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Hong Kong becomes world’s second largest funding hub for biotech

Hong Kong is now the world’s second-largest funding hub for biotech. This was noted by Hong Kong’s Chief Executive; it is hoped that the region will become the world’s number one.

Its strengths in the rule of law, judicial independence, rights and freedoms as well as the favourable business environment and international connectivity make it conducive to the development of the biotech industry in Hong Kong. However, the CE acknowledged that more specific measures need to be enacted.

Biotechnology is one area of I&T in which Hong Kong enjoys notable strengths. The region is home to world-class universities that offer strong research capabilities in biotech. In addition, they have vast experience and networks for creating partnerships with prominent universities, research institutions and technology-based companies from all over the world.

The recent establishment of two research clusters, one on healthcare, the other on artificial intelligence and robotics, is one of several major initiatives announced last year to further enhance Hong Kong’s research capabilities.

The idea is to converge top-notch universities and researchers from all over the world here in Hong Kong to conduct world-class and impactful collaborative researches with local institutions.

The response has been encouraging.  Around 50 proposals have been received, with more than half of them on healthcare technologies. They involve really top-notch institutions from around the world. The first research institutions are expected to set up their laboratories before the end of this year.

The current Government also funds biotech R&D through its Innovation & Technology Fund. At the end of January, more than 500 projects related to biotech had been approved by the fund, receiving funding totalling about US$130 million. Project areas range from stem cell therapy and molecular diagnostics to the modernisation of traditional Chinese medicine and biopharmaceutical manufacturing.

Healthcare data platform

The HKSAR Government is also opening up government data to encourage R&D; an important data source is the Hospital Authority. With its strong database of over 280 terabytes of patient data accumulated over 25 years, the Hospital Authority is establishing a big data analytics platform to stimulate biotechnology research. It has recently set up a data collaboration laboratory on a pilot basis, offering more flexible and interactive data sharing through the Hospital Authority.

Genomic medicine

Apart from the clinical trial, the area of genomic medicine is also being explored. Genomic medicine is an important sphere in contemporary medicine and scientific research, with huge potential in screening, diagnosis and precision medicine. To seize the potential, the Steering Committee on Genomic Medicine was established to study strategies for developing genomic medicine in Hong Kong.

 

In addition, HK$1.2 billion has been allocated to take forward a large-scale genome sequencing project, which would be named the Hong Kong Genome Project. The project will cater for future medical development in Hong Kong by establishing the genome data of the local population, testing infrastructure and talent pool. Over the next six years, the target is to sequence 40,000 to 50,000 whole genomes. The pilot phase would cover undiagnosed disorders and cancers, with clinical clues linked to possible hereditary genetic components. We have set up a working group comprising experts from the clinical, academic and research sectors to finalise the relevant framework.

Nurturing talents

The Government has been providing and promoting science and technology education in schools at every level, from primary and secondary through to our post-secondary institutions and technical colleges. This is to ensure that Hong Kong has the needed talent to sustain its I&T development. In addition, admission schemes have been launched to help our enterprises recruit talent from the Mainland and overseas.

Hong Kong’s universities, research capability and talent will make Hong Kong an excellent R&D centre. However, in order for the region to become an international I&T hub, it will need to provide an enabling environment for the transformation of R&D results and for entrepreneurship. Which is exactly what the current Government is trying to do.

Fortunately, Hong Kong’s financial market is among the world’s most competitive. Its free-enterprise economy and business-friendly environment also play a critical role in creating an attractive and enabling environment. The depth and liquidity of its capital market ensure that the I&T sector’s financing needs can easily be met.

The biotech industry has distinct approval mechanisms for turning research into commercial products. That can make it challenging for biotech companies to meet the traditional revenue and cash flow requirements for listing on the securities market.

Hence, after a thorough review, the listing rules were revisited. This resulted in pre-revenue and pre-profit biotech companies being enabled to list on the HKEx, subject to appropriate safeguards. HKEx also established a biotech advisory panel to provide advice on listing applications from biotech companies.

The new listing regime is the most significant revamp of our listing rules in two decades. The ultimate goal, of course, is to encourage research breakthroughs that lead to successful products and flourishing businesses, rewarding investors as well as the biotech companies, while boosting Hong Kong’s status as a biotechnology centre.

It is expected that more biotech companies will join Hong Kong in the future. With the Government’s strong commitment, and with the staunch support of HKEx and governmental agencies, leaders are confident that the best is yet to come for biotech and overall I&T development in Hong Kong.

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