The BioEconomyThe BioEconomy

By Dr J R WebsterBy Dr J R Webster

Executive Director: Executive Director: AfricaBioAfricaBio

The BioEconomyThe BioEconomy

Global biotechnology dynamics.

Status in Africa.

Where are we in South Africa?

Will we have a BioEconomy?

CURRENT TRENDS IN THE BIOTECHNOLOGY INDUSTRY

the biotechnology

century Current trends

In 2000,biotech companies raised US$37.2 billion through public and private financing, US $10 billion in 2001

The completion of the “rough” draft of the sequence of the human genome signals a new era in the biotech industry.

This means that the biotech industry has its best years ahead of it.

4,254 biotech companies globally in 25 nations

CONTINUATION OF CURRENT TRENDS IN THE BIOTECHNOLOGY

INDUSTRY

Biotech companies develop more than half of the approved medicines in the US

Biotech companies fall into one of two categories:

Product development e.g. Genetech, MedImmune,

Qiagen

Service Companies e.g. Celera,Incyte,Evotec

Current Trends contdCurrent Trends contd..

622 public biotech companies generated $35 billion

Spent $16 billion in R&D Employed 188,000 in 2001 72% of revenues generated by US companies

Biotechnology companies are currently listed on the:

Neuer Market

EASDAQ

Swiss New Market

NASDAQ

Alliances

Pharmaceutical industry has recognised the value delivered by biotechnology to the drug development process.

Biotech-pharma alliances for drug discovery have been increasing steadily from 101 alliances between 1988 to1993 to 145 alliances in 1997 and 1998 alone. More than 480 pharm – biotech collaborations and 550 biotech – biotech partnerships globally in 2001.

Alliances in other areas – drug delivery, vaccines etc have been increasing at a similar rate.

Measurements of Measurements of Success in Success in

BiotechnologyBiotechnology Financial- What happened to the Nasdaq

Biotech Index The Nasdaq represents the most actively

traded biotech stocks. The index is a capitalisation-weighted index.

The Nasdaq Biotech index(NBI) has increased 437% since its inception on Nov. 1 1993.

In 2000, The NBI increased 23% out-performing all other Nasdaq indices.

Biotech Product developmentBiotech Product development(drug development)(drug development)

Matured since 1982 when r-insulin was developed.

Now over 120 approved biotech drugs available. Now over 300 in last phase of clinical

development in the USA alone. Biotech products now account for half of all

newly approved medicines in the USA- this will increase.

Companies not using biotech will pay double the costs to produce a new medicine.

What will increase What will increase biotech product biotech product development?development?

Genomics

Currently 500 disease targets are used to develop new medicines.

In 5-10 years genomics will deliver 5,000-10,000 disease targets

Advanced Genomics Will Advanced Genomics Will Accelerate Discovery of Accelerate Discovery of

Next Generation ProductsNext Generation Products

Genome Gene map Gene sequence Gene expression Ag traits

YieldDrought

Disease

Stress

Oil quality

Maturity

Stress

DiseaseYield

Herbicidetolerance

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g

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ct

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c AlzheimersBreast Cancer

Arthritis

Stress

Aging

Aging

CV Disease

ObesityVision

Arthritis

Pharma traits

t

Solving unmet needs in human health and food production

g

How does policy affect How does policy affect biotech business and biotech business and policy development?policy development?

Key growth factor in USA pharmaceutical industry has been the Orphan Drug Act 1983.

To overcome lack of investment into drugs to treat small numbers of patients- US granted 7yr exclusivity and other incentives to companies for orphan drugs.

Now 900 orphan drugs developed with 200 approved.

Biotech companies file 85% of applications for new orphan drugs.

This approach has now been adopted in the EU.

Predictions

2010: Predictions tests for 25 genetic conditions will be possible along with interventions to reduce risk of their onset

2020: Designer drugs for diabetes, hypertension, cancer and other major illnesses will be developed and prescribed for patients based on genetic profile, making medicines more effective

2030: Genes involved in ageing will be fully characterised and clinical trials of drugs to extend normal human life will be underway

2040: Comprehensive genomics-based health care will be the norm

New AdvancesNew Advances

NOVEL APPLICATIONS OF BIOTECH

Spider silk-harvested from protein in goats milk (bullet proof vest, medical applications)

Plants as factories for pharmaceuticals and industrial products, (biopolymers, new oils or fibres) as biosensors, salt tolerant crops (grow in sea water) virtual plants

Flowers with different patterns, miniturized and longer shelf life

WHAT ABOUT DEVELOPING COUNTRIES?

Technology divide will continue unless governments invest (see World Bank-Health Genomics Divide report)

New African Initiative could be extended to genomics

Cuba has 400 biotech patents (exporting biotech vaccines)

Brazil has rapidly developing genomics and biotech industry

India increasing investment in genomics and biotech ($85 million on genomics in next 5 years)

Nigeria and South Africa investing

GM Crops World-wideGM Crops World-wide Over 30 GM Crops.

Including the following: maize, wheat, soya beans, papaya, raspberries, tomatoes, canola, potatoes, peppers, cabbage, cucumber, squash, cotton, grapes, carrots and chicory.

