Lungile Shoba-Zikhali presented on industrial biotechnologies and the Technology Innovation Agency's (TIA) role in supporting their development in South Africa. The presentation discussed (1) the challenges of bridging the innovation chasm; (2) TIA's mandate to stimulate technological innovation; (3) TIA's focus on high-risk projects along the innovation value chain through partnerships; and (4) examples of TIA's investments in industrial biotechnology subsectors like bioenergy, bioremediation, and biomaterials. The goal is to support environmentally friendly and sustainable production that creates jobs and economic benefits for South Africa.

1. Industrial Biotechnologies
For Climate Change
COP 17
Lungile Shoba-Zikhali
(GM – Industrial Biotechnology)

2. Technology Innovation Agency (TIA)
TIA VISION
www.akasan.com.tr/resimler/vision-mission-big.jpg
…A world class innovation agency that supports and enables
technological innovation to achieve socio-economic benefits for South
Africa through leveraging strategic partnerships.
06 Dec 2011 Lungile Shoba-Zikhali 2

3. Formation of the TIA
06 Dec 2011 Lungile Shoba-Zikhali 3

4. The Innovation chasm challenge
OVERSEAS TECHNOLOGY SOURCES
Research Development Production
Large balance of
payment
IP Lost
Innovation Local Industry
Local
Knowledge “Chasm”
Research Development Manufacturing
06 Dec 2011 Lungile Shoba-Zikhali 4

5. The innovation chasm- the strategic
challenge continued
COMMERCIAL
THE
INDUSTRIES AND
IDEAS, RESEARC
MANUFACTURING
H AND
DEVELOPMENT
06 Dec 2011 Lungile Shoba-Zikhali 5
VALLEY OF DEATH

6. TIA: Bridging the innovation chasm
TIA
COMMERCIAL
THE IDEAS, INDUSTRIALISTRIES
RESEARCH AND AND
DEVELOPMENT MANUFACTURING
06 Dec 2011 Lungile Shoba-Zikhali 6

7. The TIA Mandate
MANDATE:
“…to support the State in stimulating and intensifying technological
innovation in order to improve economic growth and the quality of life
of all South Africans by „supporting & facilitating‟ the development and
exploitation of technological innovations”
The TIA Act [No 26 of 2008]
06 Dec 2011 Lungile Shoba-Zikhali 7

8. TIA Funding Focus
TIA geared towards addressing “market failure”
and building bridges and institutional linkages
along the innovation value chain:
Private
Equity
High Risk/
Uncertain Return
Low Risk/
High Return
IP Value
TIA Funding Focus Partnerships
Partnerships (e.g. IDC, NEF)
(e.g. NRF)
PPP‟s
CoCs
Basic Research Applied Research Tech Development Manufacturing
The TIA focuses its financial and non-financial offerings along the innovation chasm, and
operates with the required flexibility across the innovation value chain through mobilising
and leveraging national, regional and international partnerships
06 Dec 2011 Lungile Shoba-Zikhali 8

9. TIA Sectors
TIA SECTORS
Biotechnology Industrial
Sectors Sectors
Industrial Advanced
Agro Health Biotechnology Mining Energy Manufacturing ICT …Other
… Fund Management; Expert Services; IP; Finance; PPM&E…
06 Dec 2011 Lungile Shoba-Zikhali 9

10. Industrial Biotechnology (IB)
INDUSTRIAL
BIOTECHNOLOGY
Source:http://www.istockphoto.com/file_thumbview_approve/8453530/2/istockphoto_8453530-green-biofuel.jpg
Working definition:
“the application of biotechnology for the environmentally friendly
production of products and processing of chemicals, pharmaceuticals,
materials and bio-energy”.
(OECD Workshop on “Outlook on Industrial Biotechnology”. Discussion paper –Session II “Industry Structure and Business Models for Industrial Biotechnology”. 13-15 Jan 2010)
06 Dec 2011 Lungile Shoba-Zikhali 10

