Bioeconomy Initiative Malaysia 2011 (1)

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BIOECONOMY INITIATIVE MALAYSIA

Transcript of Bioeconomy Initiative Malaysia 2011 (1)

Page 1: Bioeconomy Initiative Malaysia 2011 (1)

BIOECONOMY INITIATIVE MALAYSIA

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INTRODUCTION

The biotechnology industry is an increasingly significant economic

contributor to leading Asian countries such as Japan, China, India, South

Korea and Taiwan. Developing countries such as Singapore, Philippines and

Thailand have also incorporated biotechnology into their long-term growth

strategies and national development roadmap. Malaysia, through its

National Biotechnology Policy (NBP) is among the leading Asian countries

coordinating and intensifying a national effort in maximising the potential

economic benefits of the entire biotechnology ecosystem and related value

chains.

WHAT IS THE BIOECONOMY?

The Bioeconomy refers to all economic activity derived from scientific and

research activity focused on understanding mechanisms and processes at

the genetic and molecular levels and its application to industrial process.

Bioeconomy activities involve application to agriculture, health, chemical,

energy industries and many others. It covers all industries and economic

sectors based on the values implicit in biomaterials that can be translated

into new income and social well being and at its core is its focus on

sustainability.

Food and energy security

Design treatment for human diseases

Minimising climate change

Biotechnology offers technological solutions to future global challenges

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BACKGROUND

The basis of the Bioeconomy is advanced knowledge in the life sciences and

biotechnology supported by ICT, nanotechnology, chemistry, physics,

engineering, information technology and market research. The Bioeconomy

to 2030: Designing a Policy Agenda report published by Organization for

Economic Co-operation and Development (OECD) estimates that

bioeconomy will contribute a global average of 2.7% to Gross National

Income (GDP) and the discoveries of 10-14 new drugs per year over the

next 5 years and will be responsible for 10% of chemical production by

2030.

The first phase of NBP recorded industry investment exceeding USD 1.3

billion (RM 4.5 billion) in which more than 40% contributed by the private

sector. Contribution to GDP is estimated to reach 2.2% by the end of 2011.

More than 50,000 workers in this field and in related fields were recorded

in 2010. The figures suggest an industry with a promising potential for

having a high impact on GDP and GNI growth.

RATIONALE

Malaysia has an appropriate basis to become a global bioeconomy hub

based on a number of factors listed in the annual report of the Malaysian

Biotechnology Country Report 2009/2010 and Malaysian Biotechnology

Statistical Indicator Report 2010. Some of these factors is the support by

the government on the biotechnology sector, the implementation of positive

policies, good infrastructure, natural resources, biodiversity and strategic

location.

Bioeconomy will be a “sustainable economy” for Malaysia as it encompasses

all industries and economic sectors that produce, manage and utilise

biological resources such as agriculture, forestry, fisheries, food, wellness,

chemicals and renewable energy. Although based on knowledge and

innovation in biosciences, bioeconomy converges with other economic

sectors/technologies i.e. engineering, computer science, chemistry and

nanotechnology, and cross-cuts into public and private sectors.

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Endorsed by the Biotechnology Implementation Council, chaired by the

Honourable Prime Minister in May 2011, the Bioeconomy Initiative

Malaysia will consolidate and converge to maximise participation of local

private industry in the high-impact opportunities in bioeconomy and

ensuring continuity and implementation of all related national policies.

The rationales for Bioeconomy Initiative Malaysia (BIM) are:

Recognising biotechnology as a key cross-cutting technology driver in

transforming Malaysia into high income economy;

The need for consolidation and convergence of many bioeconomy

initiatives in multiple sectors to maximize local participation from both

public and private domains;

To tap into the unrealised application of locally developed technologies

and discoveries;

Reconciling the urgent need to focus on technology that utilises

renewable resource; and

A comprehensive bioeconomy initiative anchored by the National

Biotechnology Policy and linked with other related policies.

