Prospering in a Down Market: Strategies for Life Science Suppliers

Prospering in a Down Market: Strategies for Life Science Suppliers Executive Summary Page 1 of 7

©2009 BioInformatics, LLC

EXECUTIVE SUMMARY

Prospering in a Down Market: Strategies for Life Science Suppliers

REPORT #09-001 March 2009

Print: $3,200 $2,700Electronic (.pdf): $5,200 $4,500

Enterprise: $7,940 $6,750

Overview

With an estimated $21.5 billion in federal research and development (R&D) funding signed into law on February 17th, many suppliers are breathing a sigh of relief that the life science market will be immune from the global economic crisis. But it is unclear how quickly these funds will be released, what programs will be funded, and how much of this infusion will translate into purchases of instruments, kits and reagents. In the meantime, pharmaceutical, biotechnology, academic and government labs continue to react to the deepening recession with budget freezes and staff reductions. In fact, 65% of the scientists surveyed report that their research has already been affected by the downturn in the economy.

During this tumultuous time in our industry, the opportunity for life science suppliers to thrive—rather than survive—will be predicated on a detailed understanding of how labs will allocate 2009 funds. This report, scheduled for release in March is designed to provide guidance, backed by hard data, as to how scientists plan to cut corners, modify experiments and change purchasing behaviors in response to shrinking budgets. With unparalleled access to the voice of the customer, BioInformatics, LLC analyzes in this report the broad scope of how scientists plan to control lab costs, what products will be affected and the degree of concern scientists have about the economic climate.

Providing a roadmap for the life science supplier, this study compares and contrasts FY2008 (actual) and FY2009 (projected) budgets, revealing anticipated trends and changes. Expenditures for capital equipment (greater than $25k), instrumentation ($25k or less) and consumables are detailed, and sources of funding for research and drug discovery are listed for both years. Fourteen product categories are examined using multiple variables, including current suppliers, price points that increase likelihood of switching and projected expenditures through FY10. Additionally, the respondents provide insight as to how their labs are adapting to this crisis—65% of those surveyed say their organization has already implemented a hiring freeze and 63% are delaying or canceling non-essential purchases for their labs.

Quick responders will win in this tight economy. Prospering in a Down Market: Strategies for Life Science Suppliers is not only a compilation of how life science customers are planning to allocate 2009 budgets; it also outlines in detail how scientists expect suppliers to respond. Scientists share their opinions about how suppliers can differentiate

themselves, and what types of incentives, discounts and packaging would entice a lab to purchase more. The study also includes feedback as to whether or not scientists will turn to vendors for advice—on how to conserve reagents, how to preserve the shelf-life of instrumentation and how to go “green,” thereby counting on suppliers to become more involved in promoting efficient operations in the lab.

With a fifteen-year tradition of informing life science supplier strategy, BioInformatics’ March release of this report will make the first step of decision-making—finding out how customers plan to spend their money—both timely and accurate. In light of budget cuts and in the spirit of collaboration with life science suppliers, Prospering in a Down Market: Strategies for Life Science Suppliers will be available at a pre-release price of $2,700 (print copy only), $4,500 (electronic plus print copy), or $6,750 (enterprise) until March 15, 2009. A comprehensive study packed with responses from the people who have budget authority and/or make purchasing recommendations in the lab, this report is mandatory for the life science supplier who intends to come out ahead in 2009.

Contact us at 703.778.3080 x13 to review the study questionnaire fielded to more than

500 U.S. life scientists.

How This Report Can Be Used

• Prepare to answer the urgent questions from Boards of Directors, analysts and investors.

• Pinpoint areas of growth, stability and decline by market segment, region and product category

• Reposition marketing and sales resources across major product categories.

• Tailor marketing programs to enhance customer loyalty and prevent switching to lower cost suppliers.

• Focus R&D and Product Development on areas of growth.

This pre-publication discount price is only available until March 15, 2009!

