The Chair of recently established Innovation and Science Australia, Bill Ferris AC, spent Monday briefing the biotechnology sector on the $500 million Biomedical Translation Fund (BTF).
Mr Ferris led briefings in Sydney and Melbourne hosted by AusBiotech. The briefings were attended by almost 500 people and also featured a panel discussion, including well-known Australian-based biotech investors, as well as a Q&A session.
Mr Ferris outlined the BTF structure and organisation to attendees. He explained how it has been designed to support biotech through the two funding ‘valleys of death’ and progress discoveries further along the development path.
It will also help address issues with the commercialisation of discoveries, he said, contrasting Australia’s poor performance with its “stellar” record on basic research.
“The BTF will help ensure Australia does not squander our opportunity to be part of the global biotechnology revolution,” he said. “It could also encourage Australian expertise currently overseas to return home, accepting the value of these global networks”
It will be established with $250 million from the Federal Government along with matching funds from private investors that will see $500 million invested in the biotech sector.
“The BTF reflects a commitment from the top down, nationally, to support biotech,” said Mr Ferris, who also expressed confidence the fund would be in place by July.
According to Mr Ferris, the lack of capital for Australian biotech has resulted in the premature offshoring of many innovations. He said the retention of intellectual property in Australia will be good for researchers and investors, and support growth of the entire biotech ecosystem.
He said the lack of capital has also had the perverse impact of frustrating the ability of companies to collect the data required to attract investors.
Recognising the unique requirements of biotech in terms of significant capital needs and long time lines, Mr Ferris said the BTF will support the high-cost late pre-clinical, Phase 1 and early Phase 2 development stages, with investments in the range of $5-$20 million.
“Investment decisions will be in the hands of the funds managers,” said Mr Ferris. “Investments could be directed to innovations across the biotechnology sector with listed companies also eligible given some may have listed prematurely due to the lack of venture capital.”
The BTF will be a for-profit enterprise. A committee, which is yet to be finalised, will appoint a small number of private funds managers who will receive investment allocations of $50-$125 million, depending on their experience and expertise. The allocations will only become firm commitments after each manager has raised matching funds.
Returns will be shared between the Government and private investors. Mr Ferris said that, while the split is yet to be finalised, it would likely be in favour of private investors as a mechanism to encourage their involvement. The drawdown investment period will be 7 years with the maximum life of each fund set at 15 years.
Further information on the BTF will become available in the coming weeks as the BTF structures are finalised and put in place.