Memorandum by Bionow (North West Development
Agency) on behalf of the North West Biotechnology Cluster
This submission is provided to the Committee
to highlight, in particular, the benefits of appropriate cluster
development and the specific role that specialised incubators
can play in the development of the biotechnology industry.
1. THE NORTH
The North West of England has a proud tradition
in pharmaceuticals, life sciences and clinical research and biotechnology,
especially biomanufacturing. For example, the first commercial
production of a biologic, insulin, was undertaken at Eli Lilly
at Speke, Liverpool. The Region has all the components of a true
cluster for biomedical biotechnology (though not all at critical
mass) and the ability to support the entire business life cycle
of a biotech/pharma companyfrom discovery to mature manufacturing
business, from start up venture to global company, from potential
to profit. See Appendix 1Cluster Timeline.
1.2 Industry Profile
There are some 120 biotech/pharma companies
employing about 17,000 in total with 60 in the identified "core"
group (13,500 employees) ie R&D based biomedical companies
(drug development, diagnostics, devices and healthcare). Of these,
five are multi-national pharmaceutical companies (AZ, GSK, Eli
Lilly, Aventis and BMS) and account for about 70% of the "core"
employees. Assuming a GDP of £70,174 per employee (ABPI figures
for 1999) the contribution of this core cluster is £947,349
million. Biotechnology employees are considered to contribute
three times the average industry GDP so employment in this cluster
is very high value-added. While the majority of biotechnology
companies (drug discovery) are not in profit they can attract
substantial investment funding. Typically this will be in stages:
seed (£100K); first round (£2-10M); second round (£10-30M)
and IPO (£100-300M). The North West does, however, house
one of the UK's two profitable biotech companiesPowderject
(Evans Vaccines). Opportunities for supply chain development within
the region are also significant given the trend towards outsourcing
among both biotechnology and pharmaceutical companies particularly
in R&D, manufacture and clinical trials. See Appendix 2Regional
Map of Companies.
1.3 Cluster Characteristics:
The Biotechnology Cluster in the
north-west is focused on biomedicine as this is where the region
can play to its strengths in the global marketplace ie therapeutics,
clinical research, diagnostics and devices.
The cluster is geographically focused
between Manchester and Liverpool, along the M62/M56 corridor and
down into Cheshire.
The cluster is characterised by a
considerable strengths in the academic and clinical base (Manchester
and Liverpool plus Daresbury), relatively few mature (listed)
R&D based biotechnology companies and a major pharmaceutical
presence, particularly in manufacturing.
The cluster is "Marilyn Monroe"
shaped in terms of its component partsfull at the top (science
and clinical base) and bottom (major pharmaceutical presence)
but with a slim waist (fewer mature biotech companies). The aim
is to expand the waistline while maintaining the curves!
2. CLUSTER DEVELOPMENT
The North West has always had a strong pharmaceutical
and chemical company presence and, as previously mentioned, certain
of these companies (eg Eli Lilly) had developed biologics manufacturing
capability. However, the number of start-up R&D biotechnology
companies was relatively small although there was a flurry of
technology-based companies (several now listed) started in the
late 80s/90s from UMIST eg Tepnel, Osmetech (previously Aromascan)
as well as Medeval, a CRO spun out from Manchester University.
Notably, both Universities had developed technology transfer companies
at this time (UMIST Ventures Ltd and Vuman Ltd) from which these
companies were launched.
2.2 IncubatorsCatalysts for Clustering
A second wind of biotechnology company initiation
came in the late 1990s with the development of the Manchester
Biotechnology Incubator (Manchester Biotech Ltd). The project
was initiated in 1994 and founded by members of the School of
and was supported by the University of Manchester and ERDF funding.
