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ASM International Conference - Global and Local Biotechnology Industry

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  • APAC here includes India
  • . In 1976, Swanson and Boyer founded Genentech in California
  • In the northern part of Taiwan, the Taipei area, specifically the NangGang Biotech Plaza, has 2 incubation centers: the Biotech IncubationCenter, Small and Medium Enterprise Administration, MOEA and the Incubation Center, Genomic Research Center, Academia Sinica. More than 50 biotech companies are located here, thereby making it a biotech clusterHsinchu county is the home to Taiwan’s first science-based industrial park, set up to help the development of high-tech industries. A newBiomedical Science Park is underway and will be managed by the Hsinchu Science Park Administration Office.
  • Transcript

    • 1. The Global and Local Biotechnology Industry
      ASMIC, June 2010
      • © 2010 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the prior written approval and consent of Frost & Sullivan.
    • “Sometimes people ask me what field I'd be in if not computers. I think I'd be working in biotechnology”
      Bill Gates New York Times, June 18, 1996
    • 2. AGENDA
      Global Biotechnology Overview
      1
      Benchmarking successful biotechnology clusters
      2
      Malaysia in the context of biotechnology
      3
    • 3. Global Industry Profile The development of a global market and emergence of new players will drive growth in the market
      The Driving factors for Global Biotech growth
      Beyond Geographic Borders
      Pricing Pressure & Asia’s emergence leads to global extension of companies
      Beyond Industry Borders
      Agricultural & Industrial Biotechnology approach critical mass
      Beyond Product Borders
      Monoclonal Antibodies & Personalized medicines bring new applications of drugs to the market
      Proprietary/
      Innovation
      High Margin
      Stage of development:
      • Countries in Asia exist across the entire biotechnology value chain
      • 4. Japan has long held a global position of strength in the biotechnology market and is a world leader in segments of the market (e.g: food processing)
      JAPAN
      US & EU
      TAIWAN
      AUSTRALIA
      CHINA
      NEW ZEALAND
      MALAYSIA
      Time
      Commodity
      Low Margin
      Source: Frost & Sullivan, DataMonitor
    • 5. Global Biotechnology Industry Overview: 2009
      Global Biotechnology Revenue by Sectors
      26.00%
      62%
      12%
      Healthcare
      Agriculture
      Others, Inc Industrial
      HC: Will continue to be >50% of the market
      Breakdown by Sector
    • 6. Scientific American WorldviewA global biotechnology survey, 2010
      • INTENSITY measurement—defined by indicators such as public companies per capita and portion of overall R&D spending used for biotech—balances some of the size-related differences between countries
      • 7. This survey aims to find how well various countries are doing in Biotechnology
      Source: Scientific American World View
      http://www.saworldview.com/article/a-global-biotechnology-survey---worldview-scorecard--
    • 8. Dynamics of the Biotech Industry in APAC . . . Valued at USD 50 million
      Japan
      • The Japanese government, which was earlier accused of shielding its domestic companies, has now opened its doors for foreign investment
      China
      • Opaque government policies and regulations in China are acting as a major hurdle for foreign participation in the biotech market
      • 9. China’s health biotech segment had maintained an annual growth rate of 30% since 2005. Biopharmaceutical production rose from US$860 million in 2000 to US$4.2 billion in 2005, and is forecast to exceed US$12.5 billion in 2015
      • 10. Venture capitalists committed US$337 million to Chinese life sciences projects during 2008.
