To reduce such waste, the drug-making industry is turning increasingly to the Internet to trade intellectual property. Semiconductor and software makers have traded intellectual property online for several years, but biotech has moved more slowly. Other intellectual property electronic exchanges are targeting the life sciences. Calif.-based Biostreet, operating since January, says it is already used by the top 20 pharmaceutical companies. A competitor, Newton-based ActiveCyte, has developed its own standard to display information about intellectual property, and was scheduled to begin a trial run this week with two pharmaceutical companies.
Some analysts are skeptical.
For larger companies, exchanges are a way to reduce waste in their licensing businesses. About 10 of those could conceivably become something useful, like a drug, DuJardin says, and the costs of those Bayer decides not to develop show up in high drug prices. Experts say consolidation is inevitable, especially since B2B is out of fashion on Wall Street, and health care e-commerce funding has all but dried up. Biostreet's confidence lies in its knowledge of the industry. ActiveCyte will charge pharmaceutical companies a subscription fee, and let sellers post descriptions of their molecules for free.