Dolly the sheep produces a rare protein in its milk which is used to treat cystic fibrosis. Celltech's leukemia treat- ment is in the late stages of trials. "Both drugs offer advantages and the clinical data look compelling," said Mr Woolf.However, drugs can and do fail at the last hurdle. Even so, the FDA has yet to be convinced of its superiority over a generic competitor. One exception was Phytopharm whose shares rose 260 per cent last year following a licensing agreement with Pfizer for its appetite suppressant.No British biotech company has yet to bring a compound to market, let alone emulated Amgen's success. Nevertheless, Celltech and Chiroscience are expected to obtain approval for their first drugs shortly. In the US, biotech companies have brought 20 drugs to market.

In fact, Chiroscience obtained Food and Drugs Administration approval last month for Chirocaine, a long-lasting local anaesthetic. Aside from British Biotech, several companies have suffered well-publicised setbacks in clinical trials including Biocompatibles, Celltech and Scotia Holdings. That is normal for the pharmaceutical industry, but these relatively small companies do not have the giants' large cash flow and wide range of drug prospects.Few have pleased investors. Of the 30 quoted biotech firms, six appointed new chief executives last year, further reducing confidence in the market. Its full impact may, however, take longer to occur than many people expect."There is a great deal of time for biotech start-ups to disappoint investors. Management problems seem to have been endemic, and profligacy not unknown. Dr Newman at Cranfield warned: "A lot of time and money has been invested in genomics This has already solved some problems.

British Biotech hyped up its cancer treatment to such an extent that its head of clinical trials, Dr Andrew Millar, protested and was sacked for his pains. The resignation of the over-enthusiastic chief executive, Keith McCullagh, followed. Last week's poor clinical results seemed both to vindicate Dr Millar and to call into question the realism of the industry.Bringing the latest science to market is arduous and costly. In this all-or-nothing business, many directors prefer to dream aloud about future billions rather than talk about nothing. "But we are still seeking good-quality firms with well-conceived business plans and good technology."Only one in 10 drugs entering clinical trials receives regulatory approval. Meanwhile, the sector is chock-a-block with loss-makers which have heavily under-performed.