The National Center of the Middle Market (NCMM) conducted a survey from March 12-23, 2020 of 400 strategic decision makers from life sciences companies in the United States and Canada. The report noted middle market life sciences companies, which include companies with annual revenues between $10 million and $1 billion, have experienced robust growth. Between February 2019 and February 2020, collective growth of life sciences middle market companies was 6.9%, with an employment growth rate of 6.6%. Prior to COVID-19, life sciences companies predicted higher rates of revenue and employment for the year. However, the report highlights the challenges life sciences companies faced before and during the pandemic, which include an increasing competition, cyber threats, capital access, and business innovation, which most companies (23%) reported as their biggest challenge.
According to the report, 61% of fast growing companies cited changing technology as "very or extremely challenging." Another challenge reported by over half of the surveyed life sciences companies included supply chain disruption, leading to an inability to meet demand. Additionally, 46% of life sciences companies reported commercialization and distribution as significant challenges. Executives identify cybersecurity among risk management priorities as 52% of companies surveyed reported having experienced a cybersecurity breach. Other risk priorities include supply chain risk (10% identified as priority), legal and compliance risk (8%), and product pricing (7%).
In May 2020, the NCMM followed up with the surveyed companies to gauge the effects of the pandemic. Life sciences companies that are directly involved in fighting COVID-19 saw increased product demand. The survey identified a number of long-term effects and changes to the life sciences industry, including higher demand for personal hygiene products, increased telehealth services demand, industry consolidation, increased reliance on domestic suppliers for pharmaceutical ingredients, some efficacies in drug and vaccine development, and regulation easing in critical circumstances.
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