The Gauteng Department of Agriculture, Conservation, and Environment (GDACE) on Tuesday stated that biotechnology had the potential to transform not only South Africa’s economy, but the also the global economy.
“This health-oriented, environmentally friendly industry is solving the problems that matters the most, and in the process growing at a remarkable rate, while creating decent jobs at the same time,” said the head of the GDACE, Stephen Cornelius.
However, Cornelius noted that the commercialisation of biotechnology was not without its challenges, among which were: access to capital, access to technology and information, and access to human resources.
“For us to succeed in building a biotech industry and addressing the challenges, we must have the tools that address the constraints. The tools that would enable us to develop world-class science, plenty of capital for investment, a straightforward and clear regulatory framework, respect for intellectual property rights, and adequate commercial markets.”
Cornelius noted that these tools were at the core of Gauteng’s Biotechnology Strategy.
“Any nation that hopes to cultivate biotechnology must support education to ensure that biotech companies have the workforce that they need. Ultimately, one of the limiting factors on biotech growth may be access to qualified scientists,” he added.
To assist with this, the Gauteng province has created a Biotechnology bursary programme, which would benefit 45 students at four tertiary institutions this year, while a further 12 students would benefit from an internship programme.
“Generous funding for basic academic research is essential. Hence, as Gauteng we have put in place a research agenda that looks at funding of biotechnology as well as agricultural research that shows the potential for commercialisation,” Cornelius said.
He added that private investors had a critical role to play in the development of the biotechnology sector, as small biotech companies currently depended on government support to get ideas off the ground.
“We firmly believe that every biotech company needs the support of investors, corporate partners, and research collaborators. We are therefore seeking ways and means to ensure that there is an increased investment in the biotechnology sector, starting in Gauteng.”
Life sciences incubator eGoli Bio CEO Sipho Moshoane said that investment in the biotechnology sector, called Angel investing, was still in its infancy stages in South Africa.
However, Moshoane noted that the current economic downturn would be beneficial to the sector, as investors were hunting for science-based investments.
“Fortunately, when you look at international and local experience with Angel investing, that with the economic downturn that we are experiencing internationally, and to a lesser extent locally, literature and hard facts suggest that biotechnology is benefiting from the economic downturn, because a lot of investors have burned their fingers in the early 2000s with the dot-com investments. Now they have gone back over the past few years, and with the economic downturn, they are now realising that there are benefits, because biotech is built on hard science.”
The so-called Angel investors were still business people, and expected a profit in return, said Moshoane. However, with the biotechnology only expected to deliver profits within 20 years, Moshoane said it was necessary to look at the European market for assistance, to encourage investment in the sector.
“The impact of biotechnology can only be seen in maybe 20 years after an investment, but we need to learn not to take 20 years. If the Europeans have taken 20 years, this should help us to accelerate that ramp-up to get into commercial networks.”
Although relatively scarce on the ground, Moshoane said that Angel investors did exist, but that the individual investors had no current South African network to facilitate interaction. This, he said, was where eGoli Bio could assist.