Pharmaceuticals and Biotechnology

The pharmaceutical industry and biotechnology industry are gigantic entities. The total revenue of the global pharmaceutical market is well over $1 trillion dollars a year. To put that into perspective, that is roughly one-quarter of what the U.S. federal government spends yearly. Nearly half of that revenue comes from the U.S. and Canada, even though both countries only account for 7$ of the global population. Many people do not know the difference between pharmaceutical companies (pharma) and biotechnology (biopharma) companies. The different terms reflect the roots of each respective industry.


It is often said that the pharmaceutical industry started with the synthesis of aspirin in 1897 by Felix Hoffmann. Hoffmann was a chemist at Bayer. The synthesis of aspirin ultimately led to the first large-scale commercially manufactured drug. The area in Germany where Bayer was formed is sometimes referred to as the ‘Silicon Valley of industrial chemistry’. Like most early drugs, aspirin is a relatively simple ‘small molecule’ that is manufactured using industrial synthesis technology.

Pharmaceutical companies work with plant and chemical based compounds to cure or manage diseases and help fight infection. Big pharma companies typically conduct extensive in-house research and may also seek drug licensing from academia, other pharmaceutical companies, or other biotech companies. Pharmaceutical companies can produce livestock supplements, animal health products, vitamins and drugs used to treat human illness. Pharmaceutical companies tend to create drugs by synthesizing chemicals.


The biotechnology industry (biotech, biopharma) was launched in 1976 in Silicon Valley. Genentech was a combination of genetics, engineering and technology that ultimately led to the commercialization of new technology called recombinant DNA. Recombinant DNA changes the DNA of living cells, altering their internal biochemical pathways. The goal of this alteration is to produce new molecules and proteins of various sorts. The molecules created tend to be very complex, large molecules.

Biotechnology uses the applied knowledge of biology to duplicate or change the function of a living cell to better suit the need of the biotech company. The biotech sector uses advances in recombinant DNA and genetic research to develop products that can help cure or treat human illness. There are also biotech companies that are responsible for GMOs and the manipulation of crops.

The difference

The main difference between pharmaceutical and biotech companies is the method that is used to produce the drugs. Biopharma uses living organisms such as bacteria, yeast and animal/mammalian cells to produce new compounds. Pharmaceutical companies manufacture drugs through a series of chemical synthesis and artificial means. While both produce different prescription and non-prescription drugs, it is the processes that are different.

Biotechnology applications

Many biotech firms have more applications than traditional pharmaceutical companies. For example, biotech companies are behind many foods such as gluten free products and crops that require fewer pesticides. Biotech can even alter a crop to have a more complete nutrient profile. While there is an overlap between the pharmaceutical and biotechnology sectors, biotechnology’s scope seems to be larger. The cost of biotech companies tends to be greater due to their higher operating costs in research and development. It is extremely difficult to create and test new products that prove effective in treating and preventing illnesses. Biotech is a risky game due to the volatile nature of the industry. If you are risk adverse, pharmaceutical investing or employment may be more up your alley.

Biotech consulting

If you are looking to be a part of a budding biotech company, there are a few things you want to take into account. Many biotech companies are start-ups that get a majority of their funding from venture capitalists, angel investors and research grants. This gives employees a chance to be part of something new and novel. However, biotech companies often require scientists to be a jack-of-all-trades and have a very unique and specific skillset. It is much easier to stick out (hopefully for a good reason) at a biotech company than a gigantic pharmaceutical company. While this isn’t the rule, it is easy to become a very small cog in a very big machine at a pharma company.

Biotechnology Versus Big Pharma  There are undoubtedly other factors. What do you want to accomplish with your career?  One area that should be mentioned is that as a scientist, for the most part your role at a biotech company is likely to remain as a scientist, as opposed to a manager, unless the company grows quickly. The executives of biotech companies are often venture capitalists (VCs). Often those VCs have scientific backgrounds. In pharma, the possibility of a scientist heading a department, division, business unit, and eventually moving up into executive management—if that’s your ambition—is possibly greater than it is at a biotech company.  Numerous people have had highly successful and satisfying careers in either biotech companies or pharmaceutical companies, but going in with your eyes open can be beneficial. What’s right for you? Biotech poses broader duties, is riskier and more volatile, fewer jobs in general and predominantly located in the Boston and Bay area. Big pharma jobs are more stable, less risky, more jobs with more geographic diversity and less likely to have stock options.

Pharmaceutical Consulting Services

We are a trusted provider in consulting services and project-based solutions within many different sectors. We have had extensive success in the Life Sciences sector and have effectively leveraged our successes within other industries based on our performance. We are capable of placing entire teams of industry experts though our use of a robust talent pool and extensive network of highly experienced technical consultants. Whether you are venturing into the pharmaceutical or biotechnology sector, you can count on PRG to get the job done.