SA`s small biotech industry poised for growth

Johannesburg, 22 Sept 2003

The first National Biotechnology Audit, compiled by the Idea to Industry Team, has confirmed that the local biotechnology industry is small by international standards, but at the same time suggests that it is poised for bigger things.

The audit, co-funded by eGoli BIO Life Sciences Incubator and the Department of Science and Technology, found that revenues for 48% of products and services in the local biotechnology industry totalled R368 million in 2002.

Additionally, total spending on biotechnology research and development (R&D) exceeded R293 million for the same period.

This is in comparison to Ernst & Young`s Global Biotechnology Report 2003: Beyond Borders, which indicates that approximately 600 publicly traded biotechnology firms globally reported revenues totalling $41.3 billion and R&D expenditure of $22 billion at the end of 2002.

"Despite its small size, the industry has a substantial number of potential new products and processes in the research and development stage," says Dr Paul Abrahams, CEO of eGoli BIO.

According to Abrahams, the key goal of the audit was to quantify the South African bio-economy in terms of the number of companies, annual turnover and revenues from products and services.

It also set out to develop a comprehensive database of companies, tertiary education institutes and other public or private sector research-based organisations involved in biotechnology in SA.

The local audit identified 106 companies participating in biotechnology activities, 47 of which are classified as core biotechnology companies. In addition, 59 non-core biotechnology companies were identified with the majority being situated in Gauteng (38%) and the Western Cape (37%) and active in the plant biotechnology sector (26%).

"The key point of the audit is that it can serve as a qualitative and quantitative benchmark from which the future growth and development of the industry can be measured, particularly in response to several recent government interventions in the industry," says Abrahams.