Why “The New Zealand Advantage?”
Two recent media releases were categoric that New
Zealand holds the number one global position for agricultural biotechnology
research and development. The NZBio conference held recently in Auckland
also followed through on this theme, with both international and local
speakers expounding our natural, technological, social and regulatory advantages.
BioPacific Ventures launches $150M venture capital
fund………
“And now, the Oscar for biotech”, Liam Dann,
NZ Herald reported.
The team at AgResearch and Direct Capital have
pulled off a Peter Jackson-sized coup for this country. Raising $150
million to fund exciting new agricultural science projects is a wonderful
effort in itself.
But what makes the BioPacific ventures fund
so important is that it has attracted international biotech heavyweights
to New Zealand for the first time.
For years, we’ve been telling ourselves we lead
the world in agricultural science.
We’ve had plenty of proof of our success in
the product ion gains made by dairy and meat farmers.
We’ve developed world-class apple varieties
and bred the kiwifruit into one of the most popular fruit on the planet.
But we have struggled to sell our story to international
investors.
New biotech companies have struggled to survive.
Now, like our film makers and special-effects
wizards, our scientific companies are going to get the chance to shine
on the global stage.
It is impossible to put a price on the buzz
this fund could generate.
The Swiss-based venture capital company Inventages
is young and dynamic with a good reputation around the world.
They are also hard-nosed about making money
in a tough industry.
By staking their claim here, they have put us
in the map.
Suddenly, biotech fund managers in Asia and
the US will be asking what is so interesting that has attracted a bunch
of Swiss guys down here.
Let’s hope they’ve started an investment rush.
“NZ’s GM regulations on world stage”, ERMA Perspective
American journalist Stephan Herrera recently
visited New Zealand to document our Governments stance on genetically modified
organisms for the publication of technology Review.
In an article entitled ‘New Zealand: Green haven
for Biotech?’ Herrera says that in the USA, firms developing GMO’s
are disadvantaged by rules that are frequently ill defined, difficult to
implement and hotly contested.
Herrera believes it’s New Zealand ‘of all places’
that may have the solution. He says that in ‘order to produce more
(or more valuable) dairy and forest products on less and less acreage’
our Government decided to accept GNO technologies and ‘manage them wisely
with a transparent, enforceable, publicly accessible and scientifically
robust regulatory framework’.
The [Technology Review] article acknowledges
that many environmentalists are dubious about the protocols surrounding
GMO’s, but points out that biotech firms consider the process costly and
time consuming, but says New Zealand’s GMO regulations are now considered
among the worlds most functional. He also quotes a veteran biotech
investor from San Francisco “Now anybody who is investing in agbio is paying
attention to New Zealand”.
The feared international backlash against exports
from New Zealand has not materialised, according to Herrera. “It’s
too soon to know whether New Zealand’s new regulations will pay long-term
dividends. New Zealand expects continuing growth in global demand
for its leading exports, forest and dairy products”.
In the article, Herrera quotes Jeffrey Turner,
CEO of Canadian biotech company Nexia as saying “There could be a huge
advantage for some companies to develop their technologies in New Zealand
now, because the country’s regulatory protocol is seen as extremely robust
and politically legitimate”.
INVESTING IN NZ COMPANIES
Roger Wyse from US investment strategist Burrill
& Co, described the US scene where traditional US drug companies’ share
prices and confidence is declining. A lot more emphasis is being
placed on the gene system and understanding ‘systems biology’. He
said New Zealand is well placed to take advantage of this trend.
NZ companies are already looking at bioactives in the health and wellness
market. HortResearch has a diverse garmplasm and bioactive discovery
programme, however, commercialisation remains the challenge.
Australian biotech information consultant Lyndal
Thorburn described New Zealand’s strong Ag Biotech sector. There
are approximately 76 NZ Ag Biotech companies with about 4700 employees.
Consider the size of the NZ Ag Biotech industry against major (local) competitors
China, Japan, Taiwan and Singapore. Japan has a 10 plan to start
1000 more biotech companies by 2010. Taiwan are already the third
largest (by company) biotech nation and Singapore have demonstrated that
government funding in their Biopolis Hub is now attracting outside investment.
NZ may find it difficult to compete without government policy and investment
direction, however, because of our strong Ag biotech sector, we are focussing
on an area our competitors are not.
BioPacific Ventures’ Erich Sieber said New Zealand
has a world class research base and undertake research at 50% of the cost
of the US or EU. That associated with our natural advantage and our
regulatory stability, NZ Ag Biotech companies have created a global interest
in “green biotech” where plant health, sustainability and productivity
research have meant a move away from the “GM technologies” of the past.
LEVERAGING NEW ZEALAND’S AG BIOTECH STRENGTHS
The dairy industry has a natural advantage with
a process product that lends itself to many Ag Biotech applications.
Functional foods were often talked about during the conference, an area
our industry is researching through its Vital Vegies project with Crop
and Food Research and Horticulture Australia.
One such functional food additive are probiotics
– micro organisms, when administered, give health benefits. A common
probiotic is lactobacillus in yoghurt. Trials of the lactobacillus
probiotic called DR20 released by Fonterra showed rats were given increased
immunity against salmonella. Rats that were not given DR20 died from
salmonella infection!
HortResearch are undertaking studies in the industrial
benefits of “plant volatiles” – the smell from flowers and plants, which
also describe the plants’ natural protection abilities. This work
will help to understand what makes up the plants’ natural defences.
Animal researches estimate that 50% of New Zealand’s
increase in value and production from Ag Biotech will be due to the gene
pool built up in NZ over the generations. It is the leverage from
this gene pool which is the New Zealand advantage!
Dr Tony Conner from Crop and Food Research, Lincoln
described some very clever developments which may mean that public concerns
from the past should be reduced. Micro translocation is the building
of a recognisable gene sequence of a desirable trait from within the desired
plant, without having to import gene material from outside. Many
public concerns have been generated from the concept of the foreign-gene-in-food.
This is no longer needed as the genome sequences from many more plant species
are being mapped, researches can find their desired gene sequence within
the plant they are working on. They can even go one step further.
They can take bits of the gene sequence and join them together, still all
from the same plant. All this results in highly precise and highly
targeted breeding from desired traits.
New Zealand researches and Biotech companies are
getting known for their ability to think outside of the square. Many
relate this ability to New Zealand’s physical isolation and the apparent
lack of influence other countries may have on us. It is the no.8
wire mentality where necessity is the mother of invention. Conan
Fee from Waikato University described a shift in thinking that could turn
parts of the NZ dairy industry on its head to satisfy a niche. He
described on-farm processing rather than centralised, bulk processing,
meaning there were no temperature variations and resulted in the ability
to extract far more and far higher quality proteins from the milk.
The value of the protein extracted per average farm was predicted to range
from $220 to $660 per day, while the milk solids (the traditional way of
payment) processed centrally, would pay around $150 per day.
The desire to extract more value out of the primary
product could result in an alternative way of doing things – that is the
New Zealand Advantage.
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