PerspectivesAre you interested in submitting a Perspective Article? Be sure to read The Science Advisory Board's Editorial Guides for Perspective Articles. Click here. Biotechnology in Taiwan—An International Perspective by Enal Razvi, Ph.D. Summary With twenty three million inhabitants on the island and an economy driven in large part by their electronics industry (which is now maturing) Taiwan (like its neighbors) seeks to participate in the growing biotechnology space. The segments of the biotechnology industry where Taiwan’s public and private efforts are focused on are genomics, drugs, diagnostics, agricultural biotechnology, environmental biotechnology, protein drugs, contract research organizations, biochips and bioinformatics. We document here qualitative and quantitative factors in this space. Introduction—Public Efforts toward Biotechnology in Taiwan The three major Taiwan government bodies that are pooling funding and oversight of biotechnology and life sciences in the country are:  These three major government bodies driving life sciences in Taiwan are overseeing several initiatives for life sciences in general and biotechnology in particular. The National Health Research Institute (NHRI) is a non-profit foundation established by the government with its organization charter created by an Act of Congress (the Legislative Yuan which means the legislative body [congress] of Taiwan) and signed in 1995 by then President Teng-hui Lee of Taiwan. Being an autonomous research organization under the supervision of the Department of Health (which itself reports to the Executive Yuan, which is the administrative body that runs day-to-day operations of Taiwan), the NHRI is dedicated to the enhancement of medical research and the improvement of health care in the country. The MOEA (Ministry of Economic Affairs) operates under the Executive Yuan. Finally, the NHRI is analogous to the US National Institutes of Health (NIH)—the body responsible for coordinating medical research activities. The NHRI consists of ten research divisions and four departments (Administration, Intramural Research, Extramural Research, and Research Resource). Scientists at the NHRI conduct mission-oriented medical research and investigate many aspects of the basic biomedical sciences, as well as specific diseases. These range from the common problems such as aging, cancer, infectious diseases, mental disorders, and occupational diseases, to health policy. The NHRI has been established to serve the following purposes: • To plan the overall directions of national science and technology development in health and medical care • To coordinate, integrate, and support research activities undertaken by medical institutions in Taiwan • To further educate and train young scientists and physicians • To establish an objective and fair system for reviewing and assessing research projects and their progress • To facilitate the exchange of information and to promote domestic and international cooperation The NHRI has set up ten research divisions to conduct research in the biomedical sciences [this is similar to the different institutions that compose the US NIH]—these research divisions are presented below: • Division of Cancer Research • Division of Molecular & Genomic Medicine • Division of Clinical Research • Division of Biotechnology & Pharmaceutical Research • Division of Biostatistics and Bioinformatics • Division of Health Policy Research • Division of Environmental Health & Occupational Medicine • Division of Medical Engineering Research • Division of Mental Health & Substance Abuse Research • Division of Gerontology Research • Vaccine Research and Development Center • Stem Cell Research Center • Nanomedicine Research Center • Health Policy Research Center The above structure is highly reminiscent of the US NIH with its intramural program as well as an extramural program—in this case, the NHRI funds researchers at its collaborative institutions. The NHRI—as the main face of publicly-funded Taiwanese biotechnology and biomedical sciences—maintains many collaborations with institutions both within and outside of Taiwan. The following list presents some of these major collaborative institutions: • Academia Sinica • Industrial Technology Research Institute • INSERM, France • Institute for Biotechnology at Medicine Industry • Kaohsiung Medical University • National Cheng Kung University • National Chiao Tung University • National Defense Medical Center • National Institutes of Health (NIH), USA • National Taiwan University Medical College • National Tsing Hua University • National Yang Ming University • National Science Council • Tzu Chi University • Veterans General Hospital—Taipei The major areas of focus—four major national research projects in Taiwan—on life sciences in general and biotechnology in particular are: • Biotechnology and drug development: Covering new drug screening and discovery approaches (including small molecules, natural products, proteins, antibodies, vaccines, and biochips) • Agricultural biotechnology: Covering animal vaccines, aquaculture, horticulture, health supplements, medicinal plants, transgenic plants, and valuable genes from plants • Chinese herb medicine: Establishing the processes for new formula discovery and manufacturing, including genetic typing of raw