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FRAMEWORK OF BIOECONOMY INITIATIVE MALAYSIA (BIM)

"Green" Chemistry

Biocatalysts

Bio-generic Manufacturing

Advanced Bioprocessing

Technologies for Fine & Specialty

Chemical and Biomaterials

Vaccines Biogenerics

Biobanking Molecular

Diagnostics

Development of Agricultural

Biotechnology Centres of Excellence

Adding Value to Crops & Foods

Marine Biotechnology

Initiative

Natural products discovery and

commercialisation

Industrial Biotechnology

Healthcare Biotechnology

Agriculture Biotechnology

AREAS UNDER NATIONAL

BIOTECHNOLOGY POLICY

Other

related

policies

Other

related

policies

Other

related

policies

Other

related

policies

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Bioeconomy Initiative: Related EPPs

Proposed projects with direct bioeconomy impact

Existing EPP with direct bioeconomy impact

Existing EPP with indirect bioeconomy impact

Herbal products

Aquaculture

Crop

Breeding services

FDI in agriculture

Livestock

Biofeed

Extracts

BioControl

Biofertilizer

Pharmaceutical generics

Clinical trials

Genomics

Biosimilars

Food- and health-based downstream

Green technology

Oleo derivatives

Industrial biotechnology

Medical devices

AGRICULTURE

HEALTHCARE INDUSTRIAL

Legend :

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Linkages to Industry

Key Activities/Deliverables and Timeline

A. Extracts

B. BioFeed

C. BioControl

D. BioFertiliser

E. BioSimilar

F. Genomics

G. Industrial

Biotech

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BIOECONOMY OPPORTUNITIES

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1) Bioextraction: Increase Capabilities of Extraction Facilities

a) Justification

The Asia-Pacific Active Bio Compound market revenues will grow

at a CAGR of 9.6% from 2010 to 2016.

The high potency Active Bio Compound segment is showing

attractive growth opportunities for the pharmaceutical players. A

number of companies are expanding their facilities for the

production of Active Bio Compound.

A number of contract manufacturers are coming up with high

potency manufacturing capabilities. There is an increasing trend of

contract manufacturing being used in the high potency segment.

b) Targeted result in 2020

Products • High Value Active Pharmaceutical Botanical Drugs -Polypeptide K from Momordica charantia sp

• High Value Active Bio cosmetic ingredient –Xanthones from Garcinia mangostana

• High Value Active Health Supplementary ingredients– Marine Collagen peptide from Tilapia spp

Targeted Output Year Output

2012 2013 2014 2015 2016 2017 2018 2019 2020

Active Compound

1 - - 1 - - 1 - -

Application 2 3 1 2 2 1 2 2 -

Generic Products

10 10 15 10 10 15 10 10 10

Outcome • New domestic high value standardized active compound for pharmaceutical, food and cosmetic industry (100 products)

• Value add the locally sources standardized active compound (reduce import dependency on the active ingredients)

• Increase life expectancy and healthy community (refer to future health trend analysis)

GNI Estimated USD 240 mil (RM 720 mil) until 2020

Jobs Created 10,500 jobs in manufacturing, lab analysis, marketing, plantation

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c) Key Activities/Deliverables and Timeline

2) Bioextraction: Strengthening Mushroom Seed Production and Introducing

New Varieties

a) Justification

Globally, mushroom industry is worth RM 135 billion (2005).

Mushroom with its natural ascendency in term of dietary

supremacy can be the primary functional food.

Fungi from the Basidiomycota received great interest because it

contains large number of biologically active compounds such as

polysaccharides, glycoproteins, triterpenes and antibiotics.

Potential to lower cholesterolemia, modulate the immune system

and inhibit substances are able tumoral growth, protect liver, anti-

fibrotic, anti-inflammatory, anti-diabetic, anti-viral and

antimicrobial activities.

However, nutritionals and functional properties of indigenous

mushroom in Malaysia is scanty and poorly known.

This shortfall is due to limited effort in exploiting the economic

potential of indigenous mushroom and establishing a

bioextraction facility.

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b) Key Activities/Deliverables and Timeline

3) Bioingredients: Uncovering Natural Bioresources to Develop Bioingredient

a) Justification

Malaysia is one of the 12 megadiverse countries in the world and

is rich with unexplored natural resources.

Malaysia is a strategic country to accommodate global food

ingredients market which has an estimated of RM 72 bilion (USD

24 billion) in 2010 and grows at approximately of 3-5% annually.

Current trend in increasing health awareness and food safety are

influencing the reformulation, detection advances, and more

stringent regulatory safeguards in food ingredient industry.

The turning point in stevia’s fortunes came in 2008, when steviol

glycosides (the sweetening components of the leaf) were deemed

to be safe, and Rebaudioside A, one particular steviol glycoside, was

granted GRAS (Generally Recognised as Safe) status in the US.

Stevia herb in its natural form is approximately 20-30 times

sweeter than common table sugar.

Extracts of Stevia can range anywhere from 100 to 300 times

sweeter than table sugar.

Stevia also being used as medicine, cosmetic ingredient, and

dentifrice.

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It is estimated global market for Stevia will reach 11,000 metric

tonnes by 2014, equivalent to USD 825 mil.

