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Press Release

University Bioventures –Key to Japan's biotech growth

Frost & Sullivan
Posted on: 16 Jun 03
University Bioventures –Key to Japan's biotech growth

Japan is said to be lagging behind the US and Europe in the biotechnology field. In the race to commercialize biotech products, the local industry has largely stayed in the shadow of their Western counterparts. From the mapping of the human genome, to Dolly the sheep, American and European researchers have constantly been in the limelight. But this is quite frankly not a fair indication of Japan's capabilities in cutting-edge biotech research. Inside the ivory towers of the country's top universities, lie potential blockbuster biotech products in the form of academic research. However, mostly due to the academic focus of university researchers, the commercialization of these technologies has been neglected.

Closing the gap

Driven by the strong government efforts to promote the growth of life sciences industries, researchers in universities are beginning to show keen interest in bringing their research to market. Researchers are becoming more open towards applying their research and seeing it as their contribution to society. As one of the governments' national biotech strategies to drive growth, Japan aims to have 1,000 biotech start-ups, including those from university-based research, by year 2010. And it looks like they are moving in the right direction.

From research lab to IPO

Making headlines for their IPOs in the Mothers market of the Tokyo Stock Exchange were bioventures AnGes MG Incorporated, headed by researchers from Osaka University, and more recently, Transgenic Incorporated, headed by leading university researchers from Kumamoto University. Both companies are reported to have agreements with top local pharmaceutical companies including Yamanouchi Pharmaceutical Co. and Daiichi Pharmaceutical Co.

More to come

Although Japan may lag behind in the commercialization of biotech products, it has always maintained high technology research in its universities and research institutes. The current start-ups that have come out may be just the tip of the iceberg. The opportunity for pharmaceutical companies to partner with these start-ups is immense –funding their research in return for licensing deals -potentially lucrative deals for the right product. Examples of research that has made the local headlines in the recent past include success in growing the world's first artificial eyeball in tadpoles using cells removed from frog embryos (Tokyo University) and injections of stem cells cultured from bone marrow taken from patients own hip bone as alternative heart disease treatment (Yamaguchi University School of Medicine), among others. With leading universities recently venturing into human embryonic stem cell research, the potential for new breakthrough is endless.

The right medicine for Japan's Big Pharma?

Some top local pharmaceutical companies in Japan are facing a dearth of pipeline products, and these new university start-ups may be just the answer to their woes. Japanese pharmaceutical companies, even top 10 companies are much smaller in scale compared to their US counterparts. With the extremely high cost of drug development today, many of these companies just do not have sufficient monetary resources to devote to R&D to fill up their product pipelines. Tanabe Pharmaceutical Co., Ltd. for example, has looked to other pharmaceutical companies including Pharmacia, Merck and biotech company Centocor for their current and future pipeline. Companies like Fujisawa Pharmaceutical Co., Ltd. and Shionogi & Co., Ltd. are also actively looking for candidates for their pipelines from outside their companies.

So, will we see more local pharma-biotech alliances involving start-ups originating from local universities in the next few years? At this point of time, it seems inevitable.

Innovative biotech products are set to drive market growth for Japan's pharmaceutical market, and hopefully the economy on a whole. Expect to see some blockbuster drugs take the world by storm.

For more information:
http://www.pharma.frost.com

Editor's Details

Katja Feick
Frost & Sullivan
http://www.frost.com
0049 69 7703312
katja.feick@frost.com

Last updated on: 27/08/2010

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