Faced with aging populations coupled with longer life expectancies, major countries around the world have set health care as their foremost priority in policies as related costs and spending are expected to surge dramatically in the years to come.
Driven by such needs, the world’s biotechnology market is geared for significant growth in the coming years. Meanwhile, South Korea must work swiftly to better nurture its own biotech sector, which holds immense potential to become an early leader in the field, the chief of the country’s leading biotech association advised.
“Equipped with an advanced medical infrastructure paralleling that of the U.S. as well as cutting-edge Internet and computing technology, Korea is in an excellent position to take the lead in the field of biotechnology, geared for immense growth in the future,” said Seo Jeong-sun, president of the Korea Biotechnology Industry Organization.
Biotechnology refers to technology that harnesses the science of genetics, which promises huge advances in medical treatments and services.
The global biotech market is expected to reach $604.4 billion by 2020 amid increasing demand for biotech-based diagnostics and therapeutic solutions, including recombinant DNA technology, biopharmaceuticals and DNA sequencing, according to a 2015 report by market analyst Grand View Research.
Considering the scale of the industry’s forthcoming growth, the KBIO chief — also the founder and chairman of leading Seoul-based genome sequencing firm Macrogen — said, “Korea needs at least 10 to 20 biotech companies whose sales exceed more than 100 billion won ($86.7 million) able to reap stable and visible profits in the eyes of investors.” For now, Korea has only a small number of market players with such business scale.
In its efforts to nurture the industry, KBIO has developed a plan to incubate 1,000 biotech venture firms over the next few years, by partnering them with successful local biotechnology firms like Macrogen and Celltrion and channeling support and funding from the government.
“Right now, we are in the process of building up new venture capital with sizeable funding from the science, industry and health ministries and with investment from larger, listed biotech firms like Macrogen,” Seo said.
Among other plans, the organization is seeking to revitalize the Bio-Economy Research Center, an overarching institution to plan out, manage and research Korea’s biotech development and to provide up-to-date information on local and global biotech trends, developments and news.
Such ambitious targets and agendas reflect the Korean government’s continued push to nurture the country’s biotech health care sector as one of the country’s key future growth engines by injecting large investments and altering policies to spur the industry’s growth.
The government expects the global biotechnology sector to rapidly grow over the next decade, eventually surpassing the combined scale of the semiconductor, chemical and automotive industries by 2024 — the three sectors that have been leading the Korean economy forward.
In March, the science, industry, health and drug safety ministries together pledged to inject a total of 340 billion won into such efforts, with aims to launch five original biopharmaceutical treatments utilizing the country’s cutting-edge stem cell and DNA technologies by 2017.
“The biggest issue at this point is that the ministries have been unable to establish a control tower to efficiently manage such efforts,” said the KBIO chief. “As speed is the key to taking the lead in biotechnology, a clear leader needs to step up, take responsibility and push through with concrete plans,” he said.
Marking another notable trend in the Korean bio industry, conglomerates, most visibly Samsung Group, have selected the field as a core business segment to propel new growth and channel in fresh profits in the years to come.
As Samsung has been garnering much industry attention and scrutiny for its new direction, the KBIO chief expressed caution about the conglomerate’s potential to dwarf venture firms or small-sized enterprises in the biotechnology segment.
“Samsung needs to take it slow in entering the industry after looking at the larger picture. The optimal outcome would come if Samsung can pursue shared growth, partnering up with the venture firms and help doctors open new businesses,” he said.
“At the end of the day, biotechnology, unlike other fields, is a ‘life science’ that can save and improve the quality of life for millions of people around the world. If Korea can do this successfully, the country will become a true global force for good.”