The best-worst scenario

Expect the worst, and the best won"t disappoint.

For the last couple of years the pharmaceutical sector in the developed world has adopted something of a seige mentality.

Faced with a massive and unpredicted hike in energy prices while trying to contend with fierce competition from the emerging low-cost economies in Asia, it is no wonder that we have seen an extended period of consolidation and retrenchment. Add to that thinner pipelines, a number of high profile drug withdrawals and overcapacity problems in some areas, and the majority of big pharma executives could be forgiven for reaching for the nearest bottles of antidepressants.

It was pleasantly surprising, therefore, that at Informex in San Francisco last month the mood was generally upbeat. The view of many of those I spoke to was that the worst had happened and they were still there. One company even reported that a number of projects that had been outsourced out to the Far East were coming back to the west, as the overall cost of the work turned out to be not as low as expected.

There was also healthy crop of investment announcements, heralding increases in capacity, technical capabilities, jobs and - eventually - profits.

It is not just the fittest that survive, but those who adapt to changing conditions and evolve to suit the new environment.