The Australian biotech market, which was valued at nearly $23 billion last year, is expected to see some positive growth to $25.2 billion by 2025, according to a GlobalData analysis.
The Australian biotech market, which was valued at nearly $23 billion last year, is expected to see some positive growth to $25.2 billion by 2025, according to a GlobalData analysis.
The growth, which was called modest in the report, will primarily be driven by “good market access to pharmaceutical drugs, increasing awareness of the need for the early detection of lifestyle and chronic diseases, the subsidized cost of prescription medicines through the Pharmaceutical Benefits Scheme (PBS) for all eligible patients, and the annual addition of new drugs to the PBS drug list.”
Chris Nave, chief executive of the Medical Research Commercialization Fund and head of venture capital group Brandon Capital, pointed to the growing biotech landscape in Australia in a recent column posted on The Pharma Letter. Nave said the pharma industry growth in Australia is being spurred on by sound government policy in the form of the R&D tax incentives, as well as $376 million from the government-initiated Biomedical Translation Fund (BTF). The company’s biotech sector has seen strong government support for the past century, Nave wrote, which has benefitted the company’s medical community. In his column, he touted not only government investment, but also Australia’s clinical trial programs, strong patent and regulatory law and access to capital as strengths of the industry which “provide Australia with a generational chance to supercharge this already important industry.” In his piece Nave pointed to the growth of venture capital in Australia, which is providing more capital than has been available before.
But, Nave noted there are shortcomings in the country’s biotech sector as well. First, when compared to the available capital in the United States’ two leading biotech hubs, Boston and the Bay Area, “the level of risk-tolerant investment capital in Australia remains severely inadequate.”
“This lack of capital has traditionally seen promising Australian medical discoveries leave our shores early in development to access these larger pools of capital, with little economic benefit to Australia. With the advent of the federal government’s Biotechnology Translation Funds and the Medical Research Future Fund (MRFF), hopefully, this intellectual property drain will be arrested,” Nave wrote.
Nave noted the government’s R&D tax incentives are a boon in ensuring that Australia remains an attractive location for carrying out clinical research.
“As a policy, it is doing a significant amount to expand and mature our local biotech sector which has the potential to deliver enormous wealth and health benefits to this country,” he added.
Nave noted there are some other concerns as well. He noted there is a “fundamental problem” with how academics and researchers are incentivized in Australia. Publishing is lauded, but those researchers who attempt to commercialize their discoveries can be punished. As the country looks to expand its biotech industry, Nave said it must provide them the pathway to direct these capabilities for the benefit of the country.
The United States is the largest source of foreign investment in Australia, with approximately $860 billion in investments, according to one University of Sydney study. In turn, Australian companies tend to invest more in the United States than any other country, including China, which has a growing relationship with Australia.
Multiple Australian companies have set up shop in the United States and are investing resources on growth here, as opposed to their home countries. One example is Mayne Pharmaceuticals, which two years ago committed $80 Million to its expansion in North Carolina. The South Australia-based company undertook a 126,000 square-foot expansion to support space for use in large-scale oral and solid-dose manufacturing. The Greenville, N.C. site manufactures the acne treatment Doryx and the combination pain treatment Lorcet, among others.
Australian companies are also forging partnerships that will provide them toeholds in foreign sectors, as well as strengthen their positions at home. For example, in March Australia-based Immutep struck a deal with Merck pair its lead immunotherapy product with Merck’s blockbuster PD-1 inhibitor Keytruda to treat three solid tumor types in a single trial. Immutep, which was formerly known as Prima Biomed, and Merck struck a collaborative clinical trial and supply agreement to initiate a Phase II study of Immutep’s lead immunotherapy product candidate eftilagimod alpha (IMP321) with Keytruda to target multiple cancer types. The drugs will be paired to treat non-small cell lung cancer (NSCLC), head and neck cancer and ovarian cancer in the mid-stage trial.
