AusBiotech Ltd. Release: Biotechnology Front And Centre Of Australia’s Economic Transition
AusBiotech’s 2016 Biotechnology Industry Position Survey of industry CEOs confirms biotechnology
continues to be front and centre of Australia’s post-mining boom economic transition. The sector
has been a pivotal contributor to Australia’s economy since it emerged over three decades ago. Yet
the past year has seen increasing recognition of this growing contribution by government, media,
local and global investors.
The 2016 Survey, conducted by AusBiotech with support from Grant Thornton and a contribution from Novotech, revealed key themes including economic value; business sentiment; finance, investment, listing and costs; and government policy.
Dr Anna Lavelle, CEO of AusBiotech, said: “Australian life sciences companies have attracted well over $2 billion in deal flow over the last 18 months, which is bolstering confidence and showing it can be done.”
She said, we have global recognition of the sector’s quality, reflected in major deals, including Novartis’ acquisition of Spinifex Pharmaceuticals for as much as AU$1 billion and AstraZeneca’s licensing agreement with Starpharma that could deliver over half a billion (AU) dollars.
The Survey reveals the importance of these deals to boosting the confidence of our sector – it is clear the interest and investors are there. They also have the added impact of showing key decisionmakers in government and the investment community that the industry is delivering for Australia.
The timing of these deals and the emergence of companies across the sector has been pivotal given governments’ renewed focus on innovation. There has been a significant change amongst political and policy decision-makers, recognising the importance of the biotechnology sector to Australia’s future prosperity.
Policy appears to be heading in a better direction given the contrast with last year’s Survey, when industry leaders expressed significant concern over the failure of Australia’s policy-makers to adequately respond to an increasingly competitive global environment.
“The full benefit of this new direction is yet to materialise and we are looking for more action from decision-makers in the Federal Government,” said Dr Lavelle.
The sector’s response has been positive to recent developments in the commercial and policy environment, with 75 per cent of Survey respondents saying they expect 2016 to be a year of growth. This contrasts with 2015. Only 60 per cent of respondents described the year as ‘excellent’ or ‘good’.
media release
In one of the more significant turnarounds in this year’s Survey, 41 per cent of respondents said the environment in Australia (economic conditions and public policy) was now conducive to growing a biotechnology company, up from just 16 per cent last year.
Importantly, 70 per cent expect to hire more staff, up slightly from last year’s 64 per cent and broadly in line with 2014 (69 per cent). This intent to hire is yet another clear signal of the sector’s potential contribution to Australia’s transitioning economy. It also goes to the importance of education policy and the need to ensure our tertiary education institutions remain globally competitive and continue producing high-quality graduates, particularly in science.
Significant issues of concern remain, particularly in relation to the R&D Tax Incentive, inadequate responses to other policy issues and general political instability, which will be an enduring theme in the current Federal Election campaign.
The Survey shows leaders remain concerned over the constant tinkering and reviews of the R&D Tax Incentive, with 90 per cent saying program stability is ‘very important’ or ‘important’, and 81 per cent saying they are concerned about the recently completed review led by the Chair of Innovation and Science Australia, Mr Bill Ferris AC, Dr Alan Finkel AO FTSE, Chief Scientist of Australia and Mr John Fraser, Secretary to the Treasury. The outcome of the Review is yet to be revealed.
“To ensure the momentum continues the Government needs to provide an environment where Australia’s biotechnology companies have consistency and stability around R&D tax and other incentives,” says Michael Cunningham, National Head of Life Sciences, Grant Thornton. The Survey, now in its sixth year, was open to all ASX-listed and unlisted biotechnology companies. 44 companies responded and 60 companies participated in roundtable discussions held around Australia between February and March 2016.
Key findings of the survey:
? Confidence remains strong and sets some records
Companies planning to increase their staff this year are at an all-time high with 70 per cent of companies intending to hire staff this year (up from 64 per cent last year and 69 per cent in 2014), with 30 companies intending to recruit to 213 identified new roles. 41 per cent of respondents said the environment was conducive to growing a biotechnology company, up from 16 per cent last year.
? All eyes on the R&D Tax Incentive
The R&D Tax Incentive was confirmed as the most significant Government program for promoting innovation in the private sector, which plays a pivotal role in motivating and attracting research, development and clinical trials to be conducted in Australia. The preservation of the program remained clearly the most-commonly cited, unprompted concern for the industry’s future.
? Smart science needs smart money
media release
Access to capital for companies developing new technologies remains a critical issue. The number of companies planning to raise capital dropped slightly to 40 per cent, down from the same position last year (48 per cent).
? Policy stability key
The constant reviews, threats and tweaks to industry support programs are unsettling for biotechnology developers, who have long development cycles - and undermine business confidence.