materials, chemistry-manufacturing-control processes, animal models for drug screening and pharmacology, toxicological studies, and IND filing • Genomic medicine: Building a research center, establishing research tools, identifying disease-causing genes of regional significance, studying pathological mechanisms, etc. One of the biomedical research areas where there is significant push in Taiwan is the development of an NHII (National Health Information Infrastructure), coupled with Taiwan's first national genetic database to be developed into the "Taiwan Biobank." This biobank aims to collect DNA samples from about 300,000 Taiwanese people and use the prowess of IT technology of Taiwan to generate the world's most competitive database of DNA samples aimed at markets in ethnic Chinese communities worldwide. This is analogous to the UK Biobank database as well as Decode Genetics of Iceland, which seek to characterize populations with detailed medical records that can be used for patient stratification in drug development. The academic and industry partners in this project are: NHII as the organizer of the project and project participants (Academia Sinica, National Taiwan University, and Vita Genomics of Taipei). Public and Private Funding for Biotechnology in Taiwan, Tax Incentives, and Drivers of this Marketplace There will be a total of more than NT$150 billion (about US$5 billion) of investment in the biotechnology space from the governmental and private sectors in the coming five years in Taiwan, and approximately more than 500 biotech companies will be established in the next ten years, according to projections from the Taiwanese Government. Taiwan’s biotechnology company incubation centers have created 221 biotechnology startup companies in 2004, an increase from 132 such startups in 2003. This suggests that the biotech industry will be an important mainstream industry in the future for Taiwan. In addition, biotechnology industry parks have been established: northern Nankang Biotech Park (Taipei), central Hsinchu Biomedical Park (between Taipei and Taichung), and southern Kaohsiung Biotech Park (Taiwan), and a few more science parks are in the planning stages. There are several drivers for biotechnology in Taiwan, namely: • Strong entrepreneurship • Improving academic biomedical research • Large numbers of life science graduates (5,000 per year) • Excellent performance of overseas Chinese in biotechnology • Venture capitalists’ capacity and international experience • Experience and success in building out their IT industry • Partnership with North American communities • Extensive operations of Taiwanese enterprises across Asia, especially in mainland China The following discusses some of the drivers for biotechnology in Taiwan, including government-driven tax incentives for biotechnology. Currently, more than 16,000 people are directly employed in the biotech community of Taiwan, and this number is expected to increase. The operating costs for biotech companies in Taiwan are only about one third to half to that of that in the US and Europe—this cost including salaries, clinical trials, and R&D expenses is much cheaper than that in the US. In addition, the Taiwanese government provides subsidies for R&D projects and clinical trials—to the tune of approximately 35 percent to 45 percent of funding. In terms of government subsidies for biotechnology, there are several schemes available that provide direct and indirect subsidies and tax shelters to biotechnology companies. The following describes these subsidies. Government incentives for biotech firms are comparable to those offered to the electronics firms—the backbone of Taiwan’s economy. The public policy provides incentives to promote biotech which includes: • Financial aid—R&D Grants and Clinical expenditure grants • Tax deduction • 5 year income tax deductible or investment tax deductible • 30-50 percent of R&D expenditure as income tax deductible • Contract research organization (CRO) expense as an R&D investment which is tax deductible The following table details the government subsidies and tax incentives offered to biotechnology companies—illustrating opportunities available to emerging and nascent companies in Taiwan:  We document here the public and private efforts to seed biotechnology into Taiwan. We present herein the funding and the various government-sponsored institutions that are promoting life sciences in general, and biotechnology in particular, in Taiwan. Note that the majority of companies in the life science space here are small and emerging, which is appropriate since Taiwan is only beginning its push into biotechnology—having recognized this as an important discipline going forward. We note, however, that in comparison with other Asian economies, such as Singapore, where biotechnology is given a premier position for their economies going forward, our sense is that Taiwan’s efforts are emerging and poised to yield success. However, the success of Taiwan’s IT and microelectronic industry is indisputable. Therefore, our sense is that the entrepreneurship exists, given the appropriate stimulus—from the Government and private sources (venture capital and otherwise)—to nurture a biotechnology industry in Taiwan. ### << Previous Next >> [ View All Perspectives ] |
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