Mexico: Biotechnology at Third Stage of Development

Last Updated: 17 January 2005

By Daniel Barrón Pastor

Biotechnology is modifying the cultural and economic relations within societies in the globalized world. Treatments and new drugs, genetically modified foods, materials, biologically controlled production processes, and many other applications, may well become part of our everyday lives improving health, agricultural, industrial, and energy production, affecting our societies as profoundly as oil or information technologies have already done.

Moreover, the knowledge of biological topics is modifying every ideology, language and conscience of humankind. The generation of disciplines such as ecology, sustainable development, biophilosophy, bioeconomy, as well as public discussion about cloning, genetically modified organisms, bioterrorism and the technological fear that involves each subject, show that life sciences are part of a major change in the conscience and perception of societies.

The cultural and economic transformations that arise from the life sciences allow to think about them as a major industrial revolution. Thus, if biotechnology shares the behavior of other industrial revolution phenomena of modern society (automobiles-or internal combustion motors, plastics, computers, etc.), then biotechnology be in a generational cycle that will span over 50 years.1

Until this moment, biotech is showing a development behavior that shares a lot of similarities with other industrial revolution generational cycles: In the first stage, the foundations of research methodologies which change how we study the subject (the biotech cycle could begin in the late 70’s and early 80’s, when we found the recombinant DNA and hybridome technologies, which change how we study biology). The second stage shows a lot of research methodologies but few discoveries that became products. The third stage is marked by a flow of innovative products derived from the new methodologies. In the fourth stage the products became incorporated into daily life, and in the final stage companies and products became fully integrated into the science research and the retail sectors of society.2

It is necessary to point out that the development of each stage is gradual and that the frontiers between them are not marked by a specific kind of event. As well, the appearance of events of a stage does not involve that events of the prior one have ended or that events of other one have appeared. Therefore, we can observe that biotech’s generational cycle is in the midst of the third stage and that there are some signs that involve the second and fourth stage.

The second stage events of the biotech’s generational cycle (a lot of research methodologies but few discoveries that became products) could be observed in the late 80’s and 90’s, specifically in the input of DNA sequences into databases (genes, genomes), the identification of function and participation in the cell and organisms physiology and the appearance of a generation of products evolved from this technologies (e.g. genetically modified crops, antibiotics, hormones etc. produced by modified microorganisms, water purification systems and new therapeutic methods and drugs). At this stage, investments were focused in research and development activities in basic research and the search/discovery of new molecular entities.

The third stage of the biotech’s generational cycle is marked by an increased flow of innovative products. This evolvement will be clearly observed in the increment of patent applications being submitted in the biotech’s category, when compared with prior years. Also, the third stage can be observed in the market wherein a large quantity of new biotechnological products are emerging.

This increased flow of products is not casual. Investors seem to be more risk conscious than in the 90’s decade, because the genomic and proteomic knowledge produced at the 90’s decade is evolving into products and, at the same time, the investors perception about research in these topics is that they need to become the high risk of the investments and a frustration feeling in terms of profits.

In this sense, Roger Longman at the 22nd JP Morgan Healthcare Conference said that "new molecular entity discovery has become so difficult to predict and localize that it may not be sensible to invest at the rates we have in the past" 3. Thus, the risks are higher in terms of the lower probability of discovery and the larger amount of capital needed for research. Also, he states that investment strategies are flowing from the risky research programs to the more secure late stages of product development:

"statistically, the drug industry and financial markets are paying therecognition of value, not new molecular entity discovery".

This change in the investment ideology is causing biotech companies to reorganize, cut back on their research programs and execute a business strategy of in-licensing products that are already in clinical development.

"To maintain anything close to traditional margins, drug developers must learn to explore the entire Research & development value chain for innovation, Longman said ‘the business development function in a company has become as important—if not more so— than the discovery function.’" 4

So, at this third stage of the cycle, the biotech industry is modifying the R&D activities in order to be more attractive to the investors, and the products derived from said new investments are signs of the incoming fourth stage of the biotech’s generational cycle.

Societies have also been modified but changes are less clear than those at industrial modifications. In the second half of the XXth century, the general attitude to life sciences advances was of surprise about knowledge, great expectations about, new medicine, caution about ecology problems, and ignorance translated in technologic fear. Therefore, the biotech industry and the nations have invested a lot of money in education, divulgation and media programs trying to keep the positive attitudes and trying to modify the bad ones. The objectives of these programs could be resumed as 1) keeping surprises that help in the development of the expectations, and 2) attacking ignorance and technologic fear.

Therefore, the impact of education programs in societies has been such way that ideologies, languages and disciplines have more terms and metaphors related to life sciences than ever in history. However, the attitudes of the ???public toward biotech seem to be the predominant until now,only that the public has much more information.

About consumers and public expectations, at this third stage of the biotech industrial revolution, the new drugs and treatments are being well accepted; the public has great expectations about the new medicine that would arise from the advances in the understanding of the human genome gene therapy and stem cells; consumers still have great confusion about ecologic and health risks related to genetically modified food and the new materials and industrial processes are quite known.

From all the above biotech industry wants to develop the local markets by introducing the new products through the public’s daily life needs and publicity, and wants to try –together with the national governments- to improve better local programs of education, divulgation, and research, in order to induce the nations to become societies of consumers (and developers5) of biotechnological products.

The introduction of new products when government and industry invest in local science development, could cause that the local communities tend to be better informed and therefore avoid adverse reactions in the acceptance of local markets caused by technologic fear.

Finally, the third stage of the biotechnology revolution is a complex challenge wherein the industry, the governments and the societies of the globalized world are being modified in order to survive to the biotech century.


1. "This cycles are part of the possible causes of long waves or long cycles of the world economy, also known as Kondratiev cycles. This cycles were known through empiric studies wherein the price tendency statistics, the interest rate and the market. Now, the economic variables related with the long waves are: 1) the technology advance and innovation (Shumpeter, Mensh and Kleinknecht); 2) the capital’s transformation and its impact in the different stages (Mandel and Forrester); 3) the effect of the long waves over the employment (Freeman); 4) the prime matter as a central variable (Rostow); 5) institutional and social modifications (Freeman, Pérez and Dosi). However, the long waves are a difficult to quantify phenomena because, in part, to the inconsistence and amplitude of the disposable statistical series." Paragraph taken from Leonel Corona Treviño, Technology, innovation and economical cycles, in Economical theories of technology, jus, CIECAS and IPN, Mexico 1999; page 130.

2. John F. Wong, Is biotech in the midst of a fifty year cycle? Genetic Engineering News –; March 1, 2005, vol 25, no. 5. Referring to interview with Nola Masterson, Ph.D.,. (Science Futures –San Francisco)

3. Roger Longman is the Managing Director of Windhover Information, Inc., and editor of In vivo: The business and Medicine report. Text from Lorraine Ruff and David Gabrilska, 22nd JPMorgan Annual Healthcare Conference Report, There’s is gold in tem that molecular tailings. July 22, 2005.

4. Roger Longman, Ibidem.

5. Developing research and production systems in developed countries will reduce costs of research, development and production, causing the construction of a strong moral-scientist leadership at reduced costs. Therefore, at this third stage of the biotech industrial revolution, profitable solutions for the industry, investors and societies, will arise when the developing countries do more –—or have more investment— in research and development.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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