Kevin Kinsella, the founder of VC firm Avalon Ventures, says that big pharmaceutical firms are essentially eating their seed corn—letting greed drive them into cutting deals that fundamentally undermine the health of the biotech industry that provides a lot of their innovation.
This helps to explain why so many venture-backed biotechs prefer to develop new treatments around drugs already approved by the FDA, and why they are so reluctant to develop novel drugs for heart disease, neurological disorders, osteoporosis, and other chronic conditions.
“Almost anything of that genre is absolutely not financeable today because it requires too much capital, too much time, and pharma is so predatory and unreliable,” Kinsella says.
Full article at xconomy.com. Hat tip to Megan McArdle.