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By Debra Goldfarb · IDC 

 Oct. 9, 2002 | Recently, IDC conducted a pair of focus groups as part of a broader study on technology adoption across bio-IT workloads. The goal of these focus groups was to build the "dream infrastructure" to support business objectives outlined in the scenarios given to group participants. The two groups were quite different: One comprised managers and directors from mostly mid-size biotech companies; the other, senior managers and directors from large and medium pharmaceutical organizations. The rules of engagement were simple: Each group had to work together to find solutions, spend a budget, and build the "ultimate infrastructure." (The specifics on budgets will not be disclosed here.)

The scenarios were relatively straightforward. The participants in the biotech group were given the following scenario:

* You have just been hired as the chief information officer for a startup biotech company that will initially focus on using structural biology and proteomic approaches to discover and validate drug targets. The plan is that, at about the three-year mark, the company will also add capabilities in the area of lead discovery and optimization. Your task is to work with this consulting team (your peers in the group) to develop an overall plan for the IT infrastructure that will be needed.

For the pharma group, the setup was somewhat different, but built around the same underlying concepts:

* You have just been hired as the vice president of research IT for a new integrated research center for a major pharmaceutical company. This center will include the disciplines and relevant lab equipment to support an integrated team extending from genetic and proteomic approaches to target identification all the way through to Phase II clinical trials. Your task is to work with this consulting team (other persons in the group) to develop an overall plan for the IT infrastructure that will be needed.

What transpired in each group could not have been more different, exposing the range in experience between the two industries.

Through the Looking Glass 
For the biotech group, it seemed to be all about tactical solutions — Band-Aids for today's problems. And while each member of this group could wax eloquently about the future of his or her business, it proved difficult to translate that collectively into building infrastructure to support tomorrow's data problems. Solutions were evaluated across two dimensions — cost and usability. The price/performance ratio was paramount — almost at the expense of a better solution. As the evening wore on, the task seemed overwhelming, with the group struggling to spend its entire allotment of funding.

The dynamics in the pharmaceutical group were a world apart from the former group. The first comment, setting the tone for the rest of the discussion, was: "Is this budget capped? Because we believe you are off by an order of magnitude ... " And we were.

After the group deliberated, compromised, developed varied scenarios, and priced out the spectacular infrastructure it had developed, the final cost was in fact exactly 10 times what we had earmarked. Software license costs for databases, applications, middleware, security, and so on, were enormous — far outstripping our expectations. To build the storage infrastructure the "right way" was complex and expensive, with a multitiered schema supporting growth, access, and speed in the proper increments.

All "obvious" solutions were questioned and challenged, with the group reaching a consensus around innovative methods to solve the same problems. Interestingly, price/performance, overall performance, and usability were vital, but the priority was supporting the working environment and processes of their customers — the scientists. (Having a senior scientist on the team to keep the IT folks in check certainly did not hurt.)

Given spending profiles, user maturity, architectural sophistication, and other less tangible assets, it is no wonder that all the IT players are stumbling over each other as they target the top 25 pharmaceutical companies. These companies consume a lot of IT, have predictable spending and upgrade patterns, and have pervasive influence in this tightly interconnected community where social networks play an increasingly important role.

Less obvious is how the biotech community will evolve from an infrastructure standpoint. Will biotech take after the big-spending pharma industry, or chart its own path? High-profile Web sites, such as Celera Genomics Group and MDS Proteomics Inc., built around sophisticated infrastructures, are sexy, but do not represent the bulk of the market. In Celera's case, it is coming under increased scrutiny as to whether it is the emerging "role model" for the industry, or rather a company desperately trying to realign its strategy in the face of increasing investor expectations and a rapidly changing market. Are these "new" biotechs market anomalies, or do they represent the future of this industry? Probably a bit of both, depending on the time horizon.

In the short term, at least, this market will evolve around different modalities — spending and behaviors so varied that building a monolithic "go-to-market strategy" to service the bio-IT industry will be nearly impossible, and possibly suicidal, for suppliers. The challenge will be to develop strategies around products, channels, and partners that will service the diverse needs of today's markets, yet evolve over time to support the rapid changes in the science and structure of the bio-IT industry going forward.

Will biotech take after the big-spending pharma industry, or chart its own path?

Debra Goldfarb is IDC group vice president of worldwide systems and life science research. She can be reached at 

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