2111 Wilson Blvd Suite 250

Arlington, VA 22201www.gene2drug.com

703.778.3081 (fax)

BioInformaticsmarket insights from gene to drug

I. The Impact of the Economic Crisis on Laboratory Budgets

• Fiscal year starts/ends

• FY08 Lab budget

• FY09 Lab budget

• Percentage spent on

Capital equipment (>$25,000)

Instrumentation (<$25,000)

Consumables

Other

• Sources of funding FY08 and FY09

Percent of funding by source

Anticipated change in FY09

Anticipated change in through 2011

II. Scientists’ Reactions to the Current Economic Climate

• Impact economic recession on current research

• Level of concern

Perception of overall impact compared to other

Specific budget cutbacks in the lab

Specific budget cutbacks in the institution

• Overall impact on purchasing

• Changes in grant applications

III. Anticipated Changes in Laboratory Purchases in 14 Product Categories

• Products in use/Primary Supplier

Cell biology instruments—Flow cytometer-based

Cell biology instruments—Microscope-based

Cell biology kits and reagents

Cell culture media and reagents

Computer hardware

Gene expression analysis products

High throughput screening and analysis systems

Image analysis systems

Instrumentation for genomic analysis

Instrumentation for protein analysis

Laboratory plasticware

Nucleic acid purification and separation products

Protein purification and separation products

RNAi products

• Anticipated change in purchases by product category

• Planned capital equipment purchases by product category

• Potential for customer switching

IV. The Adoption of Cost-Saving Lab Practices

• Cost saving measures employed

• Planned Cost saving measures

Bulk ordering

Change direction of inquiry

Conservation measures

Decrease/stop long-term experiments

Defer capital equipment purchases

Delay/cancel nonessential purchases

Downsize staff

Halt new initiatives

Increase energy efficiency

Increase the use of core facilities

Lease instrumentation

Outsource work

Participate in “reagent rental” programs

Postpone or suspend projects

Postpone or suspend specific experiments

Purchase through alternative channels

Purchase/acquire used instrumentation

Purchasing groups

Reduce/cease experiments with animals

Rent instrumentation for the duration of a project

Reuse products

Share resources with other labs

Standing orders

Switch to less expensive alternatives

• Interest in used lab equipment

• Impact of cost saving measures on service contracts

• Attractiveness of special offers from suppliers

• Interest in assistance/advice of suppliers

• Credibility of supplier advice

• Interest in environmentally-friendly products

Additional Analysis by

Years of experience

Lab size

Purchasing authority (consumables)

Purchasing authority (instrumentation)

Product category

Market segment

U.S. geographic region

Appendix A. Verbatim responses to the questions:

• Despite this economic recession, is your lab planning on adopting new technologies this year? Why or why not? If so, which technology(ies) will your lab will be adopting?

• Do you think your research or the research in your field will change due to policies implemented by the new presidential administration? Why or why not?



Report HighlightsProspering in a Down Market: Strategies for Life Science SuppliersREPORT #09-001

Prospering in a Down Market: Strategies for Life Science Suppliers is based on responses to a 43-question online survey conducted by BioInformatics, LLC. The questionnaire was completed by 530 life scientists in the U.S. between January 30 and February 2, 2009. To be eligible to complete the questionnaire, all respondents were required to demonstrate knowledge of the laboratory’s annual budget and be regular users of at least one of the 14 specified product categories. The questions were answered by highly-qualified members of The Science Advisory Board™. BioInformatics sponsors The Science Advisory Board™, an online community of more than 40,000 scientists engaged in basic biological research, clinical research and drug discovery and development. These experts have agreed to make themselves available to answer questions including emerging areas of research, the tools and techniques used in their labs, and their satisfaction with their current suppliers.



Methodology

A Highly-Qualified Survey Population

The 530 scientists were pre-screened to ensure a representative sampling of the U.S. life science market reflective of our clients’ product offerings in 14 product segments.

All Major U.S. Market Segments Represented Perspectives From Across the Life Science Spectrum

Academic

53%Industrial

39%

Government

8% 71%

32%

18%

17%

16%

12%

3%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Basic research

Drug discovery/development

Preclinical research

Translational research

Clinical research

Molecular diagnostics

Other

Prospering in a Down Market: Strategies for Life Science Suppliers, BioInformatics, LLC’s first report of 2009 provides detailed insight into each of the following topics:

• Understand current sources of funding for research and drug discovery and what effect the current economic situation will have on each, including a FY2008/FY2009 comparison.

• Measure life scientists’ near-term level of concern with the impact of the economic crisis on their lab's operating budget.

• Correlate level of concern with planned purchases in 14 product categories.

• Identify strategies life scientists intend to employ to “stretch” budgets and suggest effective positioning and marketing programs for suppliers.

