Government officials hope to build a biotechnology industry with a production value of NT$150 billion (US$4.5 billion) by 2006 -- triple the current value.
Biotechnology is seen as an important part of an overall plan to develop industries meant to replace the information technology manufacturing companies migrating to China. Investment across the Taiwan Strait has risen as the economic downturn has forced companies to pare costs and boost profits.
The local biotech sector will have to grow by NT$50 billion every two years to meet the government's goal. The sector earned NT$49.5 billion for Taiwan last year, with products ranging from bio-chips and protein drugs to medical equipment, according to Alex Fang (
About NT$22.5 billion accounted for "pure" biotech products last year, while medical-equipment sales made up the remaining NT$27 billion.
Pharmaceutical products, which are treated as a separate category, reached NT$51.4 billion in sales last year, ministry statistics show.
The government has set aside NT$52 billion to develop the industry. NT$12 billion was spent last year to upgrade facilities at Academia Sinica and develop university programs, build research centers and attract talent. Over the next four years, the remaining NT$40 billion will be dispersed at a rate of NT$10 billion per year.
The Executive Yuan's Development Fund (開發基金) has also been tapped to help build a homegrown biotech industry by adding some NT$30 billion to the pockets of local venture capital firms, with incentives if they invest in local biotech start-ups.
The fund would be combined with NT$70 billion, which must be 30 percent government capital and 70 percent private, a Cabinet official said.
Any fund investing 20 percent of its total cash in a Taiwanese biotechnology company would be allowed to invest the remaining capital overseas, while funds investing in other sectors would be required to invest 50 percent locally and the remainder could be used abroad.
The Development Fund is charged with providing seed money for new industries, such as TFT-LCD panel production and semiconductor design. There are already 36 investments in the Development Fund portfolio.
In rival Singapore, the Business Times newspaper reported that the city-state has channeled more than US$700 million into biotech funds since 2000, including US$568 million for biomedical sciences and US$120 million for other initiatives.
Singapore's Agency of Science, Technology and Research has also allocated US$857 million for biotechnology R&D and another US$1.13 billion for biotech start-ups and overseas investments in the sector.
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