Manchester Biotech Ltd has since merged with the aforementioned
Vuman Ltd to form Manchester Innovation Ltd (MIL CEO: Dr Maire
Smith), which is responsible for both the University exploitation
activities and the Incubator. The Incubator, formerly opened in
1999 is now full and MIL has spun out, supported or accommodated
some 13 new biotechnology companies to-date. It is a clearly recognised
"hub" for biotechnology activity and a catalyst for
clustering, being centrally located in the "Manchester Health
Corridor" and co-located with both universities and hospitals
plus The Wellcome Trust Clinical Research Facility, and the NoWGEN
facility (to be developed). A second, adjacent incubator/technology
development projectthe Core Technology Facilityis
also underway. MerseyBIO (within the University of Liverpool,
Director: Mr John McQuillian) is developing another biotechnology
incubator (due for completion late 2002) and acting as another
"hub" for biotechnology development in Merseyside. A
number of commercial technologies have been identified and potential
companies are under consideration.
It is important to note that both specialised
incubators are geographically located within centres of academic
research and clinical excellence where there is both the necessary
calibre of research and sufficient critical mass to generate new
spin out activity.
2.3 The Regional Biotechnology Cluster Programme
(Bionow)Capitalising on Opportunity and
Bionow is the NWDA's biotechnology cluster development
programme with a primary aim to promote, support and develop the
biotechnology industry in the North West as part of the Region's
economic development and regeneration strategy. The North West
Development Agency (NWDA) and, previously, Inward (the North West's
Inward Investment organisation and now subsumed within the NWDA),
have been most supportive of biotechnology development and have
clearly recognised the value of the knowledge economy within the
Agency's Business Development Directorate under Mr John Burrows
OBE. In 1999 the NWDA identified a number of potential clusters
for the region including biotechnology and sought funding for
a number of pilot programmes including biotechnology. The Sector
Director came originally on secondment (but is now directly employed)
from the Biotechnology Incubator in March 2000. Bionow was initiated
at that time and then formerly launched by Dr Tom McKillop, CEO
of AstraZeneca, in November 2000 at the first Bionow Conference.
Bionow has only limited human resource (Director, Project Manager
and Administrator/PA) and funding but is able to undertake a number
of roles to help develop and support the cluster in the wider
framework of the NWDA:
Managing NWDA's biotechnology cluster
development programme with a Biomedicine and Healthcare focus.
Information and advice.
Accessing partner agencies, science
base, technology transfer operations, professional services.
Inward Investment Support.
Network Events, Conferences and Workshops.
Direct Management and Championing
of Strategic Projects.
Industry Working Parties.
Bionow has a membership
of some 500 individuals and is supported by an Industry-led Steering
Committee/Advisory Group, chaired by Mr Peter Raymond, Chairman
of Tepnel Plc. A recent survey to the membership revealed that
the Bionow programme is providing value to a majority of the members.
WHAT DO MEMBERS RECEIVE DIRECT BENEFIT FROM?
|Newsletters (monthly email and quarterly hard copy)
|Quarterly network evenings||84%
|Signposting and general advice||30%
|Workshops and conferences||40%
WHAT DOES BIONOW REPRESENT?
|R&D based SMEs (start up)||91%
|R&D based SMEs (mature)||75%
|Universities and Research Institutes||78%
|Tech Transfer & Exploitation Orgs||81%
|Professional Support Companies||63%
The apparent success of Bionow in a relatively short period is
probably due to a number of factors:
Presence of the necessary components for a true
traded cluster though not all at critical mass.
Ownership and full support at RDA level.
Small but dedicated executive cluster team with
a strong sectoral knowledge and, in the case of the Sector Director,
a well established network of private and public sector contracts
at regional and national level and credibility in the sector.
Enthusiastic and senior individuals who have taken
on entrepreneurial, mentoring or promotional roles for the community
and/or provided expert input to major projects above and beyond
their direct responsibilities.
Co-operation rather than competition between key
organisations to develop and support truly regional projects eg
NoWGEN (the NW Genetics Knowledge Park).