      South Korea
      • The South Korean Ministry of Science and Technology (MOST) plans to make South Korea the seventh most developed country by 2010 in biotechnology
      Taiwan
      • The government expects that the local biotech industry will support 500 biotech companies by the end of 2010 and transform Taiwan into a Green Silicon Island
      India
      • India has an emerging biotechnology industry that is aided by a large highly-educated community of scientists and researchers. The country's biotechnology industry also boasts of strong government support and a growing infrastructure base
      • 11. The Contract Research industry in India could reach as high as US$ 270 million by 2009
      • 12. Indian biotech sector could reachUS$5 billion by 2010
      • 13. Biopharmaceutical segment has more than 40% of the 325 biotech companies in India
      Malaysia
      • Malaysia has strong government support and capital injection to boost its biotech industry. Focus is on technology transfer and key areas of agriculture, healthcare and industrial biotechnology
      Australia
      • Australia's strengths in biotech research include agricultural and medical research in general, but particularly immunology and vaccines, stem cells, proteomics, and bioinformatics
      Singapore
      • Singapore has strong government support and capital injection to boost its biotech industry. Made strides in biomedical research
      Source: http://bharatbook.com; www.frost.com
    • 14. AGENDA
      Global Biotechnology Overview
      1
      Benchmarking successful biotechnology clusters
      2
      Malaysia in the context of biotechnology
      3
    • 15. Examples of strong biotech clusters
      Medicon Valley
      • Zealand in Denmark and Scania in South Sweden
      Boston/ Massachusetts
      • Greater Boston Area including Providence and Worcester
      South Korea
      • Across the country
      California
      • San Francisco Bay Area in North California
      • 16. Los Angeles, Orange County, Riverside and San Diego in South California
      Taiwan
      • Medical Technology
      Singapore
    • 17. The Magic of Boston and California ClustersStrong science base. Established institutions, Funds from government and VC, strong industry associations and a spirit of entrepreneurship make them sustainable clusters
      Strong Science Base
      Funding Availability
      Business Environment for Biotech
      • 30+ years of history in Biotech
      • 18. 100+ years of successful research at MIT, Harvard, Stanford, UCSF
      • 19. Efficient TLO and networks to drive commercialization
      • 20. Spin offs from successful companies
      • 21. Clarity in IP transfer
      • 22. Leading Medical Institutions in the area
      • 23. NIH funds of $ 2bn + annually
      • 24. VC funds of $ 1bn + annually
      • 25. IPO markets, Angel community and a culture to promote entrepreneurship and risk taking
      • 26. $80mn+ funding for small businesses
      • 27. Intellectual environment attract staff and companies
      • 28. Continuous supply of educated workers
      • 29. Industry Associations to continuously monitor and provide feedback
      • 30. State’s drive to attract companies
      • 31. Presence of three generation of entrepreneurs
      Key Capabilities
      • Boston and California face competition from Texas, Los Angeles, Philadelphia for funds. Companies locating manufacturing facilities elsewhere for low real estate costs, higher tax benefits etc.
      • 32. Continuous need to Provide space, talent, funds for the expanding cluster
      • 33. Needs to continue focus on scientific collaboration and innovation
      • 34. Emerging clusters pose competition due to low cost, high growth potential for companies
      Key Issues
    • 35. The Growth of Korea Educated and experienced manpower, success in research and clinical trials and the biomedical infrastructure created by the government are the key reasons for growth
      Strong Science Base
      Business Environment for Biotech
      • Biotechnology-related Departments in 40 Universities
      • 36. Strong in clinical trials
      • 37. High quality of workforce
      • 38. Around 40 technologies or drug candidates were licensed out to Big Pharma during 1986-2008 and over 100 new drugs or lead candidates are under development.
      • 39. Govt. creating research institutes, 25 biotechnology centers acting as incubators, specialized biotech parks, providing funds
      • 40. The first initiative started in late 1980’s, continued effort in 1994 and 2006
      • 41. government investments have grown from $311mn in 2001 to $721mn in 2007. This represents a CAGR of 15%.
      • 42. Korea is ranked as 19 by WF Global Competitiveness Report 2009-10
      • 43. The Bio-Vision initiative started in 2006 out with a budget of $720 million for R&D and $230 million for infrastructure in 2007, with a projected rise to $1.67 billion for R&D and $690 million for infrastructure by 2016. The total budget for nine years is projected at $15.56 billion
      Key Capabilities
      • Pharmaceutical companies do not have strong experience to enter global markets
      • 44. Difficulty to source foreign talent
      • 45. Collaboration needs to improve among universities and industries. Between companies in the clusters
      • 46. Pharmaceutical industry is mostly generics
      Key Issues
    • 47. Taiwan Clusters
      • 17TH IN World, 1st in Asia Knowledge Economy Development by WB (2008)
      • 48. 6th in World, 2nd in Asia Innovation Ranking by EIU (2007-11)
      • 49. 17TH IN World, 5th in Asia Global Competitiveness Index (2008-09)
      • 50. 1st Industry Cluster Development Global Competitiveness Index , WEF 2006-09
      Source:, Ministry of Economic Affairs Taiwan, 2009
    • 51. AGENDA
      Global Biotechnology Overview
      1
      Benchmarking successful biotechnology clusters
