Biotechnology to Taiwan
(Last updated: 17 Sep 2013)
Trends and opportunities
The market
While the biotechnology sector is expanding in Taiwan, supported by strong government funding and private sector interest, there are some inherent weaknesses that provide opportunities for Australia.
Major weaknesses in Taiwan’s biotechnology sector include:
- Regulatory approval
- Pre-clinical trials and verification
- Protocol design
- New drug/device research
Bridging this gap with Taiwan’s renowned manufacturing and capital investment capacity will result in the rapid development of this sector. Anti-cancer, anti-ageing, tissue culture, herbal medicine, medical devices, bio chip and informatics are hot topics in biotechnology development and Taiwan is looking for products and technology to develop new drugs/devices in these areas. Leading pharmaceutical firms are aggressively seeking new product development, providing opportunities for Australian biotechnology investors and research companies.
The Taiwanese Government has recognised the importance of supporting the biotechnology industry and has backed this support with new initiatives such as the National Development Fund under the Executive Yuan. The Industrial Development Bureau in the Ministry of Economic Affairs reported that Taiwan’s biotechnology industry (including new biotech, pharmaceuticals and medical devices) value reached NT$263 billion (or A$9.7 billion assuming A$1=NT$27 in August 2013) in 2012. The long-term objective is for Taiwan to hold three per cent of the world’s biotechnology market.
In large part because of the government’s strong commitment to biotechnology and the global investment supporting development in this area, Taiwan’s private sector has quickly developed interest in biotechnology. In 2012, Taiwan’s Biotech Industry had 1,505 biotech firms and 69,470 employees.
At the end of 2012, there were 71 biotech companies registered in Taiwan – 23 listed on the Taiwan Stock Exchange and48 listed on Taiwan’s OTC (Over the Counter) market. Companies active in this industry include:
- Pharmaceuticals
- Yung Shin
- China Chemical and Pharmaceutical Standard
- Sin-tong
- Everight
- Sinphar
- Food
- The President Group
- Wei Chuan
- Kingcar
- AGV
- Chemical
- Formosa Plastics Group
- China Synthetic Rubber
- Government-owned enterprises
- Taiwan Sugar
- Taiwan Salt
- Taiwan Tobacco and Wine Board
- China Petroleum Corporation
Emerging biotech companies include Taiwan Liposome (drug delivery system), Medigen (the partner of PI-88 anti-cancer drug from Australian Progen Pharmaceuticals), and Optimer Biotech (anti-cancer).
Other major players include China Steel, Lucky Cement, Yao Hua Glass and YFY Paper.
(Source: Industrial Development Bureau, Executive Yuan, R.O.C., 2012)
Opportunities
The best opportunities for Australian biotechnology companies are in developing:
- New dosage forms
- Protein drugs
- Animal and or plant derived products
- Modernised Chinese herbal medicines
- Intermediates of bulk pharmaceutical
- Clinical trials
Three other areas of opportunity include new drug development, clinical trial cooperation, and bio–informatics.
There are a number of Australian companies already active in the market that are involved in a range of enterprises such as the development of anti-cancer compounds, toll manufacture of biomedical products and cochlear implant technology.
Competitive environment
Major global pharmaceutical companies (such as GSK and Novartis) are quite active in Taiwan. They have subsidiaries in Taiwan conducting sales and marketing, and Research and Development (R&D) cooperation. Due to cost concerns, large pharmaceutical companies have moved their manufacturing bases out of Taiwan in the past few years.
Local pharmaceutical firms are mainly small with medium enterprises manufacturing generic and over-the-counter products. In order to capitalise on the recent growth in biotechnology, local pharmaceuticals firms are engaging in new areas of research: drug dosage, delivery development and Chinese herbal medicine.
Taiwan’s medical industry has garnered a strong reputation in recent years for manufacturing electronic medical equipment/devices. Some of the local medical manufacturers provide Original Equipment Manufacturer (OEM) services for international brands. The Taiwan Biotechnology Industry Association is actively promoting Taiwan’s medical equipment at international exhibitions.
Tariffs, regulations and customs
The general tariff for generic drugs is zero per cent.
