Biotech has recently become very popular and more and more biotech startups are being set up and are almost securing better funding than most startups in other sectors and industries. The reason for this is that biotech is contributing to more than one field and is doing so in significant ways. Many people confuse biotech companies with pharmaceuticals, and while pharmaceutical companies might have a biotech division, biotech companies and their work go beyond medicine. Biotech has been used in medicine, consumer goods, drinks, and with a little more work, the provision of clean drinking water, possibly on a global scale.

There are also marked differences when it comes to money. Compared to pharmaceuticals, biotech companies operate on a very different business model and their financial priorities may not be as ambitious as pharmaceuticals.

This article will examine these differences in detail to bring you a better understanding of biotech companies.



Pharmaceuticals really only have one application, which is the research and production of medication for different ailments and illnesses. One cannot deny that pharmaceuticals most definitely have contributed to the medical wellbeing of humanity as a whole, but it is a fact that the applicability of pharmaceuticals is limited to the field of medicine.

Biotech companies are more diverse in their applicability and biotechnology is responsible for a range of different products. Beer, cheese, plastic bags, and detergents are just some examples of everyday consumables that are used around the world.


In fact, biotech has even been used to solve the clean water crisis that plagues many parts of the world. A lab in the United States has developed a process whereby living microorganisms, like bacteria, are used to treat sewage water to the point where it is drinkable. If the process is industrialized and introduced to developing countries, biotechnology could help solve one of the biggest crises to have ever affected humanity.

Despite having done so much, like treating sewage water and producing cancer treatment drugs, biotech companies continue to look for ways to improve our everyday lives and biotech R&D is trained in a way to follow this principle.



Coming back to the one common application between pharmaceuticals and biotech companies, the two are very different in their modes of operation. Pharmaceuticals use chemicals and synthetic compounds to produce medicine whereas biotech uses natural living microorganisms. Pharmaceuticals have slowly shifted their focus to marketing and production, whereas the main focus for biotech companies continues to be biotech research and development.



Pharmaceutical companies are notorious when it comes to their financial practices. The cost of production for medication tends to be quite low but retail prices tend to be incredibly high, in some cases a few thousand-fold! Biotech companies take a very different approach and regardless of the contributions they have made to society, commoditizing their efforts for mass production items does not seem to be a priority.

It is somewhat different when you use biotechnological resources for customized solutions. It’s also understandable that customized solutions would be expensive as a significant amount of man-hours, time, resources, and effort goes into providing such services. However, customized solutions are usually for industrial applications and the high cost is covered by the profits that such industries would make.