How will the economic crisis impact the drug discovery industry?

I feel that the effect the financial crisis has on drug development; health care and pharmaceuticals are relatively stable industries in crisis times - people need health care when they need it - you can't put off your heart attack like you can buying a new car or house. In that respect, the large pharma and biotech companies will probably still find meeting the challenge of generics and now biogenerics more challenging than the current financial crisis. The exception could be leveraged from the small and mid-level companies whose ability to debt finance their acquisitions has probably disappeared.

Yes Santosh is right, that the biotch and pharma industries are not hit as hard as other industries by economic crisis. But it doen't mean that it will not have impact on the industry because as other industries are affected there may be a decline in companies receiving funding to discover new drugs. If the companies will not receive funds then they will not be able to carry out the process of drug discovery.

According to me there is a good news that the financial crisis does not have an incremental effect on overall industry productivity (biotech + pharma). As compared to the performance of the NASDAQ biotechnology index to the performance of NASDAQ overall, it is seen that the biotechnology stocks haven't been hit nearly as hard as the overall market.