The aim is to strengthen the production, product quality and

marketing efforts to penetrate global export markets for functional

ingredients: Reb-A from Stevia rebaudiana Bertoni.

b) Targeted result in 2020

Products Plantation of Stevia (PC1 strain), Stevia crude extract Targeted Outputs

500 ha of stevia plantation & 500 MT of stevia crude extract

GNI RM 43 million Jobs created 800 jobs

c) Key Activities/Deliverables and Timeline

4) Biofeed: Production of Quality Feed with High Density for The Local

Aquaculture Industry

a) Justification

Globally, aquaculture contributed 48 per cent of aquatic food in

2010.

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Live feed plays a crucial role for the success of any aquaculture

activity - is essential for the early developmental stages of the life

cycle of aquatic organisms.

Local seed industry is facing a setback of continuous and

consistent supply of quality live feed to sustain the aquaculture

seed industry.

This shortfall is due to limited effort in exploiting the economic

potential of local live feed and establishing the production of live

feed in commercial scale.

Annual import value of artemia cysts is reported at RM 4.5 million

and is expected to increase 6-10 folds within 5 years.

Realising the economic importance of live feed and capitalising on

Malaysia’s biodiversity advantage, hence live feed production

should be pursued as a new industry through bioeconomy.

b) Key Activities/Deliverables and Timeline

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5) Biocontrol: Development of Biopesticides for Major Agricultural and

Industrial Crops in Malaysia

a) Justification

Biopesticides are defined by the US Environmental Protection

Agency (EPA) as pesticides derived from natural materials, such as

animals, plants, bacteria and certain minerals.

The EPA defines three kinds of biopesticides: microbial, consisting

of microorganisms; biochemical, which are naturally occurring

substances such as extracts and pheromones; and plant-

incorporated protectants, which are substances that plants

produce from genetic material added to the plant.

Biopesticides market is growing rapidly, increasing from USD 672

million in 2005 to over USD 1 billion in 2010, at an AAGR of 9.9%.

In Asia, the biopesticide market was USD 120 million in 2010, an

AAGR of 12% between 2005 and 2010.

The biopesticide market generally (including botanicals, semi-

chemicals and macro- or micro-organisms) was worth

approximately USD 1 billion in 2007/8; approximately 2.5% of the

USD 40.5 billion pesticide market (agrochemical sales estimate for

2008). *CPL Business Consultants.

Advantages of Biopesticides:

Safer and more effective compare to conventional chemically

synthesized pesticides.

Minimum resistance towards biopesticides.

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b) Key Activities/Deliverables and Timeline

6) Biofertiliser: Converting (low-value) Agrowaste into (high-value)

Biofertilizer

a) Justification

Most of the Malaysian soils are highly leached infertile acid

tropical soil and the application of fertilizer with high organic

matter is essential to support crop cultivation.

With large tracts of land cultivated with perennial crops such as

palm oil and rubber, substantial quantities of fertilizers are

required annually to sustain maximum growth and yield.

Continuous and excessive application of chemical/mineral

(fertilizer and pesticide) causes extensive soil deterioration and

elimination of soil macro and micro fauna.

Under the 3rd National Agricultural Policy, organic agriculture is

being identified as a niche market opportunity for vegetables and

fruits. Due to the promotion by the government for more

sustainable use and better management of the available natural

resources, the use of organic- and bio- fertilizers has gained

popularity.

Organic fertilizer are naturally occurring fertilizer which include

manure, slurry, worm casting, peat and seaweed; whereas,

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processed organic fertilizer include compost, humid acid and

amino acid.

Generally, an organic fertilizer provides organic matter which is

essential for the establishment of soil microorganism and is one of

the building blocks for humus rich fertile soils. Naturally occurring

soil microbes will convert the organic matter into its mineral form

(nutrients) ready for plants.

Biofertilizer, as the name suggest, contains biologically active

living organisms that, both synthesize the atmospheric elements

into soil minerals as plant nutrient, and decompose organic

matters into its minerals. Biofertilizers may be in solid or liquid

medium, enriched with high microbial density (i.e. > 10000000/g).

Although the exact worldwide data for biofertilizer market is not

available, but from available sales volume, it is estimated to be

well over USD 3 billion.

In Malaysia, the sale recorded by major Biofertilizer producer is

estimated to be approximately RM 350 million (as of 2008).

Incorporation of biofertilizer with organic fertilizer is crucial to:

Improve soil fertility (with improved humid acid and amino

acid content).

