By Karen Bernstein

As long as biotech companies are in the business of developing new drugs, they will be no strangers to product failures. The question is not whether drugs will fail, but how management saves a company when a drug fails and to what extent failure can be anticipated and planned for.

The highly publicized FDA rejection of Centocor Inc.'s anti-sepsis monoclonal forced the company last April to rethink its strategic plan, and last week's news that the latest Phase III trial was suspended raised questions about whether CNTO can follow through on its new partnering strategy. HA-1A is the story of a strategy built on the presumption of success of a single product, whose mounting failures have affected the entire structure of the company.

BioCentury talked to executives at several companies who have devised strategies designed to avoid this kind of cataclysmic event, as well as managers at companies that more closely fit the biotech pattern of betting on a core technology.

Choices, choices, choices

From the managers' point of view, the key is to have choices: a broad-based business, alternative technologies in case the lead one fails, or smaller products that can generate revenues if lead products develop more slowly than anticipated.