Research funding must boost commercialisation to secure Australia’s biotechnology industry
Posted : Wednesday, August 15, 2012
If the nation's globally focused biotechnology industry is to
thrive, Australian governments must secure existing programs to
promote commercialisation of research, an expert panel has told a
CEDA forum in Adelaide.
AusBiotech, CEO, Dr Anna Lavelle said few Australians realise
that the nation's biotechnology industry, including
biopharmaceuticals, was worth $32 billion with 350-400 companies
producing greater export income than the wine or auto-manufacturing
The forum heard that South Australia had a strong presence in
the biotechnology sector.
The panel described biotechnology companies as those that use
living organisms to produce products or processes to improve crops,
medical treatment or fuels.
Traditional biotechnology includes fermentation while new
biotechnology includes the use of gene technology for cancer
treatment, the panel said.
Bionomix, CEO, Dr Deborah Rathjen, said SA is the base for
Bionomix which produces small molecule pharmaceuticals with "block
buster potential" - sales of around $1 billion per annum.
The company has international partnerships and is producing new
drugs with fewer side-effects to treat anxiety and depression, and
treatments for metastatic renal cancer and breast cancer, she
The expert panel which also included industry representatives,
Headland Vision, Proprietor, Dr Meera Verma, GBS Venture Partners,
Partner, Dr Joshua Funder, and Biosensis, Director, Dr Leanna Read,
said greater policy focus was required to:
- Promote commercialisation of research and translation of
research into products;
- Secure continuity of existing industry programs;
- Remove obstacles to growing biotech companies such as stamp
duty on deals between biotech companies and withholding tax for
- Promote Australia as a destination for clinical trials, which
would drive better treatment and greater opportunities for
translation in the Australian health care system;
- Create industry sabbaticals for academics to allow them to
participate in translational or commercialisation projects while
maintaining their tenure and students;
- Promote superannuation fund investment in innovative companies
by leveraging government funding;
- Boost the Innovation Investment Fund from $100 million to $500
million per annum to successfully attract superannuation
funding in innovative industries; and
- Remove the moratorium on Genetically Modified crops in South
Dr Verma said that while the Australian biotechnology sector had
great opportunities for expansion, it was hindered by a number of
"Agricultural biotech is being strangled in SA because there is
an arbitrary holistic moratorium on GM crops. That indicates a lack
of understanding about the science behind it - a lack of interest
in challenging those ideas... We are the only state that has it -
even Tassie doesn't have it (the moratorium) any more," she
"It would be great to get these (roadblocks) all in a bucket and
say right, if we are really going to be serious about innovation…
let's turn this thing around."
Long timeframes to bring medical products to market, coupled
with a shallow venture capital market, created particular
challenges for Australian companies, the panel said.
They also discussed While biotechnology companies relied on
collaborative deals particularly with overseas companies to gain
skills, intellectual property and capital for different stages of
development, these transactions were hampered by taxes such as
stamp duty and withholding tax.
"One of the big things I find annoying is withholding tax - you
do a deal as a biotech company and you find five to 10 per cent of
the money goes to the Federal Government and why? You are a loss
making company and you pay what, for a very small company, is a
significant portion of that windfall to the Government," Dr Rathjen
The panel said continuity of existing government programs such
as Commercialisation Australia which provides funding to companies
to develop a product for market and the research and development (R
& D) tax credit which leverages private investment in
innovation, was critical to biotechnology which has long horizons
"If we change governments, they will change the scheme. I think
that is one of the worst things about these government programs -
industry hates change. I don't care about the perfect program - it
takes you a long time to learn the tricks of it," Dr Read said.
While research funding currently prioritises basic research,
more funding must be devoted to translating research into
marketable products, the forum heard.
"We currently spend $9 billion per annum on R&D and of that,
less than one per cent if you take out the auto subsidies, we spend
on translation. We need to allocate a percentage of funding into
translation - we could start with three per cent and move to 15 per
cent of R&D," Dr Funder said.
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