For Normand Balthazard, the two most important factors in finding an Asia-Pacific partner for the medical technology and pharmaceuticals in his company's portfolio are expertise and commitment.
"I've got the technology -- proven technology," said Balthazard, president of BioCapital, a Quebec-based venture capital firm. "We're looking for a partner in Asia who will say, I know the Asian market and I'll invest US$20 million [in it]."
North American biotech companies have emerged from a decade long research hibernation pumped with drug products and starved for cash -- and going global is the best way to recoup the US$700 million or so required to bring a new medicine from the lab to store shelves.
Venture capital firms often wait up to seven years for an investment return in biotechnology. Big investment returns make the wait worthwhile, but companies have to develop new markets fast -- the five to seven years it used to take for competing medicines to enter the market has more recently been reduced to two.
To move fast on the market, Balthazard wants to bring BioCapital's medicines to Asia through a partner, and he says Taiwan ranks higher than mighty Hong Kong for biotech joint ventures.
"Hong Kong is more a UK-based collaboration and when you go out of Hong Kong -- you can't do biotech in Hong Kong -- doing business in Shanghai or Shenzhen or where ever, it's complicated," Balthazard said. "Taiwan has a certain history of collaboration with North American companies."
Taiwanese companies have invested worldwide in the life sciences, including the "Quebec Corridor," a Canadian biotech haven near Montreal.
Although Balthazard was attracted to "the strong will on the part of Taiwan to seek biotech partners and investment," his tour includes Singapore and partners from BioCapital are in Japan. Taiwan is not a sure thing.
And if his presence in Taiwan along with a number of French biotech investors currently in town is any indication, this is only the "first of a wave of Western firms" ready to hit the road and peddle their wares.
Foreign industry analysts in Taiwan say the nation could become an excellent partner for a number of reasons, but a small local market and relatively weak development of the home-grown biotechnology industry threatens to leave Taiwan in the dust of better equipped nations in the region.
"There are a lot of highly qualified people here, highly-educated scientists trained in Western Europe," said Philippe Auvaro, chairman of the European Council of Commerce and Trade's Pharmaceutical Committee.
Overseas work and study has prepared the nation with a number of biotech scientists with "a collaborative mindset and broader networks to move from" superior to even Japan, according to Auvaro, who spent 10 years there before transferring to Taiwan with major European drug maker Aventis.
But although full of praise for the local biotech effort, Auvaro points out the lack of advanced research and a small local market -- worth US$2 billion annually -- are sore spots in Taiwan's bid to attract biotechnology joint ventures and other investment.
The hard work Taiwan has put into developing the information technology industry here has concentrated for many years on the OEM (original equipment manufacture) model, building products based on the research of foreign partners. Many current government policies support taking the same OEM model and applying it to pharmaceuticals, creating factories dedicated to pumping out medicines developed elsewhere. But applying the model to biotechnology will cause Taiwan to lose out on "the big money," say industry pundits. The government here needs to focus on research and development, not on OEM.
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