Good basic conditions for a functioning biotechnology cluster
How well business development and location promotion in Baden-Württemberg works can be seen in the example of the future-oriented biotechnology sector. In the two major nationwide competitions BioRegio and BioProfile Baden-Württemberg was the only State with regions that won in each competition.
According to a study by the Boston Consulting Group there will be about 1.2 million highly-qualified jobs in the biotechnology field throughout the world by 2010. Added value of more than 400 thousand million Euro is expected. Such an immense growth market simultaneously means the creation of new jobs – and we can never have to many of those in Baden-Württemberg.
The Baden-Württemberg state government therefore has a great interest in establishing a competitive biotechnology industry here for the long term. A well-functioning biotechnology cluster – a collection of scientific facilities and companies of various sizes in close proximity to each other – needs good basic conditions. In this article I want to look at these basic conditions in more detail.
The main building of the German Cancer Research Centre in Heidelberg.
The proximity to biotechnology-oriented research centres is one of the crucial factors for a well-functioning biotechnology cluster. In Baden-Württemberg bioscience-oriented research groups are working at no less than eight universities and 18 private research centres. These include such internationally renowned institutions as the German Cancer Research Centre and the European Laboratory for Molecular Biology in Heidelberg and the Max Planck Institute of Developmental Biology in Tübingen. Seen as a whole, Baden-Württemberg is a scientific centre of excellence for the whole spectrum of the biological sciences. In order to expand this basis the State Government has started numerous initiatives to assist biotechnology in the last three years:
• three bio-science centres are being established at the Universities of Heidelberg, Freiburg and Ulm. These three new projects with a total investment value of 61 million Euros will be financed with assistance from the State Government to the
value of 30.5 million Euros as part of the Future Offensive III programme;
• a new building for the Centre for Molecular
Biology of Plants at the University of Tübingen is being made possible with some 12 million Euro from the state government;
• the state government is assisting the competence Baden-Württemberg Bio-Materials Network with a subsidy of 2.6 million Euro;
• it is assisting the establishing of interdisciplinary centres for bio-information science with 7.8 million Euro of state funds;
• the Biotechnology Subsidy Programme for risky SME’s research programmes will be subsidised with 2.5 million Euro annually;
• the Baden-Württemberg State Foundation will make 7.5 million Euro available for the research programme into adult stem cells;
• another 29 million Euro will be made available as part of the latest state bio-technology offensive for non-profit research subsidy programmes by the Baden-Württemberg State Foundation;
• in a rolling laboratory – a project of the Baden-Württemberg State Foundation – teachers and pupils at 12 group places of work can familiarise themselves with the working methods of modern life sciences.
Boehringer Ingelheim Pharma GmbH & Co. KG. in Biberach an der Riss _ left: the production of new bio-pharmaceutical substances; right: Protein cleaning is one of the essential steps in the production of bio-technical medications.
These are all important new stimuli for the preservation and expansion of the Baden-Württemberg biotechnology location. But even good research such as this will not achieve its aim if the research results are not transformed into products and processes. Assistance to those wishing to start up their own firms direct from university has proven to be a very effective method. With the “Young Innovators” and the “Start-Up Alliance Programmes on Campus” 42 biotechnology firms have been assisted so far. Numerous institutions such as the university technology transfer offices, the Technology Licensing Bureau in Karlsruhe, the Patent Information Centre and the Steinbeis Foundation assist scientists and businessmen to market the results of research. Assistance to joint research projects is an essential instrument for improving technology transfer. Seven biotech projects will be subsidised with a total of 6.3 million Euro from the Joint Research Programme, which is part of the Future Offensive III and whose first phase has been financed with 20 million Euro.
The Tübingen-Reutlingen Technology Park, one of the most modern start-up centres for bio-technology.
But for young entrepreneurs the choice of a location, low-cost laboratories and workspace – if possible in the centre of a cluster – are of crucial importance. Assistance to bio-parks by the Baden-Württemberg state government has proven itself to be a very successful instrument here. Between 1997 and 2002 the state has made some 12 million Euro in subsidies available for bio-parks in the four bio-regions. These investments have created some 70,000 square metres of laboratory and office space. Besides the low rents the young companies benefit especially from integration in a multi-layer network of companies, research centres and advisory services.
One of the essential bases for the favourable development of biotechnology is without doubt our successful concept of the four bio-regions in the Rhine-Neckar triangle, the Stuttgart-Neckar-Alb, Freiburg and Ulm. Through its victories in the two major national competitions BioRegio und BioProfile alone the success of this concept becomes apparent – initially with the victory of the Rhine-Neckar triangle in the BioRegio in 1996. The 50 million DM prize was one of the most important stimuli for the success story of this bio-region, which has since achieved worldwide significance.
We are hoping for a similarly positive development in the STERN bio-region following its success in the national BioProfile competition in 2001. The Bioregio STERN – a merger of the two regions Stuttgart and Neckar-Alb – has held its own as one of the three winners in a national competition against 30 tough competitors with the profile “Regenerative Biology”. As well as the 35 million DM federal subsidy the companies involved also have the use of a similar amount of their own funds.
In the traditional field of pharmaceuticals alone there are opportunities for biotechnology in an immense market. Biotechnology is currently responsible for some 20 per cent of total added value in the international pharmaceuticals market. For 2010 it is currently estimated that some 40 per cent in the international pharmaceuticals market will be based directly on biotechnology. Such expected growth seems wholly realistic given the fact that 41 per cent of international patent applications in the field of pharmaceuticals are directly related to biotechnology today.
Baden-Württemberg has the best chances of participating in this growth. Thirty-three pharmaceuticals companies in Baden-Württemberg with a total of more than 20,000 employees are already active either exclusively or partially in biotechnology.
Again and again it is especially young companies, which have their origins in university research activities, that bring essential innovative stimuli for new effective ingredients. The cooperation of these small, innovative bio-tech companies, of which we have located 140 to Baden-Württemberg currently, is the basis for the transformation of bio-technical knowledge into medications.
In the pharmaceuticals industry nationally, Baden-Württemberg occupies the absolute top position. Measured by the number of employees, firms and sales we are at the fore. Some 22 per cent of all employees in the German pharmaceuticals industry work in Baden-Württemberg.
This location advantage must also be used for biotechnology. There are immense opportunities for a closer inter-linking of pharmaceuticals companies and innovative biotechnology companies.
As we already know, the sobering results of the adventures on the New Market have since led to very cautious and reserved investment policies in venture capital funds. So at the moment the State L-Bank with its L-Eigenkapital-Agentur (L-Equity Capital Agency, or L-EA) is gaining considerably in importance. The L-EA Venture Fund invests overwhelmingly in early-phase companies and is currently participating in nine bio-tech companies. The State-owned company BIOPRO GmbH, which was founded at the end of 2002, is part of the latest state biotechnology programmes. As a state-wide service and marketing company BIOPRO provides targeted support to research centres and companies in the biotechnology and life sciences field.
The opening of Baden-Württemberg’s “BioLab on tour” at the Stuttgart Schlossplatz on 4 April 2003.
The state of Baden-Württemberg has placed its hopes in biotechnology and the life sciences and,
thanks to the achievements of its companies and efficient bio-regions today, occupies top position among bio-tech locations in Germany and is also positioning itself more strongly all over the world.
Working in the laboratory in the BioLab.
of Baden-Württemberg will exhaust all opportunities
to assist as well as it can this future-oriented field
in which we have placed much hope.