Biomedical to Taiwan

Trends and opportunities

The market

Taiwan is consistently ranked as the top knowledge economy in Asia (Source: Asia Development Bank-Innovative Asia: Advancing the Knowledge-Based Economy). The biomedical sector has been identified as one of the five pillar industries for Taiwan’s national development. The Government of Taiwan has set the target of launching 20 new drugs and 80 medical devices in the global markets by 2025 in its Biomedical Development Plan (Source: Taipei Times - Biomedical industry development project approved). This will present multiple opportunities for Australia’s biomedical sector.

The Industry Development Bureau (IDB) under the Ministry of Economic Affairs (MOEA) reported that Taiwan’s biomedical industry value reached US$12.2 billion (NT$298.6 billion) in 2015. Taiwan’s biomedical industry increased from 1,428 firms and 60,457 employees in 2011 to 1,871 firms and 76,159 employees in 2015 (Source: Ministry of Economic Affairs, Taiwan- Biotechnology Industry in Taiwan 2012, 2015 and 2016).

Talents, well-established research/clinical study institutes and medical centres, and well-recognised intellectual property (IP) protection are required in the biomedical development.  To cultivate the biomedical sector, the Government of Taiwan not only invests but also adopts friendly listing practice for biotech companies based on high growth potential and expert evaluation. As of 17 February, 2017, there are 157 biotech companies registered in Taiwan Stock Exchange and Taiwan’s Over the Counter (OTC) market (Source: Data generated from Market Observation Post System).

A lot of companies from ICT-related industries are being transformed to become players in the medical devices industry. The strict regulatory environment for this sector necessitates the demand for relevant expertise and experience in dealing with US Food and Drug Administration (USFDA) and European Medicines Agency (EMA).

With government targets of 20 new drugs and 80 new devices, there is a strong need for conducting clinical trials and licencing-in new IPs to grow the pipeline of Taiwan’s biomedical sector.

Opportunities

The opportunities with great potential for Australian biomedical companies are in the development of new drugs and medical devices.

New drug development and clinical trials

Taiwan’s new drug development companies aim at global or regional markets in the following areas:

• new dosage forms
• protein drugs
• animal and/or plant derived products
• modernised Chinese herbal medicines
• Asian prevalent diseases drugs
• oncology
• pain management
• cardiovascular related diseases
• orphan drugs.

These companies are developing new drugs internally and/or acquiring new IPs externally. They also look for clinical trials that can be conducted in centres recognised by USFDA and EMA to enable their global/regional market entry including licensing to multinational pharmaceutical firms.

Medical devices development

Taiwan already has a well-established medical device hardware manufacturing industry, and is a manufacturing hub for medical devices, for example: the hand held devices of Roche and Johnson & Johnson are mainly made by Taiwan.

In recent years, the government has endeavoured to move the domestic industry up the value-add chain, by offering tax credits and research and development (R&D) incentives to encourage the development of more advanced devices.

For Australia, the key areas of opportunities lie in value-adding in niche sub-sectors:

• Intelligent medical technology (Medtech), in particular applications in IVD diagnostics technologies/solutions such as point of care, remote or mobile, wearables and tele or home care
• Bio chip (with Taiwan’s strong foundation in semi-conductor) and related medical devices integrating ICT technology
• Class Three or invasive devices’ clinical trials
• Sleeping technology
• Microsurgery
• High-end dental device
• Regulatory approval consultancy service for the medical devices development.

In meeting the target of 80 new devices by 2025, the demand for technology licencing-in, clinical trials and regulatory approval consultancy for the medical devices presents considerable potential business opportunities.

Competitive environment

Some Australian companies are already active in the market such as the development of anti-cancer compounds, toll manufacture of biomedical products (e.g. CSL Behring’s plasma toll manufacture for Taiwan), clinical trials and Cochlear implant devices.

Major global pharmaceutical and medical devices companies (such as GSK, Novartis, Roche, Johnson & Johnson) are quite active and have subsidiaries in Taiwan conducting sales and marketing and R&D cooperation, including IP licencing.

To enhance the awareness of Taiwan in the world biotech stage, Taiwan has been an active participant in the annual BIO and other international events and related activities.

Taiwan’s medical industry has garnered a strong reputation for manufacturing electronic medical equipment/devices for international brands. Taiwan Medical and Biotech Industry Association is actively promoting Taiwan’s medical equipment at international exhibitions, such as Medica Trade Fair in Germany.

Tariffs, regulations and customs

The general tariff for drugs and medical devices is zero per cent.

Regulations

Drugs and medical devices is a highly regulated sector. Taiwan FDA’s approval is required for the importation of all drugs and devices. Overseas company should have their branch or subsidiary or assign a distributor (or an agent) to file TFDA for the import permit and/or drug/device licence. The Free Sales Certificate issued by the TGA and the manufacturer’s master plan with cGMP certification should be submitted for review by the TFDA.

For IP licencing negotiation and related deals, TFDA will not engage in these business affairs.  However, for clinical trials conducted in Taiwan, the TFDA assigns Centre for Drug Evaluation (CDE) to review the protocols, but the overall supervision of clinical trials in Taiwan are still under TFDA’s portfolio.

Industry standards on joint-investment in biomedical sector

Taiwan has government funding to invest in the biomedical sector. There are standards and qualification processes for projects to qualify for investment under the National Development Fund. These include:

• Taiwan-based Asian operations, R&D or manufacturing centre.
• Products manufactured must have United States (US) or Patent Cooperation Treaty (PCT) patent protection.
• Products manufactured must aim to comply with US Food and Drug Administration (FDA) requirements.
• Priority will be given to products that already have patents in Taiwan, to optimise allocation of investment resources.

IP protection in Taiwan

Taiwan is a well-regulated market with strong IP protection that is the cornerstone for its position as a world leader in ODM and OEM collaborating with global brands such as: Apple’s i-phone, HP, Dell, Roche, Johnson & Johnson, etc. Taiwanese Government understands the importance of IP protection to foster innovation and technology developments. Through the establishment of a legislative framework to enforce IP protection, Taiwan has since 2009 been removed from the watch list of Special 301 Report of the United States (Source: Office of the United States Trade Representative- 2009 Special 301 Report).

Marketing your products and services

Market entry

There are a number of important market entry considerations. Prospective local partners in Taiwan need well-prepared proposals and sound business plans to conduct evaluations.

Australian companies seeking biomedical joint-venture partners are advised to:

• understand government polices (particularly if interested in the National Development Fund)
• get to know the profiles of partners
• identify the appropriate companies and contacts
• follow-up diligently on return to Australia.

For seeking trade partners:

• Understand the market potential.
• Know the import regulations and requirements.
• Identify and work with an agent for product registration and marketing.

Australian companies seeking joint venture or alliances 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
• Meeting Taiwanese business executives and partners by visiting key biotechnology events around the world and in Taiwan (Bio Taiwan)

Distribution channels

For the new drugs and devices development, there are no traditional distribution channels. It would be useful identifying and approaching the companies or institutes with interests and/or needs in clinical trials, IP licencing, regulatory approval consultancy.

Building contacts at related international conferences, exhibitions or investment forums, or through Austrade posts’ connections, promotion or business matching activities are the effective ways in growing awareness and establishing connections with potential partners.

Links and industry

Biotechnology

The Biotechnology and Pharmaceutical Industries Program Office
Development Centre for Biotechnology
Industrial Development Bureau, MOEA
Industrial Technology Research Institute

Government, business and trade

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