Trees, turf, flowers

GLOBAL AREA OF GM CROPS

30 FOLD INCREASE SINCE 1996

Global Arear of GM Crops, 1996 to 2001

1.7

11

27.8

39.944.2

50

0

10

20

30

40

50

60

1 2 3 4 5 6

YEARS

1

2

3

4

5

6

Source: Clive James, ISAAA

Where are we with GM crops Where are we with GM crops world wide?world wide?

GM crop planting globally increased by 11% in 2000 and >10% in 2001. It has slowed down due to slow development of new markets and lack of products with consumer benefit

More developing countries are commericalising and investing in crop biotech

China wants to be the Asian centre of excellence

Between 1997 and 1999 China approved 26 applications for commercialisation of GMOs, 59 for environmental releases and 73 for field trials

Biotechnology R&D in sub Biotechnology R&D in sub Saharan AfricaSaharan Africa

Status of R&D in sub-Status of R&D in sub-Saharan AfricaSaharan Africa

Primarily second generation biotechnology e.g. plant tissue culture (Ghana: cassava, yam, pineapple, cocoa,banana,etc; Nigeria:cassava,yam,banana,cowpea etc).

Genetic engineering projects aimed at pest and disease resistant crops.

Crops include: sweet potato, banana, sugar cane, cassava, sorghum and maize.

Other projects include development of molecular markers and probes.

Virus resistant sweet potato in Kenya, expect insect resistant maize soon and possibly fungal resistant banana.

Being or to be tested in Egypt is GM squash, melon, cantalope, tomato, potato, sugarcane, maize, cucumber and wheat.

Insect resistant cotton in Zimbabwe. Few GM crop field trials in Africa and South

Africa is the only country with commercial GM crop but GM commodities are ready for export to Africa.

Field Trials in Africa-Field Trials in Africa-What’s the Reality?What’s the Reality?

Status of Biotechnology in Status of Biotechnology in South Africa*South Africa*

Over 500 biotechnology projects spread over seven sectors.

Medical and pharmaceutical sector attracts the most funding; plant sector second largest.

Few local products are developed, imported technology is driving commercialisation &

industrial growth.

Half biotechnology funding is spent on genetic modification projects.

Consumer awareness is critical.

*Taken from report for CSIR 1998 (Webster & Koch)

South Africa as a Case South Africa as a Case StudyStudy

R&D for 20 years Plant trials for 10 years (using existing policy) New GMO policy implemented in *1999 Only 4 commercial approvals by end 2001 About 110 plant biotech groups (academic and

research) Over 160 plant biotech projects About 45 companies using biotechnology in food,

feed and fibre Public not informed; Anti-activists making an

impact

Changes in SA statusChanges in SA status

National Strategy

Labeling Legislation

Venture capital

Bioincubator

Consumer perceptions

Successful Successful Application of Biotech provides Application of Biotech provides

positive perceptionspositive perceptions

Change in Approach of EUChange in Approach of EU Purvis report has a lot of support Want to be the knowledge based center of excellence

and highlighted biotechnology Purvis report opposes that medical biotech provides

opportunity and agbiotech provides risks Regrets moratorium for GM which was not based on

scientific evidence EU has not licensed new GM crops since Oct. 1998 New regulations mean lifting of moratorium,GM crops

will be planted in spring 2002 in Europe

Future prospects in EUFuture prospects in EU

New biotech strategy for EU is being developed- AfricaBio had input into this in Sept 2001

Commercialization of GM crops will proceed but will be slow

Different approach to public awareness-statements by EU e.g 15yrs of GM safety research has been carried out with 81 projects and 400 teams from different disciplines-GM crops just as safe as conventional foods

What lies ahead for biotech What lies ahead for biotech companies?companies?

Biotech business still at the beginning of the growth phase

Biotech is still seen as high risk Estimate that success rate for biotech business

is 13% Biotech companies founded in the next 5 yrs

have a chance to do as well or better than their predecessors

Biotech acquisitions will continue Partnering was Pharm/Biotech will be more

Biotech/Biotech

What is the Bio-Based What is the Bio-Based Economy?Economy?

Non-renewable resources

Process

Product

Waste

Renewable bio-resource Bio-process

Bio-product

Byproduct

Conventional

Bio-Based

Fossil C energy

Renewable energy

Recycle into bio-resource

Landfill or incinerate

Dr. J.F.Jaworski

Role of Biotechnology in the Bio-Role of Biotechnology in the Bio-Based EconomyBased Economy

(OECD)(OECD)

One of several key enabling technologies Biotechnology is converging with info-technology,

chemistry, physics, materials and nano-technology Bioprocesses: biotech can increase eco-efficiency Bio-resources: biotech can increase productivity &

sustainability of supply GMOs: essential to maximize efficiency & productivity

to achieve sustainability; BUT this has to be proven

Dr. J.F.Jaworski

MessagesMessages to business from OECD to business from OECD study on the application of study on the application of biotechnology to industrial biotechnology to industrial

sustainabilitysustainability

Why adopt biotechnology? To improve costs and be environmentally friendly

Be aware of change, find yourself an R & D partner

Have a champion, assemble arguments to convince doubters

Build your own in–house biotech skill base Companies – work with government and

biotech stakeholders

Dr. M. Griffiths

What should the What should the pharmaceutical industry do?pharmaceutical industry do?

Develop a clear understanding of the role of biotech in medical & pharmaceutical sectors.

Develop clear messages/statements about modern biotechnology

Inform your clients and stakeholders on biotechnology

Work with AfricaBio