Running a lab is not cheap. Experts estimate that operational costs can range anywhere from $10,000 to $40,000 per day to run a biotech and as much as $100,000 per day for some pharmaceuticals. A huge component of these costs are lab supplies, specifically the preclinical R&D lab supply space with a market size of around $60 billion. Our recent Q3 2021 analysis of customer data identified three key insights into the life sciences procurement process that can be used to achieve significant savings.
- Labs are extremely expensive to operate, so pursuing savings should always be a priority, even in times of supply chain instability. In the first nine months of 2021, a ZAGENO customer spent $1.2 million in lab supplies, but was able to save $240,000, or 19%, using ZAGENO’s self-service eMarketplace to procure supplies. Their biggest savings came from two product categories: pipette tips and primary antibodies. So, while today’s supply chain challenges are causing businesses to pay a premium for product availability, it is more important than ever to swiftly compare prices and make an educated decision before purchasing.
- Whether negotiating prices through a group, subscribing to a service like ZAGENO or a combination of both, there are instant savings opportunities available for commonly used products. In life sciences, pricing has long been closely guarded information controlled by the seller, with varying list prices, markups, and discounts. The ZAGENO study showed that 73% of savings were achieved simply by using the marketplace to compare product list prices across suppliers before purchasing. ZAGENO’s subscription-based service provides price transparency and lifts the curtain on pricing models, while also offering customers the ability to maintain their own previously negotiated discounts with suppliers.
- Substantial savings can be reinvested into the business to increase lab efficiency, avoid experiment delays, and reduce time to market. Many early-stage companies are not yet seeing revenue or earnings, so savings is real money that can be used to strengthen the business. For example, $240,000 in savings can be used to hire additional full-time scientists, buy more supplies, undertake additional experiments, or look at other indications or other medicines in which to invest.
“Requests coming from scientists have not changed, they are looking for availability, quality, and speed. Yet the technology is evolving and now we know that we can look into solutions like ZAGENO for quick turnaround of the products and still realize savings”, shared Marc Casals, Head of R&D Procurement for UCB Pharma. With supply chain disruptions promising to get worse before getting better, the R&D procurement process must incorporate available tools to gain much needed price transparency while also managing tens of thousands of necessary SKUs.