Biotechnology may become success sector
International interest in the Hungarian biotechnology market is steadily increasing. This trend is evidenced by the large number of American strategic investors who have come to the country to explore possibilities in recent weeks and months.
The American medical biotechnology firm Amgen, the largest company in the global biotech industry, established a Hungarian subsidiary in May 2004 at the time of Hungary's accession to the EU.
The subsidiary became increasingly active in the autumn of last year, when the company obtained a license for wholesale trading in pharmaceuticals. Armed with the license, the company introduced new products on the Hungarian market at the beginning of 2005, making Amgen the first US biotech giant to enter the Hungarian market.
William A Haseltine, the founder and CEO of Human Genome Sciences (HGS), another American company with a similar profile, recently paid a visit to Hungary. Earlier, Haseltine worked together with three Nobel prize-winning researchers, including James Watson, the scientist who discovered DNA. A researcher turned businessman, Haseltine came to Hungary for two reasons: To advise the government on ways it can aid the development of high- tech industries in Hungary, and to hold negotiations with Hungarian companies on investment possibilities.
Hungary has already missed some opportunities, according to Haseltine, who said that two or three trains have already pulled out of the station. However, Hungary still stands a chance of boarding the fourth or the fifth, said Haseltine whose belief in the potential for the development of biotechnology in Hungary has led him to consider local investment opportunities.
One category within the Hungarian biotechnology field comprises Hungarian companies seeking a competitive edge through the involvement of venture capital, preparation for listing on the stock exchange, or with help from international partners. These companies are typically subcontractors or suppliers to large foreign firms, depending on whether they conduct experimental research, participate in joint development work, or transfer their own developments to multinational companies with superior marketing capabilities.
One of the largest such domestic enterprises not only in Hungary but also in the overall Central Europe region is ComGenex Rt, with some 200 partner firms, including global pharmaceutical giants such as Bayer and Pfizer. At the beginning of 2005, ComGenex announced the transfer of rights related to the development, production and sale of a new anti-cancer agent to its partner, Echelon Biosciences Inc, a subsidiary of Aterna Zentaris. Solvo Rt is another dynamically developing firm, having quadrupled its sales turnover last year. The chief executive of the company is the chairman of the Association of Hungarian Biotechnology Companies (MBSZ). Another company, Alltech, achieved sales turnover in excess of 1 billion forints last year.
Meanwhile, the activity of N-Gene, based in the USA and operating a research headquarters in Hungary, is also significant. N-Gene is primarily involved in research and treatment of diabetes based on genetic technology.
Primary research location for biotechnology sector
All conditions must be met in order for Hungary to become a primary research location for the biotechnology sector including schemes for enterprise development, support and finance, and the training of experts.
A conference organized in the central building of the Hungarian Investment and Trade Development Agency (ITDH) in Budapest served as a large-scale forum for the Hungarian biotechnology sector.
The conference provided a meeting place for companies operating in the sector, government representatives and research organizations, and was organized by the Hungarian Biotechnology Association (Magyar Biotechnolsgiai Szvvetsig MBSZ). In his opening speech, Janos Kska, Minister of Economy and Transport, emphasized that all conditions must be met in order for Hungary to become a primary research location for the biotechnology sector including schemes for enterprise development, support and finance, and the training of experts.
The conference addressed issues such as the current situation of the biotechnology industry in Hungary, state subsidies, grant opportunities, the effect of the Innovation Act on the biotech sector, and venture capital investment in biotechnology.
Marianna Pongorni Csakvari, Deputy State Secretary at the Ministry of Economy and Transport, detailed the ministry's program targeting support for knowledge-intensive businesses. Miklss Boda, chairman of the National Office for Research and Technology, spoke on the subject of specific grant opportunities that provide assistance to new, innovative Hungarian enterprises.
Adam Tertak, the CEO of ITDH, assured participants that the investment development organization intends to devote maximum efforts within its own means to facilitate developments in the sector.