      2
      Malaysia in the context of biotechnology
      3
    • 52. Availability of Research grants and Govt support
      Lack of financial loans from financial institutions
      Cost-competitive labor
      Structural and background as manufacturing country
      Rich biodiversity
      Cost effective leading to potentially higher profit margins
      Time to build technology background
      RESTRAINTS
      DRIVERS
      Market demand as acceptability of biotech in all areas increases
      Insufficient funding
      Good infrastructure, good transportation network
      Human resource
      National Biotechnology Policy
      BioNexus Status
      Malaysia’s Biotechnology Industry:Overall Market Drivers and Restraints
    • 53. Comparative Analysis
      • Lack of compiled data for the clusters and across the same areas and similar year make quantitative comparison difficult
      Source: Frost & Sullivan Analysis
    • 54. Key Attributes of Successful Biotech Clusters. . . . Priorities for Malaysia
      Industry Maturity
      University/Medical Centre Maturity
      • Presence and nature of biotech companies (e.g. Startup, early stage, late development, mature commercial, enabling service)
      • 55. Quantity and diversity of lifesciences stakeholders (e.g. R&D, medical devices, clinical trials and manufacturing, supporting industries)
      • 56. Growth in Output – stagnated growth, slow growth or faster than industry
      • 57. Strong research universities and academic medical centers, supported by effective technology transfer offices, as a key source of innovation and talent
      • 58. Collaborative relationships between research universities and academic medical centers to sustain invention and innovation
      • 59. Areas of Research and Commercialization Success
      Funding Availability
      Regulatory and Business Environment
      • Availability of funding to support early stage company research
      • 60. Funding for established biotech companies to invest in additional infrastructure and clinical research to move products into the market place
      • 61. Public and Private funding channels
      • 62. Stable and supportive public policy structure
      • 63. Supportive business environment to retain existing companies and / or attract new enterprises (e.g., taxes, permitting, costs, IP protection)
      • 64. Stakeholder Synergy
      • 65. Industry Maturity and University/Medical Centre maturity comprises Company and Science Base
      • 66. Funding Availability Remains Same
      • 67. Regulatory and Business Environment comprises other seven factors
      Source: Frost & Sullivan analysis
    • 68. Setting the stage…
      1
      Industry Maturity, Medical Centre and University Maturity, Funding Availability and Regulatory and Business Environment are four key attributes of a strong biotechnology cluster
      2
      Malaysia is at the starting point of biotechnology innovation . . . . We don’t have a history and need to progress on each attribute . . Starting from our education system and public awareness
      3
      To improve Industry Maturity– we need to focus on medical devices, commercialisable research, historically strong technologies
      4
      To improve University and Medical Centre maturity - collaboration activities, TTOs and incubators, More commercial exposure to scientists and international tie-ups are needed
      5
      Promotion of SMEs, Improving skill base and promoting entrepreneurship are desirable to improve the business environment in the overall industry
      6
      Pre seed funding and steps to develop VC need to be taken to improve funding availability for companies
    • 69. Proactive commercialization in Research and Academic Centers – Learning from Yale University
      Technology Transfer at Yale University
      Impact
      • High support–high selectivity policies needed for entrepreneurially underdeveloped environments
      • 70. Provided facilities like creation of business plan, providing mentoring support, promotion of success stories, having entrepreneurial courses in curriculum, incentives for starting up, getting entrepreneurs to set up in the region and chasing VCs
      • 71. Gregory Gardiner, a former Pfizer executive took charge of Office of Cooperative Research in 1982
      • 72. An important goal for the Yale OCR was to identify new ideas, cultivate venture funding for them, and facilitate their development into companies that become part of the New Haven economy.
      • 73. Increased exposure of researchers to commercial ideas
      • 74. The renewed OCR established direct contacts with venture capital firms. The goal was not only to persuade venture capital firms of the relevance of university technology but also to convince them to create ventures in New Haven
      • 75. Only six biotech companies in 1993
      • 76. The hard work of seeking appropriate investors eventually paid off, and in 1998, after two years of effort, the first round of financing was concluded with $20 million for five companies.
      • 77. Today the Connecticut cluster employs 17,985 people directly and 35,857 through indirect and induced employment. It consists of 49 biotechnology companies. Five of the biotech companies are publicly traded: Alexion Pharmaceuticals, Neurogen, Curagen, Gennesiance, and Vion Pharmaceuticals. Of the biotech companies, 24 companies, or 49%, of the biotechnology cluster in New Haven were created after 1996 with technology, ideas, or founders from Yale and with the help of the OCR.
      Source: University Commercialization Strategies in the Development of Regional Bioclusters , Shiri M. Breznitz, Rory P. O’Shea, and Thomas J. Allen published in Journal of Product Innovation Management 2008
    • 78. THANK YOU
      Rhenu BhullerVP, BiotechnologyFrost & Sullivan Internationalrbhuller@frost.com