The biotech business model has become unsustainable in the current financial crisis, according to an annual report on the industry issued this week by Ernst & Young.

The report, titled Beyond Borders, describes an industry that in many ways is in a free fall. Worldwide, 162 publicly traded biotech companies — nearly half the total — have less than a year’s worth of cash on hand. And while various pockets of the industry have always had their ups and downs, this time Ernst & Young described this downturn as “systemic.”

San Diego’s biotech industry has fared no better than the overall industry, according to the report. The number of publicly traded companies in San Diego dropped by 9 percent to 40, and the cumulative value of those companies plummeted 26 percent. The lone bright spot was the cumulative revenues of local biotechs, which was up 15 percent.

Here is a company-by-company breakdown of local biotech balance sheets courtesy of Xconomy.

The report mirrored what many local biotech leaders have been saying since the financial crisis hit last year. In recent months I have written about the virtual biotech company, how biotechs are less-likely to bank on the homerun drug and the precipitous drop in venture capital funding.

DAVID WASHBURN

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