WHEN Albert Tseng, head of the scientific advisory board of the
Melbourne-based drug company, Analytica, went to Taiwan five years ago, he
thought it was 鈥渓ike the old Wild West鈥�. The island nation鈥檚 pharmaceutical
industry was primitive, consisting mainly of makers of generic 鈥渕e-too鈥� drugs.
There was no notion of how to take a compound from basic research through to a
finished product.
Amid the dross, however, Tseng found gold nuggets waiting to be refined. At a
retreat, scientists from Taiwan鈥檚 leading research institutes took Tseng aside
and showed him a compound they extracted from the bark of a local hardwood. Now
known as cytonin, the compound showed promise as an anti-cancer drug. But lack
of proper protection for intellectual property had prevented the Taiwanese from
following up on their discovery.
Cytonin was not an isolated example. Analytica is now playing a key role in
developing the local biotechnology industry, acting as a bridge to Western
techniques of production for traditional medicines and safe development of new
ones.
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It all started when Analytica decided to fund the development of cytonin. In
July 1998, the company signed an agreement with Academia Sinica, the first of
its kind between a Taiwanese national research institute and a foreign firm.
Taiwan desperately wants to establish itself as a high-tech powerhouse. But
although the island鈥檚 information technology industry has been hugely
successful, it has been the exception.
In 1995, the Taiwanese government identified biotechnology as the industry
for the 21st century. So to help nurture it, the government instructed
institutional investors to fund biotech companies. The fund managers did as they
were told, and put money into existing US biotech firms. There were simply no
local firms worth backing.
What Taiwan really needed was a model for local firms to follow. To provide
just such a model, last October the Australian firm established a Taiwanese
subsidiary, Analytica Biotechnology. And, as a local company, Analytica
Biotechnology is well positioned to take advantage of government grants. The
government will pay up to half the costs of the expensive clinical trials of new
drugs, for example.
But there is another attraction as well as the cash鈥攁 unique piece of
infrastructure known as the Center for Drug Evaluation. It is the only facility
in the Asia-Pacific region (including Australia) certified by the US Food and
Drug Administration to carry out pharmacology studies on promising new
therapeutics.
Reardon estimates that studies at the US$300 million facility can cost
as little as half as much as in Europe or the US. When the centre won
accreditation last June, Analytica was its first customer. 鈥淲e鈥檙e becoming a
conduit for access to this wonderful place,鈥� he says.
In the three months since it began operating Analytica Biotechnology has
already signed strategic alliances with more than a dozen Taiwanese companies,
according to its CEO, Song Liu, a former finance ministry bureaucrat. They range
from startups to traditional industries thinking of going into biotechnology.
In addition to product development, Analytica鈥檚 other speciality is what the
company calls 鈥渕odern Chinese medicine鈥� or MCM, that is, the application of
Western scientific techniques鈥攕uch as standardised formulation and
manufacturing鈥攖o the production of traditional herbal remedies. Despite
the increasing popularity of Chinese medicine, poor quality control has remained
an Achilles heel. Australia is probably the second most advanced Western country
(after Germany) in the manufacture of MCM. 鈥淭here鈥檚 a huge opportunity for
development,鈥� Reardon says.