Increase nutrient availability from the soil to the plants (i.e.

breaking down of organic maters into its minerals, ready for

plant uptake).

b) Key Activities/Deliverables and Timeline

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7) Biosimilar: Develop and commercialise biosimilar

a) Justification

A biosimilar is a copy version of an already authorized biological

medicinal product developed after its patent expired and with

demonstrated similarity in physicochemical characteristics,

efficacy and safety, based on a comprehensive comparability

exercise.

Not similar to generic drug (small molecule) because of its

complexity, larger size and difficult to produce exact copy.

Biosimilar is relatively a new area, started in 2006 with first

approval of Omnitrope, a version of somatropin in EU.

Currently 14 biosimilars already approved in EU.

Guidelines already in place: EU, Malaysia (2008), India etc.

Lower cost, shorter timeline, less risky than novel or innovator

biologics.

Biosimilars would provide an affordable alternative source

(estimated discount as much as 85%*) of biologics drugs.

Supply chain available in Malaysia (R&D, CMO, fill and finish

facility, distribution).

Fast growth (The global biosimilars market will grow from

USD243 million in 2010 to USD3.7 billion in 2015 (source:

Datamonitor).

More than 30 branded biologics with sales of USD 51 billion set to

lose patent exclusivity between 2011 and 2015. There is high

potential for growth of biosimilar industry.

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b) Proposed biosimilar products

Product EPO Herceptin (trastuzumab) Rituxan (rituximab) Remicade (infliximab)

Description Glycoprotein hormone produced in kidney

A humanised monoclonal antibody

A novel immunotherapeutic agent.

Chimeric monoclonal antibody

Indication Used clinically for conditions such as -anaemia in patients with chronic renal failure, -chemotherapy induced anaemia in cancer patients.

Targets a receptor that is overexpressed in tumor cells. Used as adjuvant therapy in patients with HER2 –positive breast cancer.

Non-Hodgkin’s Lymphoma, Chronic lymphocytic Leukemia (CLL), Rheumatoid arthritis.

Rheumatoid arthritis, Ulcerative colitis, psoriatic arthritis, Crohn's disease.

Off-patent Epoetin beta (2004). 2015 2015 2012 (US / EU)

Originator Amgen/ Kirin

Genentech Roche/ Biogen Idec Johnson & Johnson/ Schering Plough

World market *USD11 Billion USD4.1 Billion (datamonitor, 2007 sales)

USD4.6 Billion (datamonitor, sales 2007)

USD5.1 Billion (datamonitor, 2007 sales)

CAGR 10% 23% 15% 5 to 10%

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c) Key Activities/Deliverables and Timeline

8) Biosimilar: Securing strategic investment for the biopharmaceutical and

biologic projects

a) Justification

Lack of expertise and technology in this field.

No commercial manufacturing plant for biopharmaceuticals has

been setup in Malaysia yet.

b) Targeted result in 2020

Locally manufacture biopharmaceutical and biologic products.

Technology transfer and developing local expertise in the relevant

fields.

Creating job opportunities (approximately 450 employees per

company).

GNI contribution (approximately RM 218.1 million in 2020 which

is equivalent to USD 72.7 million).

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c) Key Activities/Deliverables and Timeline

9) Genomics: Bioinformatics And Healthcare genomics and proteomics

a) Justification

In 2010, the total global market for biomarkers was an estimated

USD 13.5 billion.

Global omics-based (proteomics, genomics) diagnostics

technology market in 2009 was USD 19.3 billion.

To pool the genome data together and easy accessible by the local

and private sectors.

High value project can attract FDI from companies involved in

diagnostics, personalized medicine, precision medicine, etc.

b) Targeted result in 2020

Estimated GNI contribution of RM 1 billion.

Jobs creation of 3,000 k-workers.

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c) Key Activities/Deliverables and Timeline

10) Industrial Biotechnology (IB): Alternative Energy Crop Production

a) Justification

Objective: To gradually reduce Malaysia’s dependence on natural

gas – a major input for Industrial Biotechnology and Malaysia’s

manufacturing sector as a whole.

The Malaysian Government has announced this year its

commitment to reduce subsidies on natural gas to manage the

country’s budget deficit. As a result, alternative sources of energy

must be explored.

Production and harvesting of energy crops is one of the most

viable alternative energy options for Malaysia. These energy crops

have not been fully explored in Malaysia.

Prime example of an energy crop for Malaysia is Acacia.

Low cost, low maintenance local plant with a 5-year planting cycle.

Woodchips can be used to generate steam.

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Currently on small scale and scattered across the country.

Other possible crop: Jathropa.

b) Targeted result in 2020

Plantation area of 7,000 hectares.

Steam supply to 3 strategic Industrial Biotechnology plants, valued

at USD 77.1 million in 2020.