11. Industrial Biotechnology (IB)
• Provides an opportunity to develop a sustainable, bio-based economy that uses
eco-efficient bio-processes and renewable bio-resources.
• Focuses on development of processes and production systems that:
- save costs and are more profitable since they do not waste material
-enable greater and more efficient utilization of renewable resources.
• Products that are:
-better performing, more durable and don’t persist after their useful life
-less toxic, more easily recyclable and biodegradable
-are derived from renewable resources
-contribute minimally to net greenhouse gas emission
06 Dec 2011 Lungile Shoba-Zikhali 11

12. Why Industrial Biotechnology?
…Greening the SA economy for sustainable industrial
development
Drivers
• Knowledge-based quality jobs …to achieve the „Triple Bottom Line‟
• Social responsibility
Hurdles
…3Ps of Sustainability
• Unawareness
• Acceptance
SUSTAINABILITY
Drivers
• Cost reduction Drivers
• Novel products • Less energy
Hurdles • Less waste
• Regulations - i.e. Cleaner production
• Further technology development Hurdles
• Feedstock prices • Further technology development
• Investments • Waste management
06 Dec 2011 Lungile Shoba-Zikhali 12

13. Industrial Biotech
Cross-Cutting Technology Sector
06 Dec 2011 Lungile Shoba-Zikhali 13

14. Application of IB
IB = cross-cutting „technology sector‟ e.g. Sectors where
IB plays a roles
Pharmaceutical
…applies biotechnologies (microbial, plant and animal) for:
Agriculture
1. processing and Energy
2. production of: Food & Beverage
Chemicals
 (Bio) Chemicals
Pulp & Paper
 (Bio) Materials
Plastics
 (Bio) Energy
Mining
across a diverse range of industry/economic sectors: Textiles
06 Dec 2011 Lungile Shoba-Zikhali 14

15. IB Value Chain
06 Dec 2011 Lungile Shoba-Zikhali 15

16. IB Sub-Sector Focus Areas
06 Dec 2011 Lungile Shoba-Zikhali 16

17. IB Sector Unit Objectives
1. Stimulate and support the development of industrial biotechnology-
based innovations for the environmentally friendly processing and
production of chemicals, materials and energy
2. Stimulate and support the development of industrial biotechnology-
based private and/or public enterprises
3. Leverage the TIA funds for co-investment into industrial biotechnology-
based innovations
06 Dec 2011 Lungile Shoba-Zikhali 17

18. IB Sector Unit Objectives
4. Facilitate the development of human capital for technology innovation
within industrial biotechnology investments to ensure sufficient firm and/or
industry absorptive capacity* for new technologies
5. Promote and support activities and events that facilitate the building of a
culture of technology innovation and entrepreneurship
*“ability to recognize the value of a new „technology‟, assimilate it, and apply it to commercial ends” Cohen and Levinthal
(1990), "Absorptive capacity: A new perspective on learning and innovation", Administrative Science Quarterly, Volume 35, Issue 1 pg.
128-152.
06 Dec 2011 Lungile Shoba-Zikhali 18

19. IB Sub-sectors
1. BioChemicals:
Products/processes with superior cost/performance ratio, e.g. enzymes in
bioprocesses
2. BioMaterials:
Production of eco-efficient materials e.g. biodegradable
3. BioEnergy:
Technologies for efficient conversion of biomass feedstock for energy production
4. BioRemediation:
Technologies for effective & cost-efficient treatment and recycling of wastewater
for improved water quality and reduced pollution/toxicity
5. BioMinerals:
Technologies for efficient & cost-effective bio-leaching/mining processes for
extracting mineral resources
06 Dec 2011 Lungile Shoba-Zikhali 19