Industry standards
There are standards and qualification processes for projects to qualify for investment under the National Development Fund. These include:
- Taiwan-based Asian operations, research and development (R&D) or manufacturing centre
- Products manufactured must have US or PCT patent protection
- Products manufactured must aim to comply with USA Food and Drug Administration (FDA) requirements
- Priority will be given to products that already have patents in Taiwan, to optimise allocation of investment resources
Generally, Taiwan follows USA Food and Drug Administration practices and industry standards. FDA approval for new drugs will ensure quicker approval in Taiwan, although clinical trials will be necessary. For generic products, the manufacturers must be a Current Good Manufacturing Practice (cGMP) plant with a Free Sales Certificate issued by the highest health authority in the country (ie. Therapeutic Goods Administration (TGA) in Australia).
Marketing your products and services
Market entry
There are a number of important market entry considerations as biotechnology is still a high-risk venture. Primarily, investors or prospective local partners in Taiwan need well–prepared proposals and sound business plans to conduct evaluations. It is also important to monitor government policies closely, and to form contacts.
For Australian companies seeking biotechnology joint-venture partners, you need to:
- Understand government polices (particularly if you're interested in the National Development Fund)
- Get to know the profiles of the partners – venture capital firms or current players in the bio–pharmaceutical sector
- Present to the key people from the right companies
- Follow up diligently on return to Australia
For seeking trade partners you need to:
- Understand the market potential
- Know the import regulations and requirements
- Identify and work with an agent for product registration and marketing
Australian companies should target and market directly to key contacts in Taiwan. Be well prepared with detailed documentation and business plans. Australian exporters and companies seeking joint venture companies or alliances in Taiwan should take advantage of the following:
- Taiwan’s desire to be an international (or regional) oriented biotechnology world player, not a domestic one
- Australia ’s reputation for world-leading research, and connections in world leading biotechnology fields
- Current needs and sector interest, eg. anti-cancer, anti-ageing, tissue culture, herbal medicine and bio-informatics
- Meeting Taiwanese business executives and investors by visiting key biotechnology events around the world
If you are interested in exporting biotechnology to Taiwan, it is important to prepare a quality company website. Many of the major biotechnology start-up companies are located in the major science parks and all companies in the science parks have high speed internet access. If you attempt to sell products over the internet without a license issued by the Department of Health in Taiwan, these drugs will be regarded as illegal imports and may not be distributed.
Distribution channels
Most prescription type drugs are obtained from the hospital pharmacy or alternatively from the dispensary at the doctor’s surgery. Retail pharmacies in Taiwan carry prescription-type drugs and also offer an extensive range of over-the-counter pharmaceuticals such as analgesics and stomach medicines.
Most major foreign global pharmaceutical companies have Taiwanese agents who will arrange import documentation, hold stock and distribute to hospitals and individual doctor’s surgeries. Mergers and acquisitions within global pharmaceutical and veterinary companies have meant a rationalisation of agents in the market and there are a now a number of well-established agents who are eagerly looking for new products to distribute.
It is critical that any Australian company clearly establishes the end user for their products and then examines potential in the distribution chain. This will allow the Australian company the opportunity to maximise market potential. The possibility of multi-distributors here handling different product lines should not be overlooked.
Links and industry contacts
Biotechnology–related resources
The Biotechnology and Pharmaceutical Industries Program Office – www.bpipo.org.tw/en/
Development Centre for Biotechnology – www.dcb.org.tw
Industrial Development Bureau, MOEA – www.moeaidb.gov.tw
Industrial Technology Research Institute – www.itri.org.tw
Taiwan Biotechnology Takeoff Diamond Action Plan – www.ey.gov.tw/ct.asp?xItem=64404&ctNode=2907
Government, business and trade resources for Taiwan
Ministry of Economic Affairs – www.moea.gov.tw
Taiwan Government Information Office – www.gio.gov.tw
Media
China Post – www.chinapost.com.tw
Taipei Times – www.taipeitimes.com
Taiwan Headlines – www.taiwanheadlines.com
Contact details
The Australian Trade Commission – Austrade – is the Australian Government’s trade, investment and education promotion agency.
Through a global network of offices, Austrade assists Australian companies to grow their international business, attracts productive foreign direct investment into Australia and promotes Australia’s education sector internationally.
For more information on how Austrade can assist you, contact us on:
Australia ph: 13 28 78 | Email: info@austrade.gov.au
A list of Austrade offices (in alphabetical order of country) is also available.