Lauded as one of the 21st century’s most promising industries, biotechnology is high on the economic development agenda of many countries. Although Taiwan’s biotech sector is being boosted by a number of government policies and regulations, more support is needed if it is to become the next signature industry.
In 2007, the Legislature passed the Act for the Development of Biotech and New Pharmaceuticals Industry, creating a legal framework for further policymaking. Four years later, the Cross-Strait Medical and Healthcare Cooperation Agreement, initiated by the Institute for Biotechnology and Medicine Industry, took effect. And amendments to the Fundamental Science and Technology Act, set to be reviewed by the Legislature in the upcoming session, are expected to promote R&D activity in Taiwan.
While these initiatives augur well for local biotech firms, the government-backed National Development Fund is reportedly considering slashing its investment in the Taiwan Medtech Fund from 40 percent to 20 percent. As the TMF is the country’s first state-sponsored venture capital fund focusing on biotech startups, this policy change may hamstring development of the sector.
The performance of the TMF is an important gauge of Taiwan’s biotech development. In addition to scouting for business opportunities at home, the fund should look for promising overseas projects that fit strategically with the local sector. This approach will give Taiwan firms more chances to cooperate with their foreign counterparts.
Other than funding support, commercialization of research results is a key factor when it comes to promoting Taiwan’s biotech industry. While an IBMI survey from last year shows a quarter of local firms having joint development projects with the tertiary education sector, whose solid R&D capabilities have yielded top results on the intellectual property front, no mechanism for long-term and institutionalized collaboration has been established. The disconnect between business and academia is best illustrated by the fact that only 0.3 percent of patented technologies in Taiwan were converted into marketable products and services.
The Cabinet’s solution to this predicament is to set up a super incubation center, which aims to coordinate stakeholder efforts at every level of the industry chain.
But for the SIC to achieve maximum efficiency in deploying resources, it is imperative that the entity be incorporated and run as a private concern. If the center is to be organized into just another one of Taiwan’s many state-sponsored entities and managed as a quasi-government department, the result will be further waste of government resources.
In addition to building a favorable legal and business environment, talent development represents another obstacle in the country’s drive to promote the biotech sector. There has never been a shortage of tertiary students majoring in biotech-related disciplines, but a scarcity of employment in the industry means many end up settling for other careers.
To prevent this talent drain, the government should recruit biotech veterans from abroad and step up efforts to nurture a high-caliber workforce for the industry. It must also consider diverting funds intended for state-sponsored research projects to local startups, enabling more researchers to be engaged in all-important R&D activities. Such on-the-job training will help these individuals learn to think outside the box and develop business approaches in line with market demand. (SFC)
Wu Ming-fa is CEO of Taipei-based Institute for Biotechnology and Medicine Industry. These views are the author’s and not necessarily those of Taiwan Today. Copyright © 2011 by Wu Ming-fa
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