South Africa recently claimed a victory. In May, it won the right to host the world’s biggest radio telescope. The $2 billion project, said Derek Hanekom, Deputy Minister of Science and Technology at BIO’s ‘The BRICS and Beyond’ special session (June 18) sent out a sign that the country has left behind its troubled past and is ready for business. Beyond astronomy, and its azure skies, South Africa is a market poised for growth and a gateway to the rest of the continent.
Over the last 20 years, the government has embraced “innovative thinking,” said Hanekom. While addressing poverty issues, and providing help for the 5.6 million people who are HIV positive, the state has come up with game plan to spur the economy. South Africa, as most other BRIC countries have done before, is embracing the idea of a Bioeconomy as an engine for growth. The state sees potential in genetically modified crops for pest and drought resistance and grasses as cellulosic material for second-generation biofuels. Exploiting algae is also high on the agenda, in the short term, as a source of protein for animal feed, and in the long term as a biofuel.
In healthcare, the state is prepared to lend more than a hand to fledgling companies. Plans to support biotech growth were set in motion in 2002, when the government’s Technology Development Agency set aside a 500 million Rand (US$60.8 million) technology development pot per year, 200 million rand (US$24.4 million) of which is dedicated to the biotech sector. “It may not seem much by US standards, but compared to other African countries, it is significant,” Sibongile Gumbi, group executive for the biotechnology sector, at the Technology Innovation Office said at a press conference also at BIO.
South Africa’s biotech drive is such that the state is willing to incubate, support development, and even commercialize any product that makes it to market—whatever is needed. Currently small and medium enterprises (SMEs) include biopharmaceuticals, phytopharmaceuticals and diagnostics. “We’d like to get into vaccine development,” said Gumbi. One South African drug discovery company, Ithemba, in Gauteng, is an SME dedicated to discovering inexpensive therapeutics for infectious diseases through synthetic and medicinal chemistry. With support from the state, Ithemba is running a tuberculosis program in partnership with the University of Georgia in the US.
The government is also keen to attract outside companies to manufacture locally. “South Africa benefits from strong IP laws,” said Gumbi. “It is also a way for us to gain knowledge. If we were able to attract biomanufacturing expertise, that will be of significant benefit to our sector.
Lisa Melton
Hi Brady,
in 2012 South Africa’s GDP will be in the order of R3 trillion. R200 M will be in the order of 0.000007% of GDP.
Recently, series A VC investments in biotech were in the order of $13M, i.e.about R 107M. So, give or take, the R200M could give us 2 proper biotech companies a year (Brady Huggett (2012) Biotech’s wellspring: a survey of the health of the biotech sector. Nature Biotechnology, 30, 2012).
How do these figures compare to those of other emerging economies at BIO?
Can the SA presentation be found online?
Rgds,
Reinhard
Reinhard, hi, I am Brady’s colleague, Lisa. I agree, the investment seems small, but I was the only person sitting at a press conference organized by South Africa’s Technology Innovation Agency, and there was no presentation, so I cannot reference it. My impression from the TIA spokesperson is that the agency sees its role maily as a catalyst for strengthening local capabilities. The ultimate aim is mostly, though not exclusively, to attract foreign investment and partnerships. Perhaps the funding could be seen as a good starting point? Lisa Melton
I wish I weren’t so cynical, but we have just seen an effective collapse of government biotech funding following the merger of the three Biotechnology Regional Innovation Centres (BRICs) – which were JUST starting to function properly and actually FUND things – into the Technology and Innovation Agency, which does neither.
If you add to that the fact that the National Research Foundation has ceased to effectively fund basic science in this country, statements like “the state is willing to incubate, support development, and even commercialize any product that makes it to market” are actually derision-provoking, because nothing WILL make it there, if there are no funds to develop it!
It is also interesting that ““We’d like to get into vaccine development,” said Gumbi”: really? And they are doing what, exactly, to get into that? Oh, there is a report on the state of vaccine manufacture, and prospects for it in South Africa, but writing as someone involved in actually trying to make vaccines, I can tell you that despite our best efforts, and memorandum after memorandum, nothing appears to happen, at any level.
I hope I’m wrong: I hope a thousand funding opportunities bloom; I hope a myriad calls to develop innovative biotech products are made, and soon.
But I’m also cynical.
Ed, it is true that political intentions don’t always sit comfortably with biotech business. But most BRICS wanting to spur the biotech industry are doing so backed by public money, and their expectations are high. China’s goverment, for instance, is committed to biotech and hopes that by 2020 biotech revenue will exceed $300 billion (Nature Biotech 29, 779, 2011). It is big money, indeed, but their goal seem a touch unrealistic. For countries with small money pots, like South Africa, expectations might be similarly optimistic. One can only hope that whatever funds are available, the goverment agencies will keep red tape to the minumum, and make wise choices on how to allocate the funds. From what you say in your post, the TIA may need to take a careful look. Lisa