In addition to the Eli Lilly and Genzyme expansions, other recent developments on the biomanufacturing front include the following:
- Abbott Laboratories is investing approximately $50 million to create 125 new, highly skilled positions in biomanufacturing,
taking the total employed at its Dartford facility to more than 400. The investment will be for the production of advanced
biological reagents for use in diagnostic testing equipment.
- PowderJect, which was recently acquired by Chiron, is investing a further $140 million at its Merseyside site.
- A $166 million biomanufacturing center, BioCampus, is to be created in Edinburgh. This fully serviced 25-acre site will be
home to specialist biotechnology companies engaged in the manufacture of their own products.
Universities and Tech Transfer
The dynamism of the UK biotechnology industry is founded on Britain's outstanding universities and research institutions,
which remain at the forefront of global research. "The past decade has seen a dramatic change in UK universities with the
recognition that our research base is developing knowledge that has a value beyond its scholarship and additional to its traditional
output in publication," says Sir Richard Sykes, Rector of Imperial College London. "Today, more and more universities are
looking to exploit their intellectual assets in ways that more directly bring income and rewards to fund their work. Investors
have faith in technologies based on high quality research and UK universities have a strong and credible track record in supplying
it. Markets may swing up and down but there will always be a place for inventions that address healthcare, quality of life,
or quality of environment needs and concerns."
In the UK, as in the US, technology transfer is often overseen by university-owned companies such as ISIS Innovation, which
is wholly owned by the University of Oxford and provides the university's researchers with commercial advice; funds patent
applications and legal costs; negotiates exploitation and spinout company agreements; and identifies and manages consultancy
opportunities for university researchers. ISIS is just one of many similar UK organizations spearheading technology transfer.
According to Maire Smith, chief executive officer of the technology transfer group Manchester Innovation, "The key to technology
transfer is having a body that understands the bridge between the university world and the commercial world. It is essential
to have staff with commercial management experience who can visualize a market requirement for a technology or area of research."
Another primary focus is nurturing entrepreneurialism. "The incubator helps, as it shifts a researcher's mentality from academia
to business," Smith says.
Part of this shift comes through introducing the entrepreneurial researcher to experienced management, venture capitalists,
and business angels. These groups frequently take on both a financial interest and a business mentoring role in any new company.
UKT&I recently organized its second annual Biotech VC mission in which nearly 30 US venture capitalists met with British biotechnology
companies that were looking to raise R&D funding.
One established venture capital group is Global Life Science Ventures (GLSV). It closed its first $110 million biotech fund
in 1996. Although GLSV had a global investment focus - the bulk covered Germany and Switzerland, with a third going to the
US - it has expanded its focus to include the UK. From new offices in London, the VC group closed a second fund of $237 million
in autumn 2002. Although the group will consider any European or US investment, it will only take a lead investor role where
it has a base. "In the rest of Europe there are good deals, but we need direct dialogue and frequent interaction to mentor
a company properly," explains Philip Morgan, managing director of GLSV. "It made sense for us to come to the UK. It's significant
in terms of the number of life science companies and there are managers who have been through the biotech process before,"
he says. "The UK has a substantial interest in biotech and a large unquoted sector. There is also a good group of VCs in the
UK that we are interested to syndicate with."
Even while the global economy remains soft and difficulties abound for companies seeking funding, the British biotechnology
sector is growing and managing to attract significant investment. Within Europe, the UK is still attracting the lion's share
with around $528 million in public and private investments in 2002, approximately half of the European total for the year.
More than half of the investment funds raised came from private venture sources, making 2002 the second best year ever for
private equity infusions into British biotechnology. According to Keith Binding, director of Critical 1, a life sciences intelligence
group, "This demonstrates that VCs are prepared to back UK biotech with large sums of money."
Why do VCs find these companies so attractive? "The UK has sailed a fairly steady course, as its companies are more mature
and product focused. UK companies are therefore more attractive to venture capital than other European companies as venture
capitalists are looking for products," explains Binding.
The UK's public markets are also offering biotech companies increasing opportunities. "Last year there were only nine biotech
IPOs in the world. Three of those were UK companies, and one was Canadian but listed on the London Stock Exchange. In the
public markets, it's clear that London has re-emerged as the European market best able to support bioscience companies," Binding
says. Today, some 56 British technology companies are publicly traded, the largest number of any European nation.
In addition, the British government serves as a significant source of funding for the biotechnology industry. In partnership
with the Wellcome Trust, the government has committed $1.5 billion for the renewal and modernization of the science base infrastructure
in the UK. Furthermore, the UK National Health Service (NHS) spends in excess of $17 billion per year on goods and services
and is one of the few healthcare systems in Europe currently increasing its expenditure. The government estimates health-related
expenditure growth of 7.5% annually for the next five years.
Legal and Regulatory Framework
The UK has created a climate for biotechnology in which regulatory requirements aim to be
- proportionate to the risks involved
- scientifically based
- flexible and responsive to advances in scientific knowledge
- sympathetic to innovation while maintaining appropriate safeguards.
The UK has practical and effective arrangements in place for the clearance of products, such as novel foods, through the Advisory
Committee on Novel Foods and Processes (ACNFP), and diagnostics, through the Medical Devices Agency (MDA). The Gene Therapy
Advisory Committee (GTAC) has taken a pragmatic and sensible approach to controls on gene therapy. The Advisory Committee
on Releases to the Environment (ACRE) provides advice on genetically modified organism (GMO) consents.