The First Bubble
From its origins in the mid-1980s, regenerative medicine was greeted with the kind of extreme excitement that has accompanied other potential breakthroughs, including monoclonal antibodies and RNA interference. By the year 2000, more than a decade after the first companies were formed, regenerative medicine companies were valued at over $2.6 billionii, TIME named tissue engineering one of the hottest jobs for the 21st century, and Barron’s predicted it would become a $100 billion industry. A few years later, the bubble had burst, and company valuations plummeted to a tenth of their year 2000-high.ii
Several factors contributed to these setbacks. First, like many new medical advances, expectations far exceeded reality. Investors and the media saw incredible promise in early research, and unrealistic timelines were set for when a product could be on the market. Second, the initial regenerative medicine products to reach the market had limited commercial success, as the few companies in the space had not yet understood all that was required to achieve both clinical and commercial success. From a scientific perspective, the field was poised to deliver, but it had not yet developed the regulatory, business, and commercial expertise required for long-term success.