Well recognised hubs such as the Manchester Bio
Incubator (Manchester Innovation Ltd) and MerseyBIO.
2.4 Strategy and Project Co-ordination
Bionow is able to champion, support and in some case directly
manage major projects to aid cluster development. This regional
role allows for co-ordination of projects to ensure maximum synergy
and added value. These projects, both operational and in development,
are set against a number of recommendations (R1-R4) to be set
before the North West Science Council by Bionow on behalf of the
Recommendation One (R1): Build on excellence and
invest in the science and technology base with major infrastructure
projects and support programmes.
Recommendation Two (R2): Bridge the academic/clinical
to commercial gap by fully developing both the Manchester and
Liverpool "Health Corridors" and other regional nodes.
Recommendation Three (R3): Promote clinical trials
capability and clinical expertise alongside basic science in order
to ensure that genomics and post genomics tools are used and accessed
effectively and within a clear framework for health benefit and
Recommendation Four (R4): Although there are notable
activities in other parts of the region, support activities should,
ideally, be located within the geographic core of the cluster
and/or aligned with the key Research Universities and Institutions
to maximise effectiveness.
|Manchester Biotechnology Incubator^||R2, R4
|Core Technology Facility (CTF)*||R2, R4
|MerseyBIO Incubator^||R2, R4
|Institute for Biomedical Informatics*||R1, R4
|Genetics Innovation Unit^||R2, R4
|National Biomanufacturing Centre (NBC)*
||R1, R2, R4 |
|Genetics Knowledge Park (NoWGEN)* ||R2, R4
|NW Genomics Consortium^||R1, R4
|Molecular Imaging Centre (MIC)^ ||R2, R3, R4
|Clinical Research Database^||R3, R4
|* Projects Championed or directly managed by Bionow.|
^ Projects supported by Bionow eg support letters, promotional
activities, advisory role etc or are being considered.
See also Appendix 3Regional Biotechnology Project
2.5 Recent Advances
In the last 12-18 months the North West Region has achieved
12 new core start-up biotechnology companies gaining
more than £25 million in investment and employing over 300
New facilities for six established companies from
outside the region (UK, US and Europe) representing investment
in excess of £50 million.
Major investment (c£150 million) by established
pharma and biotechAstraZeneca, Powderject (Evans) and Aviron
Successful bid for NoWGEN one of five UK Genetic
Bionow highlighted as case study for best practice
by DTI plus.
£18 million investment in Science Base via
Smith Committee to support programmes in Genomics, Post-Genomics
(the NW Genomics Consortium) and Molecular Imaging Research.
£19 million infrastructure funding for life
science to University of Manchester (£15 million) and UMIST
£10 million Research Council funding for
a joint Manchester-Liverpool Tissue Engineering Research programme.
Suceessful bid for one of two National Clinical
Genetics Reference Laboratory in Manchester.
See also Appendix 4Cluster Profile Update.
The North West Biotechnology Cluster has developed a noticeable
energy and sense of community over the last two to three years.
This has been stimulated by the Manchester Biotechnology Incubator
project, in particular, as well as the effort and enthusiasm of
many companies and individuals in the Region. The cluster has
been further developed and more widely recognised as a result
of the NWDA's Bionow cluster programme, several publicly funded
projects and a number of strategic studies and funding bodies
such as the Smith Committee and NW Science and Daresbury Review
Committee (both in 2000). The NW Science Council is set to provide
further direction and support with regard to the underpinning
science and clinical research required for cluster development.
Public funding and organisation has been crucial to this activity
and it is important that it is maintained at a sufficient level
to enable this work to be continued.
Dr Linda Magee
Biotechnology Sector Director & Head of Bionow,
North West Development Agency
5 April 2002
Annex 1 Cluster Timeline*
Annex 2 Regional Map of Companies*
Annex 3 Regional Biotechnology Project Linkage*
Annex 4 Cluster Profile Update
North West Cluster Mapping Update 2002: Biotechnology
The North West biotechnology cluster 
is probably the most dynamic of the UK's life science clusters.
