HARNESSING THE HUMAN GENOME
Thanks to its unique database architecture and geographical reach, Shanghai-based genomics pioneer Wuxi NEXTCODE is best placed to decode the human genome for improvements in preventive healthcare and diagnosis of rare ailments
adding that other jurisdictions around the world have special courts set up for such cases.
Hong Kong investors and venture capitalists' lack of experience in dealing with research-driven companies has also added to the difficulties faced by wouldbe biotech start-ups. Moreover, investors and entrepreneurs point out that venture capitalists in Hong Kong tend towards shorter, faster rates of return, which works against biotech. Wilton Chau, a biotech investor, chairman of the Qleap Venture Fund and vice-chairman of the Hong Kong Biotechnology Organisation, says that most Hong Kong venture capitalists don't know how to invest in biotech. He points to a global trend of venture capital investing in asset-light, low capital expenditure projects.
Li of Novoheart has taken matters into his own hands. He is creating a fund specifically for investing in Asia-based biotech companies. The first investment is of course into Novoheart, but Li says he is gathering other investors together.
Moreover, he is now the director of the Hong Kong branch of the Karolinska Institute, the Swedish research university dedicated to reparative medicine. The Karolinksa Institute selects Nobel laureates in physiology or medicine. The local node is based at the Hong Kong Science and Technology Park, which also hosts all the city's biotech companies focused on research. It recently celebrated its first anniversary.
The institute in Hong Kong is focused tightly on biotechnology research and commercialisation, says Li. He hopes it can recruit up to 100 researchers, with as many as 60 of those from Hong Kong and the rest from overseas.
Li, ever the optimist, says that progress on the institute has been “faster than expected”, adding that it is getting a lot of attention for its work already. “Big pharma companies are asking to see the Karolinska Institute Hong Kong node.”
The new government of Carrie Lam has also inspired hope. Li describes the recent announcement that the Hong Kong government aims to increase R&D expenditure from 0.73 per cent to 1.5 per cent in five years as an “exciting first move”. The need, he says, is for more success stories in Hong Kong to encourage investment and interest from students and would-be researchers that can create and staff new biotech start-ups.
So far, Hong Kong has lagged behind regional rival Singapore in the quest to become a hub for biotech, but the window of opportunity to move ahead may be here. Securing funding has been difficult for the pioneers showcased here, but research that was started 15 or 20 years ago is now starting to bear fruit, says Dr Cecilia Pang, biotechnology director for the Innovation and Technology Commission. She points out that international investor interest in Hong Kong biotech, particularly from mainland China, is growing.
Meanwhile, the Hong Kong government has been quietly investing into local biotechnology ideas. As of August 2017, the government's Innovation and Technology Fund has approved HK$836 million for 433 "biotechnology-related projects".
Singapore, which began its push into biotech over 20 years ago, settled on a strategy of offering tax incentives to big pharma companies to set up there. But while that may have encouraged companies to put regional headquarters there, it may leave an opening for Hong Kong to offer up a more complete ecosystem of biotechnology development, Pang says.
Generating international investor interest may be the
key to getting Hong Kong biotech from infancy to a more mature phase. The city's top life sciences professionals often have international networks that can help with this, as seen with our profile scientists. Dr Daniel Lee of the HKSTP says that the number of biotech companies at the park has grown from 30 to 100.
And despite the longer investment timelines of biotech, there is interest from Hong Kong's biggest corporate groups. CK Life Sciences, a subsidiary of Cheung Kong Holdings and chaired by Victor Li, is invested in biotech, but not yet in Hong Kong.
Meanwhile, Li and his company have listed on the Toronto Stock Exchange, in part, he says, because Hong Kong's stock exchange is not yet ready for biotech. Albert Yu, in his role as chairman of the HKBIO, is organising Hong Kong's first ever biotechnology conference in November. Just after our cover photo shoot, he was off to Shenzhen, seeking funds for the future of Hong Kong.
– Derrick Au