20. Expected Outcomes & Impact
of IB Innovation in SA
OUTCOMES IMPACT
Increased application of biotechnology Enhanced competitiveness of industries
1 in the process steps for the production of Eco-efficient use of the renewable raw
chemicals and materials materials
Increased use of renewable resources
2 Sustainable industries less reliant on limited
as raw materials for industrial applications
Increased application of biotechnology fossil fuels
3 in the manufacture of products across Economically & environmentally sustainable
various industries manufacture of products
Increased production of biomass- SA’s dependency on fossil fuels reduced
4 derived energy based on biotechnology SA’s import of fuels reduced
for everyday consumption Meaningful job creation
Increased rural development that
Improved standards of living for all SAs
5 contributes to the supply of raw renewable
materials Reduced waste generation
Reduced production of greenhouse gases
Increased cooperation, collaboration Increased contribution to the national GDP
6 and support between researchers,
Enhanced global competitiveness of South
industry, government & civil society
African firms & industries
06 Dec 2011 Lungile Shoba-Zikhali 20

21. Distribution by Focus Area
35 All
Current
30
Completed
25
Pipeline
20
15
10
5
0
Biochemicals Biomaterials Bioenergy Bioremediation Other
06 Dec 2011 Lungile Shoba-Zikhali 21

22. Examples of TIA IB Investments
Production of anti-bodies in plant systems for the
1. Rabivir Green Pharm
development of therapeutics & diagnostics
2. AzarGen Production of high value therapeutic peptides in plants
Development & optimisation of a fermentation technology for
3. FemTech
the production of human recombinant proteins
Development & optimization of a recombinant technology for
4. Halodurans
the production of therapeutic peptides.
5. Enzyme Technologies Production of bromelain enzyme from pineapples
Commercialisation of locally produced enzymes and
6. ZA Biotech
proprietary enzyme immobilisation technologies
7. Lactase Enzyme Development of a fermentation bioprocess technology for
(SLIEK) lactase production
06 Dec 2011 Lungile Shoba-Zikhali 22

23. Examples of TIA IB Investments
Explore & characterize SA’s algal biodiversity and development
8. Algal Bioprospecting a collection and database of algal strains for the production of
biofuels
Screening & classifying (database) fungi culture collections for
9. Indigenous Fungi
value adding products
Validation of initial techno-economics of EPA/Omega 3
10. Algal Omega 3
production by SA's algal strains
Validation of technology for fish waste beneficiation (omega 3 oil
11. OM3 Oils
extraction)
12. Food and Cosmetic
Development of novel formulation of low glycemic index sugar
Technologies
Development of technology for the neutralisation of acid mine
13. Acid Mine Drainage water and the biological removal of sulphate using sulphate
06 Dec 2011 reducing bacteriaShoba-Zikhali
Lungile 23

24. Stage in the Innovation & Funding Value Chain
Phase 1 Phase 2 Phase 3 Phase 4
Early Expansion
Seed Start-up Expansion
Technical
Product & Business start
Basic Idea Proof of development/ Business
business up
Research Generation Concept commercial growth
development (tech based)
planning
AzarGen RabiVir Femtech
Halodurans
Enzyme
ZA Biotech
Technologies
Lactase Enzyme
(SLIEK)
Algal
Bioprospecting
Indigenous
Fungi
Algal Food & Cosmetic
Omega-3 OM3 Oils Technologies
Acid Mine
Drainage
06 Dec 2011 Lungile Shoba-Zikhali 24
DoE, NRF, DST TIA Support IDC , NEF

25. What the IB Sector Unit is looking for
in Opportunities
1. Technology Innovation opportunity – Science-based product/process/service
offering with strong potential for market capitalisation
2. Strong alignment with the TIA mandate, Corporate and Sector Strategic objectives
3. Stage of technology development is beyond basic research (validated post-proof
of concept)
4. Potential for high socio-economic impact – addresses national imperatives e.g.
job creation
5. Strong potential to enhance industry competitiveness
6. Presence of an industry commercialisation partner where relevant
7. Co-Investment opportunity presented to allow risk-sharing
06 Dec 2011 Lungile Shoba-Zikhali 25

26. Thank you
www.tia.org.za
06 Dec 2011 Lungile Shoba-Zikhali 26