Report Objectives

(continued)

The Voice of Experience…With Purchasing Authority

Budget Authority—Instruments Budget Authority—Consumables

Less than 5 years

0% 5 to 10 years

15%

11 to 15 years

29%

16 to 20 years

24%

21 to 25 years

15%

More than 25 years

17%

Evaluate

instrumentation and

make recommendations

54%

I have budget authority

for and/or authorize

these purchases

43%

End-user only

3%

Evaluate consumables

and make

recommendations

37%

End-user only

3%

I have budget authority

for and/or authorize

these purchases

60%

A Highly-Qualified Survey Population (continued)



A Breadth of Scientific Knowledge and Job Responsibilities

15%

16%

17%

20%

21%

23%

26%

41%

41%

49%

0% 10% 20% 30% 40% 50% 60%

Oncology

Microbiology

Protein Chemistry

Immunology/Virology

Genetics

Drug Discovery/R&D

Biotechnology

Cell Biology

Biochemistry

Molecular Biology29%

25%

19%

12%

11%

3%

3%

0% 5% 10% 15% 20% 25% 30% 35%

Staff Scientist

Principal Investigator

Lab Director/Supervisor/

Coordinator

Post Doctoral Fellow

Professor/Teacher

Laboratory Technician

Other



Other Recent Publications*

Life Science Marketing

#08-047 The Brave New World of Scientific Publishing November 2008 154 Pages

#08-019 Enabling Discovery: The 2008 Life Science Industry AwardsTM June 2008 101 Pages

#08-008 Instrumentation Service Contracts: Opportunities for Differentiation July 2008 136 Pages

#08-007 Protein Research: Strategies for Marketing to Chemists and Biologists September 2008 123 Pages

#08-006 Understanding Switching Dynamics: Maximizing Customer Retention in the Life Science March 2008 173 Pages

#08-004 Life Science Product Catalogs: Techniques to Increase Sales March 2008 92 Pages

#08-003 Conference & Exhibit Strategies in the Life Sciences: What’s Working Now February 2008 135 Pages

#08-002 Advertising to Life Scientists: Resolving the Print vs. Online Dilemma February 2008 105 Pages

#08-001 Marketing to Life Scientists: Capturing Customers’ Attention in Applied Markets January 2008 156 Pages

#07-080 Marketing to Life Scientists: Exploring China & India December 2007 167 Pages

#07-069 Brand Positioning in the North American Life Science Market October 2007 930 Pages

#07-056 Customer Satisfaction & Loyalty in the Life Sciences: Boosting Profit Through Exceptional Service & Support August 2007 129 Pages

#07-011 eCommerce Strategies for the Life Science Market June 2007 180 Pages

#07-015 Improving Sales Rep Performance: Life Scientists’ Perspectives April 2007 189 Pages

#07-001 eMarketing to Life Scientists: Amplifying Your Marketing Message February 2007 171 Pages

Why Purchase Our Reports?Our published reports have several unique qualities that create value unmatched by other firms:

Sources of Independent, Unbiased ResearchUnlike reports from other firms that are based on an analyst’s subjective summary of information from publicly available sources, our reports are based on the results of detailed surveys of hundreds—even thousands—of scientific and medical professionals who buy your products.

Developed by a Team of ExpertsOur questionnaires are developed by a multi-disciplinary team of scientists, industry veterans and market research experts with years of experience. These professionals understand that survey questions need to be asked in a way that ensures the answers will directly address the business challenges you face. Once the survey data is collected, this same team creates a unique report that presents the reader with a thorough understanding of the topic and the scientific and business implications of the results based on sophisticated statistical analytics.

Carefully Selected Survey ParticipantsWhen others promote results from their online surveys, they fail to mention the uncontrolled nature of their broadcast email invitations. To provide you with the most valid and accurate results possible, the respondents to our surveys are

members of our unique online panel—The Science Advisory Board—which consists of more than 42,000 verified life science and biomedical professionals who have agreed to take part in our surveys, focus groups and other market research activities. These respondents are carefully selected based on their professional qualifications, market segments and geographic regions—we can even select them based on the products they use and their preferred suppliers.

Complimentary Consulting ProvidedWith your purchase, we offer one free hour of consultation with our talented team of scientific and business analysts who created the report. During this consultation, we can answer any questions you may have about the survey results and what we believe to be the significant trends affecting the market.

Custom Analysis & Research AvailableIf you’d like to delve deeper into the data from a study, we can always perform custom cross-tabulations or other analysis on your behalf. We can even pose follow-up questions to respondents who answered in a particular way or conduct a custom study to extend your knowledge.

*See Web site www.gene2drug.com for a complete listing.

http://www.gene2drug.com



About BioInformatics, LLC Since our inception in 1994, BioInformatics has provided critical market intelligence to leading companies serving the life science, medical device and pharmaceutical industries. We support clients across the entire market spectrum—from scientific research to diagnostics and therapeutics—providing high-level management with market insights from gene to drug.

