How quickly a biotech company can: do experiments, analyze results and make decisions is directly related to how quickly it will burn through its cash reserves and close its doors.
A small biotech company can burn through $200 million in cash very quickly.
In 2002 I was really impressed with some scientists I met from a startup called Avalon.
In 2005 Avalon Pharmaceuticals raised over $250 million during their IPO. This company had the cash and the talent to make big things happen.
In May of 2009 Avalon was sold to Clinical Data Inc for $10 million.
Things happen quickly in biotech so maybe the process by which they operate should be as agile.
The experimental process has an over abundance of waiting and in the biotech world "Time" is your biggest cost.
I'm not talking about the hourly cost of the FTE but the cost of coming in 2nd place. The drug that gets to market first gets the patent and the lions share of the profits.
I've even known researchers who were days away from locating a cancer causing gene when their competition called a press conference to announce that they had isolated it.
Re-work should be considered a sin because its cost is way too high.
Too often the R&D freezer is piled with partially completed experiments. How much "Time" was wasted on the experiments that were never completed?
The cost of biotech reagents is huge. I used to run an experiment every day that was equivalent to the cost of my annual salary. Being aware of this fact made me take my job more seriously. Your staff should know the cost of all of their reagents so they understand the cost of wasted effort.
Scientists need to do more planning of their experiments. Planning should be a team oriented approach with a specific goal in mind.
With the proper use of PDCA and the implementation of long term SMART Goals scientists will move consistently in the correct direction.
Having a team approach gives empowerment to its members and keeps everyone informed. A small biotech company can lose its direction quickly so keeping everyone focused is a top priority.
Lean fits in exceptionally well in the biotechnology industry. Those companies that embrace it will lead the discovery process, increase their worth and either have successfull IPO's or be prime acquisition targets.
