening their offerings to sustain their business.

Interestingly, the same proves true from the other direction. Emerging companies in emerging markets such as India, China, Columbia, and Brazil, to name a few are moving away from their original and earlier strategy of low investment in research and development and high investment in manufacturing generic drugs.

 

Now, life science companies in emerging markets are investing in developing their own new medications. This is a good sign of the times for a few reasons.

One driver of this phenomenon is the rising standard of living in emerging economies. Governments in these countries are investing in a more highly-educated workforce. That highly-educated workforce is demanding better healthcare. At the same time, emerging economies are providing incentives for native companies to stay and grow in their home country, especially when focused in the life sciences. These companies need a highly trained workforce. 

Additionally, the incentive programs are also proving attractive, not only to native-owned companies, but multinational corporations as well. Thus we see more multibillion dollar corporations locating new research and development labs, as opposed to their former strategy of just manufacturing, to these same emerging countries.

All of these drivers, economic incentives, a highly-educated workforce that demands better healthcare, all compound a synergistic effect on how they are marching forward. This path leads them toward their own journey to market maturity. 

As a result, more clusters are emerging globally. Clusters, as we've explained in other articles, are the result of innovative minds wanting to work near each other. Collaboration has proven to be a relevant factor in life science discovery, research, and development. 

To learn more about the life sciences sector, the medical supplies careers it has created, and the regional clusters' leading employers, read:

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