SEOUL - Korean pharmaceutical outfits and investors should focus more on burgeoning biotech companies and take advantage of the Korean government's increasing interest in funding the industry, Burrill & Company CEO Steven Burrill said at the Bio Korea 2009 meeting in Seoul Sept. 16.

Noting that even Roche's partnering with Genentech and other multinational megamergers do not yet account for a global market share of more than 7 percent, Burrill said that small pharmaceutical firms and investors could start their own biopharmaceutical companies and take advantage of stronger government funding.

"Governments - in various ways - are our partners," Burrill stressed, and they are increasingly investing in stem cell technologies, biosimilars and building up biotech infrastructure, he said.

In fact, Burrill and Korea's Health Industry Development Institute inked a memorandum of understanding aimed at boosting "strategic investment" in local Korean biotech companies and seeking foreign markets for those companies.

Under that agreement, the Korean institute will select biotech companies for possible investment and Burrill would then "seek ways to grow the firms," an instititute official told PharmAsia News.

The two sides will cooperate in Korea's development of biotech products, coordinating related talent and exchanging information, and then opening foreign markets for local biologics firms to enter, the official said.

Encouraged by the Korean government's bid to expand the local biotech industry as one of its five leading sectors by 2016, Burrill & Company has been looking to enter the Korean market by preparing a "bio fund," the institute said.

"We have a great opportunity to create a new company today that [will have] a major share in the market," the CEO of the VC company said.

After signing the MOU with the institute, Burrill and KB Investment officially launched a "bio-investment fund" of KRW100 billion ($83.3 million).

With the aim of having at least three local biosimilars in development by 2012, the Ministry for Knowledge Economy said it will use part of the KRW 100 billion earmarked for national biotech projects and allocate funds for research and development and capital investment in biosimilars (Also see "Korean Government Accelerates Support For Homegrown Biosimilars" - Scrip, 1 June, 2009.).

"We already promised a government support package of KRW 20 billion for the biopharma industry, and we will draw KRW 80 billion more from other sources including long-term private-public funds for biopharmaceutical companies," Kim Sung-Su, a deputy director at the ministry, said in an earlier interview. "The government drive is aimed at helping local pharmaceutical companies advance into global markets with their competitive biosimilars and generics in coming years."

Sea Change For Biopharma Industry Via Healthcare Reform

The world faces massive challenges with healthcare reforms, Burrill said. "But the most significant thing - in terms of biotechnology - is thinking about the market place, which is driven by high technologies and an aging population," he said.

"The Big Pharma model is broken, and the umbilical cord for funding innovation [the capital market] is broken, changing access to innovation," he stressed. He said that while innovative technologies will keep people alive longer, healthcare costs will keep climbing.

Demand from Asia and other regions for drugs and better healthcare will also increase while research and development will migrate to Asia. Since diseases know no boundaries, every company will be "global," he said.

The new big markets will be Alzheimer's disease, obesity, diabetes, metabolic disease, anti-aging therapies and anti-infectives.

China and India will keep the world market for health and wellness expanding with their huge populations, growing wealth and middle classes, and South Korea, the Middle East, Latin America, South Africa, Russia and Eastern Europe will also fuel growth, according to Burrill.

Backed by continued government initiatives, medical tourism will also stay on the rise, led by key players such as South Korea, India, Mexico, Singapore, Thailand and Costa Rica, he noted.

- Peter Chang (p.chang@elsevier.com)

Burrill & Company Forms Joint Bio Investment Fund With Korea - Bio Korea 2009

More from Archive

More from Scrip