The full report is available on the AusBiotech website:
http://www.ausbiotech.org/userfiles/File/_data/reports/2016%2005%2031%20GT_Industry%20Posi tion%20Survey%202016.pdf
The 2016 Survey, conducted by AusBiotech with support from Grant Thornton and a contribution from Novotech, revealed key themes including economic value; business sentiment; finance, investment, listing and costs; and government policy.
Dr Anna Lavelle, CEO of AusBiotech, said: “Australian life sciences companies have attracted well over $2 billion in deal flow over the last 18 months, which is bolstering confidence and showing it can be done.”
She said, we have global recognition of the sector’s quality, reflected in major deals, including Novartis’ acquisition of Spinifex Pharmaceuticals for as much as AU$1 billion and AstraZeneca’s licensing agreement with Starpharma that could deliver over half a billion (AU) dollars.
The Survey reveals the importance of these deals to boosting the confidence of our sector – it is clear the interest and investors are there. They also have the added impact of showing key decisionmakers in government and the investment community that the industry is delivering for Australia.
The timing of these deals and the emergence of companies across the sector has been pivotal given governments’ renewed focus on innovation. There has been a significant change amongst political and policy decision-makers, recognising the importance of the biotechnology sector to Australia’s future prosperity.
Policy appears to be heading in a better direction given the contrast with last year’s Survey, when industry leaders expressed significant concern over the failure of Australia’s policy-makers to adequately respond to an increasingly competitive global environment.
“The full benefit of this new direction is yet to materialise and we are looking for more action from decision-makers in the Federal Government,” said Dr Lavelle.
The sector’s response has been positive to recent developments in the commercial and policy environment, with 75 per cent of Survey respondents saying they expect 2016 to be a year of growth. This contrasts with 2015. Only 60 per cent of respondents described the year as ‘excellent’ or ‘good’.
media release
In one of the more significant turnarounds in this year’s Survey, 41 per cent of respondents said the environment in Australia (economic conditions and public policy) was now conducive to growing a biotechnology company, up from just 16 per cent last year.
Importantly, 70 per cent expect to hire more staff, up slightly from last year’s 64 per cent and broadly in line with 2014 (69 per cent). This intent to hire is yet another clear signal of the sector’s potential contribution to Australia’s transitioning economy. It also goes to the importance of education policy and the need to ensure our tertiary education institutions remain globally competitive and continue producing high-quality graduates, particularly in science.
Significant issues of concern remain, particularly in relation to the R&D Tax Incentive, inadequate responses to other policy issues and general political instability, which will be an enduring theme in the current Federal Election campaign.
The Survey shows leaders remain concerned over the constant tinkering and reviews of the R&D Tax Incentive, with 90 per cent saying program stability is ‘very important’ or ‘important’, and 81 per cent saying they are concerned about the recently completed review led by the Chair of Innovation and Science Australia, Mr Bill Ferris AC, Dr Alan Finkel AO FTSE, Chief Scientist of Australia and Mr John Fraser, Secretary to the Treasury. The outcome of the Review is yet to be revealed.
“To ensure the momentum continues the Government needs to provide an environment where Australia’s biotechnology companies have consistency and stability around R&D tax and other incentives,” says Michael Cunningham, National Head of Life Sciences, Grant Thornton. The Survey, now in its sixth year, was open to all ASX-listed and unlisted biotechnology companies. 44 companies responded and 60 companies participated in roundtable discussions held around Australia between February and March 2016.
Key findings of the survey:
? Confidence remains strong and sets some records
Companies planning to increase their staff this year are at an all-time high with 70 per cent of companies intending to hire staff this year (up from 64 per cent last year and 69 per cent in 2014), with 30 companies intending to recruit to 213 identified new roles. 41 per cent of respondents said the environment was conducive to growing a biotechnology company, up from 16 per cent last year.
? All eyes on the R&D Tax Incentive
The R&D Tax Incentive was confirmed as the most significant Government program for promoting innovation in the private sector, which plays a pivotal role in motivating and attracting research, development and clinical trials to be conducted in Australia. The preservation of the program remained clearly the most-commonly cited, unprompted concern for the industry’s future.
? Smart science needs smart money
media release
Access to capital for companies developing new technologies remains a critical issue. The number of companies planning to raise capital dropped slightly to 40 per cent, down from the same position last year (48 per cent).
? Policy stability key
The constant reviews, threats and tweaks to industry support programs are unsettling for biotechnology developers, who have long development cycles - and undermine business confidence.
The full report is available on the AusBiotech website:
http://www.ausbiotech.org/userfiles/File/_data/reports/2016%2005%2031%20GT_Industry%20Posi tion%20Survey%202016.pdf