FROM SCIENCE TO BUSINESS :

WHAT IT TAKES TO BUILD

A BUSINESS
BIOMALAYSIA 2011
22 November 2011

INNOVATION is the central issue in

economic prosperity.
Michael Porter

Yesterday and Today

1975

2011

The idea of a portable

computer..
3

Yesterday and Today

1975
A new drug could be
developed and
approved (on average)
for about $150 million
and could take about
7 years.

2011
Today, the cost is $US 1.5 to
2 billion and it takes more
than a decade.

The world now consumes 85 million barrels of oil/day, or 40,000

gallons/second, and demand is growing exponentially.

As the oil source runs out, the price will increase..

Conventional
business

Knowledge-based
business

Supplier-driven

Customer-driven

Drivers of growth

Labour, land, capital

Talent, knowledge,
capabilities

Competition

Size:
The BIG eats the small

Speed :
The FAST eats the slow

Marketing

Mass marketing

DIFFERENTIATION

Education
requirements

Degree

Continuous learning: It's not

what you know, it's how fast
you can learn

Employees seen
as..

Expense

Investment

Economy

 Recognizes the importance of knowledge to their

business bottom line
Intellectual Property Rights
Develops new measures of corporate performance
based on knowledge
Creative ways to measure and manage
innovation
Provides a technology infrastructure to enhance
knowledge creation and sharing
Have a Knowledge Management System in place
Encourages the sharing of knowledge through
effective Internet settings and business
practices.

Biotechnology Industry Cycle

Key Success Factors
Access to funding

Biotechnology
Industry Cycle

Sustainable
innovation
ecosystem
Industry presence
Regulatory &
Business
Environment
8

Cash Flow Management

Creative cash flow management to reduce burn rate and capital

requirements.
Reach meaningful milestones to increase capacity to raise more
cash.
9

Take Off Before the Runway Ends

10

Limited Access to Financing Will Starve Growth

Source : Burrill & Co.

Development and Financing of Bio-based Start-ups

11

 In addition to less available innovation capital, biotech

companies face increased competition from other
sectors for a smaller pool of venture capital.
Creative approaches to sustain
innovation in this increasingly
challenging environment.
Moving to the next level accessing capital
internationally.

Cutting the Same Cake in A Different Way

Will Not Solve the Funding Issue

12

Leave the Experts to What They Do Best

However, the CEO is responsible for the stewardship of the
innovation process.

Innovator
CEO

Takes care of strategy, funding,

direct involvement with the Board,
market strategy, and everything
else besides innovation.

Innovate,
innovate and
innovate.
13

 Critical mass infrastructure

human capital is critical to
innovation.
Innovation-driven jobs create
higher value.
Strengthen workforce: attract
talent back to Malaysia.
We need a sustainable supply in
the talent ecosystem to drive
the industry.

Talent = Competitiveness.

Knowledge &
Skill Building
Creativity
Entrepreneurship

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 6-month intensive training program

to provide additional skill sets to
meet industry requirements.
Job placement,
industrial training and
internship in companies
for graduates.
Expand program outreach to cover
local and global context.
15

 Participates in collaborative research

Amgen has more than 100 active
collaborations worldwide to complement
in-house capabilities.
More than 800 firms now work with MIT
on multidisciplinary research programs.

UNIVERSITY

Entrepreneurial focus is the key

to success of industry/academic INDUSTRY GOVERNMENT
collaboration.
Strengthen network and increase
level of collaboration.
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 Industry will at best benefit from less

costly high quality research.
Universities will benefit from the
funding from the Industry.
The joint effort makes it possible to
conduct research leading eventually to
new products and services.
The NBP aim is to spin off 25 companies
from Universities by 2015.
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Build your strengths

Networks of the weak do not survive.
Identify assets that have value to partners and strengthen them.

Spread involvement. Create more ties for more people

More people at more levels must get involved. The more people feel
included, the easier it will be to implement partnership activities.

Help everyone win

Organisations that derive greater value from alliances tend to have greater
communication, share information, promote an atmosphere

learning.

of

 The competition landscape is

FLAT, INTERCONNECTED
and
BORDERLESS.
Greater competition would lift the productive
efficiency of innovators/entrepreneurs and induce
them to innovate and develop better products.
Be aware of changing market dynamics.

19

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Moving on from Capacity Building to Commercialisation Phase

Indicators

Phase 1

Phase 2

Phase 3

Total

2005-2010

2011-2015

2016-2020

Phase 1 to 3

RM 6 billion

RM 9 billion

RM 15 billion

RM 30 billion

40,000

80,000

160,000

280,000

RM 20 billion

RM 50 billion

RM 100 billion

RM 100 billion

2.5%

4.0%

5.0%

5.0%

New Spin-off
Companies

25

25

50

Global Companies

20

20

New Investment
Employment
Annual Revenue
Contribution to GDP

Bigger challenges are ahead

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of us

One Stop Centre

Facilitation

Foreign Direct
Investment

Domestic Direct
Investment
Advocacy

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Policies on
biosafety, IPR,
ABS

Aligned to
best practices

Aligned
Funding /
incentives /
tax structure

BioNexus Status

Development of scientists,
engineers, specialists, etc

Legislation
&
Regulatory
Framework

Human Capital
& Science

Funding &
Incentives

International
Accreditation

GLP, GCP, GMP, etc.

Physical
Infrastructure

Public Sector
Delivery
System

Shared
infrastructure
& services

Laboratories,
Pilot Plants
etc.

Benchmarking
of service levels

BioNexus Partners
(BNP) Initiatives

 BioNexus Programme - a key element of

the National Biotechnology Policy
(NBP).
Competitive fiscal incentives for both
foreign and domestic investors.
Supported by BiotechCorps other
initiatives in building a conducive,
enabling environment.
204 BioNexus companies today - a
credible representation of Malaysias
emerging biotechnology sector.
24

207
Agriculture

Healthcare

Industrial

25

BioNexus Companies Listed on Stock Exchange

Total Market capitalisation
RM 847.5 million
Market
capitalisation:
RM 44.6 million
Market
capitalisation:
RM 670.7 million

Market
capitalisation:
RM 34.4 million
Market
capitalisation:
RM 65.9 million

Market
capitalisation:
RM 31.9 million

Note: Market capitalisation value as at 28 October 2011

 Malaysia is among the first few

advanced-thinking countries driving a
bio-based economy.
It is not only in line with global trends,
it will also have long-term benefits to
Malaysias economy, welfare,
productivity, health, environmental
and societal well-being.

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 Understand the role of knowledge in

international competitiveness.
Collaboration is integral to manage
business risks and success rate.
The true winners will be those that
recognize todays challenges and take
a long-term and global view, and are
creative in the design of their
strategies.

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THANK YOU
Dato Dr Mohd Nazlee Kamal
Chief Executive Officer
nazlee.kamal@biotechcorp.com.my
www.biotechcorp.com.my
Tel :
Fax :

+603 2116 5588

+603 2116 5577