Our multi-disciplinary team of scientific experts and business analysts creates value for our clients by combining extensive industry knowledge and experience. We offer a variety of products and services that enable executives to see themselves, their market and their competitors through the eyes of the most important information source of all—customers. We can precisely meet the needs of our clients through the most appropriate mix of research methodologies, including:

• Online Surveys• Online Focus Groups• Mail Surveys• Telephone Interviews

Our strength lies in our ability to integrate our understanding of science and medicine with cutting-edge market research techniques. As one of the first firms to recognize how the World Wide Web has transformed market research, BioInformatics formed The Science Advisory Board. Launched in 1997, this global community currently consists of more than 42,000 life science researchers, physicians and biomedical professionals who convene regularly via the Web to voice their opinions on a wide variety of issues relating to biomedical research and clinical technologies. Clients tap into this panel of experts and receive answers to their critical marketing questions in days, rather than weeks. In addition to providing real-time insights into the perceptions of the market, posing questions to The Science Advisory Board offers substantial cost savings over gathering information via traditional market research techniques.

BioInformatics offers both published reports and custom research services. Published reports allow marketing professionals to share in the results of broad-based market studies that provide access to high quality research at an affordable price. Our custom research is tailored to the specific needs of the company’s executive management. For more information about BioInformatics’ product and service offerings, please visit our Web site at www.gene2drug.com, call 703.778.3080 or email [email protected].

Biotechnology/Life Science454AbCamAccelrysAffymetrixAgencourt BioscienceAgilent TechnologiesAmerican Type Culture

CollectionAnachemAntibodies By DesignApple ComputerApplied BiosystemsApplied PrecisionAxxoraBD BiosciencesBeckman CoulterBiacoreBio-Rad LaboratoriesBioneerBiotageBioTroveBlue Heron BiotechnologyCaliper TechnologiesCallida GenomicsCambrex Bio ScienceCarl ZeissCell Signaling TechnologyCellianceCharles River LaboratoriesChromaVision Medical

SystemsCipher SystemsClontech LaboratoriesCorningDAKODNAStarDow CorningDynal BiotecheBIOINFORMATICSEdge BiosystemsEksigent TechnologiesEM Separations TechnologyEMD BiosciencesEntelechonEpigenomicsEpitomicsEpoch Biosciences

EppendorfEurogentecExpression PathologyFermentasFluidigmGE HealthcareGen-ProbeGene CodesGene LogicGene Therapy SystemsGentra SystemsGenVault CorporationGenzymeGuava TechnologiesHelicos BioSciencesHewlett-PackardHigh Throughput GenomicsHitachi InstrumentsHybrigenicsHyseqIBM Life SciencesIlluminaImmunotechInforMaxIntegrated DNA TechnologiesInvitrogenJRH BiosciencesKirkegaard & Perry

LaboratoriesKodak Scientific ImagingLeica MicrosystemsLI-CORLION bioscienceLonzaLuminexMDS SciexMettler-Toledo AutoChemMilliporeMiraiBioMolecular DevicesMWG BiotechNew England BiolabsNuGEN TechnologiesOvid TechnologiesPall Life SciencesPercival ScientificPerkinElmer Life SciencesPhotometrics

Plexagen DiagnosticsPost Genome InstitutePromegaProtein ForestProteome SystemsQbiogeneQIAGENR & D SystemsRibomed BiotechnologiesRosetta BiosoftwareSachemSarstedtSandia National LaboratoriesSAS InstituteSchott NexterionSequenomSerologicalsSerotecSigma-AldrichSolexaSomaLogicSource Precision MedicineStratagene Stressgen BiotechnologiesTakara Mirus BioTecanThe Jackson LaboratoryThermo Fisher ScientificThomas ScientificTocris CooksonTransgenomicUVPVarianVWR InternationalVysisWatersWhatman

Medical DiagnosticsApplied ImagingCiba Corning DiagnosticsDade BehringDiagnostic Products Diametrics MedicalHewlett-Packard Medical

ProductsLifeScanMallinckrodt

Ortho-Clinical DiagnosticsRadiometer AmericaTektronix

PharmaceuticalsAbbott LaboratoriesAmgenAstraZenecaAventisBaxter HealthcareBayer Boehringer Ingelheim

PharmaceuticalsCardinal HealthCentocorHoechst Marion RousselICN PharmaceuticalsJanssen PharmaceuticaMerckNovartis PharmaceuticalsNovo Nordisk

