Shifting Away From Conventionality in the Life Sciences Industry in 2021: Staying Ahead of the Curve in Executive Search
If there’s one thing to be sure of in the unpredictable life sciences industry in 2021, it’s that trends are shifting away from conventionality in both diversity and inclusion (D&I); and in the business market. These trends are expected to continue into the foreseeable future, and staying informed of the following changes will keep executive search consultants ahead of the curve when it comes to industry insight.
Diversity & Inclusion
Demographic diversification of the life sciences industry workforce has been a longstanding issue. The predominately white, male makeup of life sciences teams has been recognized as a fault of the industry in recent years, with urgency to diversify leadership teams. Awareness is growing to the fact that ethnocentric conventionality hinders progress in life sciences companies with an underlying goal of improving quality of life for all humans. Gender and cultural diversity broadens knowledge, and strengthens productivity and responsiveness in unpredictability. By drawing from varied backgrounds and experience, an organization becomes more agile and resilient in business strategy and relations.
The best executive search consultants should be able to comfortably discuss with executive biotech leaders, that a diverse team of individuals benefits their company. This is because diversity drives profitability, encourages and supports innovation, provides greater insight to the needs of female and ethnically diverse consumers (two groups which are growing steadily in purchasing power), and makes the company more appealing to top talent and potential investors (Harris, 2020).
The life sciences industry in 2021 has made some progress with regards to building and supporting a diverse workforce, and this is only expected to continue. Innovative ways in which companies are prioritizing D&I include publicly supporting legislation which promotes D&I, holding education sessions around D&I and unconscious bias, designing clinical trials prioritizing diversity, and directing internal research on diversity (Harris, 2020).
In the Business Market
With record-breaking M&A activity in 2019, industry analysts were skeptical that the same would occur in 2020, especially as the world waited on 2020 U.S. election results (Bell, n.d.). Then when the pandemic hit, market activity froze for a few months in the second quarter, as companies adapted to conducting business virtually. Although M&A activity picked up steadily by the end of 2020, hesitation and time lost at the beginning of the year prevented exceeding 2019’s annual M&A totals (Bell, n.d.).
Since dealmaking activity has normalized once again after the unpredictability of last year, a few industry trends are emerging, and are worth following as the industry continues to evolve, which could potentially lead to significant changes in the healthcare industry as a whole.
Whereas investment from big pharmaceutical companies into smaller biotech has dominated the industry for years, a growing interest in healthcare over the past decade has spurred investment from private equity firms, creating broader competition in the market now that pharmaceutical companies are not solely competing against each other for industry dominance (Bell, n.d.).
Another pertinent change challenging the conventional structure of the market is the increasing power biotech companies have independently of big pharma. This trend is occurring due to exceptional increases in investment from VCs and public investors. “Data from Pitchbook and SVB Leerink show that venture deals in this space came close to $25B last year, an increase of more than 50% from 2019” (Bell, n.d.).
Lastly, SPAC acquisition of biotech companies with promising platforms has flourished in the past year, especially with the volatility of the market due to the pandemic. SPACs, or “blank-check companies” significantly decrease the time it takes to go public, “thus increasing capital influx more quickly than a conventional IPO” (Huddleston, 2021). Whereas an IPO may take 2-3 years to come to fruition, merging with a SPAC may make a biotech startup flush with cash in 2-3 months.
From an executive search perspective, if biotech companies are able to operate with greater independence from large pharmaceutical companies for longer, then more opportunities are afforded to executive search consultants to place top talent. Self-standing biotech companies require the recruitment of talent from their own networks and outside of conventional in-house recruitment teams often found in large companies, making the best executive search consultants an invaluable resource for emerging biotechs.
If you’re interested in learning more about G&E Partners’ Talent Management approach to executive search, please reach out to one of our expert consultants on the life sciences team.
Bell, J. (n.d.). 5 trends in biotech dealmaking to watch in 2021. Biopharma Dive. https://www.biopharmadive.com/trendline/biopharma-dive-outlook-2021/119/
Harris, E. (10 August 2020). Driving diversity and inclusion in life sciences. Cell & Gene. https://www.cellandgene.com/doc/driving-diversity-and-inclusion-in-life-sciences-0003
Huddleston, T. (30 January 2021). What is a SPAC? Explaining one of wall street’s hottest trends. CNBC. https://www.cnbc.com/2021/01/30/what-is-a-spac.html