Tech • AI • Robotics
Understanding the Big Pharma system from the inside - Rafaèle Tordjman
5/10TL;DR
A physician-turned-investor is betting that European biotech can deliver the next wave of innovative medicines, even as development costs rise, pricing pressures intensify and major drugmakers face a looming $400 billion revenue cliff by 2033.
KEY POINTS
A patient-first investment strategy
Trained in hematology-oncology, Raphaël Torgeman built her career around severe diseases, especially blood cancers, before moving into science, investing and entrepreneurship. She says the guiding principle has remained unchanged: improving patient outcomes, including through innovative medicines for diseases that still lack effective treatment. Roughly one-third of known diseases still have no effective therapy.
From blood cancers to biotech finance
Hematology played a key role in the early therapeutic revolutions against cancer because blood and bone marrow are easier to analyze than many solid tumors. That accessibility helped drive earlier breakthroughs in targeted treatments for leukemias and lymphomas. The field showed how close links between clinical care and research can speed innovation.
Cancer remains the dominant challenge
Cancer is still described as a defining disease of the century, despite major advances in treatment. The central problem is no longer only whether cancer can be treated, but whether it can be cured durably. Blood cancers helped pioneer progress, but large unmet needs remain across both liquid and solid tumors, as well as in neurodegenerative, autoimmune and blinding diseases.
A new era of therapies
Older cancer treatment relied heavily on chemotherapy, which attacks cancer cells but also damages healthy tissue and can cause severe long-term complications. Over the past decades, medicine has shifted toward targeted therapies, immuno-oncology and cell therapy. One landmark example cited is Glivec, which transformed outcomes in chronic myeloid leukemia, while Keytruda became a symbol of the immunotherapy wave in solid tumors, including metastatic melanoma.
Drug development is long and expensive
Bringing a new drug to market now typically requires at least 10 years and about $2 billion. That cost reflects years of discovery, testing, clinical trials, regulatory review and commercialization risk. Unlike many technology startups that build a product and then search for a market, biotech companies usually begin with a known global market defined by patients suffering from a clearly identified disease.
Why big pharma keeps buying biotech
Large pharmaceutical groups increasingly rely on acquisitions because they have outsourced much of their research risk to smaller biotech companies. More than 70% of innovative medicines sold by Big Pharma now originate in smaller biotech and biopharma firms. Investors back those companies in the hope that a successful clinical program will be bought by a larger group with the scale to manufacture, market and distribute it.
A looming patent cliff
The acquisition race is being accelerated by expiring exclusivity on blockbuster drugs. By 2033, major pharmaceutical companies are expected to lose about $400 billion in annual revenue, equal on average to 25% of their yearly sales. That expected shortfall is pushing them to buy external innovation to refill pipelines and replace aging products.
The rise of a specialist fund
Torgeman created Jeito Capital, a healthcare investment firm launched in 2018, with its first fund deployed from 2020-2021. In roughly five years, the firm raised about $1.8 billion, or around €1.6 billion, to invest in biotech and biopharma companies. Its strategy is concentrated, typically backing 15 to 20 companies with long development horizons of roughly five to seven years.
Pricing and access are becoming a political question
Innovative medicines can produce dramatic gains for patients, but their prices are generating growing concern. Torgeman argues that societies must confront a difficult question: how long can health systems keep paying ever higher prices without creating a two-tier system in which only the wealthy can afford the best treatments. That risk is already visible in parts of the United States, where access can depend heavily on coverage and income.
Measuring value beyond returns
The financial case for biotech is tied directly to patient benefit, not only to market size. Beyond counting how many patients receive a drug, investors are increasingly trying to measure broader outcomes such as survival, return to work, reduced dependence and lower burden on families. The idea is that the true value of a medicine includes both its commercial performance and its social impact.
CONCLUSION
Biotech investing is becoming central to the future of medicine as large drugmakers depend more heavily on externally developed innovation. The next challenge is to ensure that breakthrough therapies remain both scientifically transformative and broadly affordable.
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