The number of companies in the cluster has grown considerably
in the past two years, increasing by over 70%. The core biomedical
biotechnology companies 
have increased from 42 to 72 and the total number of companies
from 100 to 172.
There are 20,000 people employed in these companies 15,000
of which are employed in the region's 72 core companies. Although
many more who are key contributors to the cluster are employed
in the public sector eg Universities, Research Institutes and
Since August 2000 the average investment into the cluster
companies has increased from £0.62M to £1.83M (this
data excludes a major investment into a single company).
The key strength and growth segment of the region's biotechnology
sector is biomedical and biopharmaceutical biotechnology with
sub-clusters in bio/pharmaceutical manufacturing and a mix of
therapeutic and diagnostic technologies amongst the biotechnology
companies. 94% have human healthcare as a single or predominant
commercial or technical focus.
The North West is home to seven multinational pharmaceutical
companies: AstraZeneca, Aventis Pharma, Bristol-Myers Squibb,
Eli Lilly & Co., GlaxoSmithKline, Miza and Aviron (Medimmune).
AstraZeneca also has its largest world R&D centre in Cheshire.
The North West has 17 listed biotechnology/healthcare companies
of which 10 have a significant proportion of their operation in
the North West. These companies are: Advanced Medial Solutions,
Applied Biosystems, ML Laboratories, Drew Scientific, Maelor,
Osmetech, Protherics Molecular Design, PowderJect Pharmaceuticals,
Provalis, Tepenel Life Sciences and SSL International.
A particular industrial strength is pharmaceutical and biopharmaceutical
manufacturing. Making the NW one of the only UK regions that has
strengths in the full pipeline of technologies from drug discovery
to manufacturing for the market.
Annual turnover across the core companies in the region currently
totals approximately £2 billion and company turnover has
increased by an average of 13% since 2000.
The Manchester BioIncubator, MerseyBIO and other regional
incubation initiatives (classified as outside the "core")
have a significant contribution to make with regard to the region's
The epicentre of the North West's biotechnology cluster is
the Manchester-Liverpool corridor but the cluster has a significant
presence in Cheshire and the south of the region.
A significant R&D and clinical community, affordable
space for company growth, a significant biomanufacturing capability
and good international access, all contribute to the region's
growth and are the source of competitive advantage.
15 April 2002
Professor Mark Ferguson, CBE, Professor John Hickman and Dr Linda
Bionow is a brand within the NWDA and supported by public funding
with occasional sponsorship for network evenings and conferences
etc. Membership is free and open to company or organisations clearly
focused on biotechnology eg R&D based biotechnology companies,
pharmaceutical companies, professional advisers and investors,
incubators and technology transfer organisations, entrepreneurs
and key academics. Back
These individuals include Professor Mark Ferguson (Renovo &
University of Manchester), Mr Peter Raymond (Tepnel), Dr Crawford
Brown (Eden Biopharm), Dr Chris Preston (GSK), Professor Julian
Crampton (University of Liverpool), (all members of the Bionow
Steering Committee) & Dr John Stageman (AZ) (member of NW
Science Council) and Dr Paul Drayson (Powderject) (member of the
Merseyside Life Sciences Steering Group). Back
This summary was prepared by Dr Mike Fisher, Biotechnology Project
Manager, Bionow, NWDA, from a confidential report prepared by
ANGLE Technology, May 2002 for NWDA. This extract is distributed
with kind permission of NWDA. Back
The cluster is related specifically to biomedical biotechnology
companies and this was the focus of the study. The cluster study
also included companies close to the north west border, although
they are outside the formal NWDA regional boundary. Back
Core biotechnology companies for this study were defined as "companies
that use modern biological techniques to develop products or services
to serve the needs of human healthcare". Back