PharmaceuticalsPfizerSchering-Plough

Professional Services & FinanceAdjuvant PartnersAdventus ResearchAgency.comAnvil GroupAtlas VentureBattelle Memorial InstituteBioOnlineCitadel Investment GroupDoran Media ServicesFidelity Management and

ResearchFoley & LardnerGerson Lehrman GroupHSBC SecuritiesInfotrieveInnovative Marketing GroupMcKinsey & Co.Nathan AssociatesNational Research Council of

CanadaNovintel

Phillip Johnson & AssociatesPA ConsultingPerry BallardPiper JaffrayRuder FinnScherago InternationalSelect Equity GroupStephan & BradyThe Strategy WorksUBS Warburg

Publishers & Associations Academic PressAmerican Academy of

PediatricsAAAS/ScienceAmerican Medical AssociationAmerican Society for Cell

BiologyAmerican Society for

MicrobiologyAmerican Society of Human

GeneticsBioTechniques/Eaton

PublishingBlackwell PublishingCold Spring Harbor

Laboratory PressElsevier Federation of Amer. Societies

for Experimental BiologyHarvard University Medical

SchoolJohn Wiley & SonsMary Ann Liebert PublishersNature Publishing GroupNew England Journal of

MedicineSociety for NeuroscienceSpringer-VerlagStanford University High Wire

PressThomson ISIWolters Kluwer

Our Valued Clients



REPORT #09-001 Prospering in a Down Market: Strategies for Life Science Suppliers

PRE-PUBLICATION DISCOUNT PRICES are only available until March 15, 2009!Print Copy—$3,200 Now $2,700!Electronic Copy (includes one print copy)—$5,200 Now $4,500!Enterprise Copy (includes one print copy)—$7,940 Now $6,750!

I wish to order the following format of REPORT #09-001, Prospering in a Down Market: Strategies for Life Science Suppliers Discount Price

o Print Copy $2,700 $________

o Electronic Copy (.pdf, includes print copy) $4,500 $________

o Enterprise Copy (.pdf, includes print copy) $6,750 $________

o Add Data Set Excel or SPSS (circle one) +$1,200 +$________

Additional print copies _____ x $300 each +$________

Promo Code ___________ –$________ Shipping & Handling (Add $15 for U.S., $50 for Int’l) +$________

Total $________

Name

Title

Organization

Street Address

City, State/Province, Postal Code

Country

Phone Fax

Email

o Check Enclosed (Payable to BioInformatics, LLC)

o Purchase Order # ________________________________________

o Bill Me

o Am Ex o MasterCard o Visa o Diner’s Card o Discover

/Credit Card # Exp Date (MM/YY)

Name on card _____________________________________________

Order Authorized By:

__________________________________________________________ Signature Date

To place an order, fill out this form and mail it to BioInformatics, LLC or fax it to 703.778.3081. Alternatively, you may submit your order by emailing [email protected], calling 703.778.3080 or visiting www.gene2drug.com/order/200/.

Payment must be made within 30 days and in U.S. dollars. BioInformatics’ Federal Tax ID #: 54-2001907.

Credit CardYou may charge your order to American Express, MasterCard, Visa, Diner’s Card or Discover. Please include your credit card account number, expiration date and signature.

Wire TransfersWire transfers should be sent to: SunTrust Bank, 2121 15th Street, Arlington, VA 22201, SWIFT #SNTRUS3A, ABA #071000104, Account #702260169.

Electronic CopyThis format allows an unlimited number of users within your company to access the report regardless of geographic location. You may place the electronic copy (PDF) on your secure, corporate intranet or share it with co-workers via email. In addition to providing greater accessibility, the electronic copy allows you to easily navigate the document with the help of bookmarks, quickly search key words or phrases and print out any page. One print copy of the report is also provided at no additional cost.

Data SetTo accommodate your unique needs, the raw data is also available. With the data, you can analyze respondents’ answer choices in any way needed, including cross-tabulations, correlations, etc. The data set is offered in two formats: SPSS® Base or Microsoft® Excel, and may only be purchased in conjunction with the company-wide electronic copy of the report.

Ordering Information

BioInformatics, LLC 2111 Wilson Blvd., Suite 250 Arlington, VA 22201

Web: www.gene2drug.com • Phone: 703.778.3080 x13 • Fax: 703.778.3081 • Email: [email protected]

BioInformaticsmarket insights from gene to drug

http://www.gene2drug.com/order/200/

http://www.gene2drug.com

mailto:[email protected]

Health & Medicine

Prospering in a Down Market: Strategies for Life Science Suppliers