Overview of the Biotech industry

The biotechnology industry is an unpredictable sector due to the scientifically intensive nature of the operations conducted at the companies. The industry arose in the 1970’s with the goal of enhancing the quality of human life by servicing markets including industrial, agricultural, medical, and environmental. Biotech firms differ from the traditional drug makers in that they reject synthetic ingredients and instead utilize natural ingredients. Biotech firms are also the most research-intensive organizations in the world. Increasing demand for agriculture based products should enhance the biotechnology industry growth over the coming years, with expectations to reach USD 727.1 billion by 2025.

Some of the biggest risks Biotech companies face

Research & Development

 This stage can present various risks because of the fragile elements required and damaged materials can leave you at ground zero. Human error also contributes to R&D risk. Misplaced items, ill-followed procedures, or even everyday accidents can cause damage.

Clinical Trials

Outside the lab, biotech products must size up against real-life clinical trials. Unintended consequences, such as mutations or troubling results, have shut down development.. A study showed that only 32% of drugs have the probability of making it to Phase 3 trials and only one in 10 drugs overall actually make it to market.

Product Launch

A recent study highlights that the overall success rate for drugs, in the biotechnology industry, moving through clinical trials to FDA approved is near 1 in 10. In previous reports from earlier years, the rate of drug approvals was closer to 1 in 5.

Why is Insurance for Biotech Companies Important?

Protection of property: though many biotech startups focus on protecting their proprietary technology via patents, it is important to also consider physical property. Lab equipment, lab facilities, manufacturing tools, and many more items are worth a lot of money to a biotech operation. Property risks increase as your company experiences growth; the bigger you are, the harder you fall. 

Securing continued funding: a valid concern for many biotech companies is attracting investors. Convincing investors to continue their funding is also another common task for biotech operations. As your biotech company grows and requires more funding, it is crucial to ensure smooth and legal daily operations contributing to that growth. Insurance for biotech companies also helps you to effectively deal with the FDA and other regulatory bodies.

Sustained growth: to sustain a startups development, it is critical to support your upward movement. For many, maintaining momentum means avoiding any setbacks, such as the loss of data. The availability of your product to the public increases your risk significantly and this risk becomes more relevant as the company grows.

Get A Biotech Insurance Quote

What Insurance do Biotech companies need?

How it Works

Create Profile

Get Quotes

Sleep Well

How much does Insurance for Biotech Companies cost?

The cost of insurance form biotech companies will depend on a number of things including the size of the company and the stage of the company in its development process. Other factors include:

  • Exposures: risks being insured.
  • Company practices: views on safety, compliance, and risk management. 
  • Program structure: the amount of deductible and willingness for a company to assume more risk
  • Claims history: the type and amount of past claims against the company

Types of Biotech Companies that need insurance

Ag-biotech

Agricultural biotechnology has taken significant leaps and bounds. Many transgenic crops are the norm now, such as soybeans and wheat. Additionally, up to 90% of corn, soybeans, and cotton grown in the US are bioengineered. Ag-biotech’s main focus is crop improvement but biotech-enhanced farm animals is following closely behind.

Biopharma

Biopharma has introduced an advanced approach to drug development. The primary aim is to develop new drugs at a faster pace.

Biotech companies we work with

Learn more about insurance for Biotech companies

Plenty of risks are associated with ESOPs. But, how do they impact your current D&O, E&O, or general liability insurance policy. Here's the scoop.
Read More
Commercial insurance endorsements are the secret sauce that enable your company to grow and develop. Here's what you should know about them.
Read More
Our guide to insurance for Biotechnology companies. What risks do Ag-biotech & Biopharma face? What policies do they need?
Read More