GNI Impact in 2020 estimated at USD 65.8 million.

Employment of 760 workers.

c) Key Activities/Deliverables and Timeline

11) Industrial Biotechnology: Feedstock Production for Industrial

Biotechnology

a) Justification

Objective: To create a supply of feedstock from domestic sources

to attract IB investment.

Feedstock is one of the single largest cost component that

accounts about 40% -60% of the production cost in Industrial

Biotechnology (IB). To make IB a long-term business opportunity,

attention must be given to the critical issue of availability of the

right feedstock and at the right cost.

A mature industrial biotechnology sector requires a stable and

sustainable supply of feedstock. As an emerging global destination

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of choice for industrial biotechnology activities such as bioplastics,

biofuels and bio-based fine and specialty chemicals, it is critical for

Malaysia to establish dedicated feedstock sources. Readily

available and accessible feedstock sources would also attract

further foreign interest to invest into the country.

b) Targeted result in 2020

Starch production to be supplied to strategic IB plants, valued at

USD 37.3 million in 2020.

GNI Impact in 2020 estimated at USD 20.7 million

Employment of 590 workers.

c) Key Activities/Deliverables and Timeline

12) Industrial Biotechnology: Translating Wastes to Wealth

a) Justification

Objective: To create value from industrial/agriculture wastes.

Wastes as the result of rapid growth in agriculture, industrial and

manufacturing activities has drastically impacted the

environment.

Bioremediation is one of the key focus areas for development

under the NBP. The success of bioremediation business represents

a key ingredient in the completion of a conducive biotechnology

ecosystem in Malaysia.

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A collective of green, biotechnology-based technology providers

and businesses that offer innovative and highly effective waste

management and treatment solutions have begins to emerge –

potential to contribute significantly to the economy.

b) Targeted result in 2020

GNI Impact estimated at USD 11.4 million

Employment of 100 workers.

c) Key Activities/Deliverables and Timeline

13) Industrial Biotechnology: Venturing into pre-commercialisation

a) Justification

Objective: To attract new investment in IB and increase adoption

of new IB technologies in local market.

Bio-based chemicals/polymer producers often establish pre-

commercial pilot plants as precursors to larger, full commercial

production. These pilot plants are designed for early marketing

purposes, demonstrate the viability of the technology in scale-up

scenarios, conduct trials runs and testing to reduce

commercialisation-scale risks, and even initiate early commercial

activities.

Support on these pilot projects will also position Malaysia as a

viable destination for pre-commercialisation industrial

biotechnology activities. These pre-commercialisation projects

often lead to sizeable amount of investment.

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20 projects are targeted with average investment of RM10 million

per project.

To further accelerate the establishment of these projects,

BiotechCorp will work closely with the existing economic

corridors and state development agencies (such as ECER, IRDA,

SCORE etc.).

b) Key Activities/Deliverables and Timeline

14) Industrial Biotechnology: Securing strategic investment

a) Justification

Objective: To intensify investment in IB.

Strategic investments, from both foreign and domestic sources,

would substantially accelerate the development of the local

biotechnology industry, while simultaneously establish a strong

basis for a knowledge-based economy for the country and

ensuring that the NBP targets are met.

Increase in strategic investment would substantially encourage

technology transfer, increase employment opportunities, generate

revenue for the country and contribute significantly to the

country’s total GNI.

Collectively, the successful investments into industrial

biotechnology would also position Malaysia as the preferred

destination for industrial biotechnology investment and drive the

economic growth of the country through bio-economy.

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b) Targeted result in 2020

Total investment of USD 500 million

15) Other projects (to be proposed)

SUMMARY

Bioeconomy Initiative Malaysia (BIM) is the framework to implement the action plan outlined in the National Biotechnology Policy (NBP) for the development of biotechnology industry in various fields so as the engine to improve the national economy, supporting Malaysia’s intention to achieve the status of high-income nation by 2020. The implementation of bioeconomy projects will add high economic value and provide a significant impact on GDP/GNI growth. The focus of bio-based economy includes focusing on investments in infrastructure, research and development (R&D) and expansion of highly skilled talent pool required by this sector. These focuses lead to rapid success achieved by bio-based sector under Phase 1 of NBP in the past 5 years which has contributed more than 2.2% of GDP and aims to achieve 5% at the end of Phase 3. BIM covers life-sciences and bio-based economy with current priority areas in bioextraction, biofeeds, biocontrol, biofertilisers, biosimilars, genomics and industrial biotechnology. The implementations expected to yield GNI score of USD0.9 billion and total investment of more than USD 2.1 billion in 2020.