One Nation – One Biotech Cluster

D. P. Alexakis – Swiss Biotech Association

SwissBiotech – Heading towards success !

«The Swiss industry is emerging as a sleeping giant and one to watchin coming years » Ernst & Young, 2002

« Switzerland … has a combined science citation intensity being higher than USA, UK and the other OECD countries »

David A. King, Nature, 15 July 2004, Science Magazine, 20004

« … Switzerland is probably one of the best places for biotech companies to establish themselves… »

Ernesto Bertarelli, SERONO International SA

Switzerland at a Glance

• 2004 was globally the 2nd best year in financing

• Record number of FDA approvals for biotech products

• Basilea was the 1st IPO since 2002 in Switzerland; more companies to come in the near future

• Switzerland ranks as number 6 in Europe

• and number 9 worldwide (since 1998)

• CHF 194 million of venture capital found its way into Swiss biotechs, which makes Switzerland rank as number 3 in Europe

• Total of 223 companies (4 less than 2003) which reflects some consolidation trends going on in the industry

• Still tough times for early stage, not product focused companies regarding financing

Swiss Biotech Association SBA (130 member companies)

The SBA intends to secure the position to which biotechnology SMEs willl be entitled now and in future. Focus is on:• Support to create the conditions in biotechnology appropriate

for SMEs. • Continue the awareness programme to reduce the fear

connected with modern biotechnology • Intensify research-related communication between universities

and the biotech industry • Promotion of the opportunities attached to professional careers

in science and biotechnology sector • Integration of the Swiss Biotech Industry on the national level,

on European level and on the global level.

Switzerland at a Glance – Tables / 1

Revenues, R&D expenses, Profits/losses

5473

1388

6791172

523

4296

986531

5032

0

1000

2000

3000

4000

5000

6000

Revenues R&D expenses Profits/losses

in C

HF

mio

200420032002

Source: Annual Reports and Website information / Ernst & Young

Switzerland at a Glance – Tables / 2

Number of Employees, Liquidity

13525

15902323

11648

2483

12846

0

2000

4000

6000

8000

10000

12000

14000

16000

Employees Liquidity

200420032002

Source: Annual Reports and Website information

in C

HF

mi o

Swiss Private Companies in 2005 / 1

Revenues, R&D expenses, Profits/losses

1549

350

22

345

22

1670

323

87

1596

0

200

400

600

800

1000

1200

1400

1600

1800

Revenues R&D expenses Profits/losses

in C

HF

mio

200420032002

Source: Ernst & Young

Swiss Public Companies in 2005 / 1

Revenues, R&D expenses, Profits/losses

3924

1038657

827501

2626

663444

3436

0

500

1000

1500

2000

2500

3000

3500

4000

4500

Revenues R&D expenses Profits/losses

in C

HF

mio

200420032002

Source: Annual Reports and Website information

Swiss Private Companies in 2005 / 2

Number of Employees, Liquidity (in CHF mio)

6063

462 426

4883

499

5926

0

1000

2000

3000

4000

5000

6000

7000

Employees Liquidity

200420032002

Source: Ernst & Young

Swiss Public Companies in 2005 / 2

Number of Employees, Liquidity (in CHF mio)

7462

11341897

6765

1984

6920

0

1000

2000

3000

4000

5000

6000

7000

8000

Employees Liquidity

200420032002

Source: Annual Reports and Website information

Number of Biotechs in Switzerland

133 139129

119 115

96 9388 87 86 88 8470

90

0

20

40

60

80

100

120

140

160

2004 2003 2002 2001 2000 1999 1998

Core Biotech Companies

Biotech suppliers

Source: Ernst & Young

Year of Company Foundation

9 11 8 715

821 16 12

5

111

0

20

40

60

80

100

120

2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 Before1995

Source: Ernst & Young

Activity Fields of Core Biotechs

18.8%

12.8%6.8%

7.5%

6.8%

5.3%

3.8%

3.0%1.5%

15.0%18.8% Receptor biology/signaling

Immunology

Screening

Chemistry

Drug Delivery

Cell or tissue culture

Proteomics/Metabolomics

Bioinformatics

Genomics/genetics

Bioprocess

OtherSource: Ernst & Young

European Public Companies Products Pipeline

2845514Denmark

3116816France

32010814Sweden

7911111245Switzerland

19423565065UK

TotalPhase IIIPhase IIPhase IPre-clinicalCountry

Source: Ernst & Young and BioCentury, 2003

Swiss Biotech – Summary Companies – size distribution :

• 6 public companies (globally active), such as Serono, Berna Biotech and Actelion ;

• 18 medium-sized companies with 50-100 employees(many of these more or less ready for IPO)

• 199 smaller companies with less than 50 employees

Influx of venture capital : 2001: CHF 106 million2002: CHF 148 million2003: CHF 130 million2004: CHF 194 million

• In 2002, 2003 and 2004 Switzerland ranked third in Europe regardingventure capital influx into the country.

One Nation – One Biotech Cluster

Compared to other European countriesSwitzerland is very attractive as

global headquarters locationAs % of all global headquarters that moved to these countries

Destination of global headquarters that moved

outside their country of origin

Source : National Authorities, trade organizations and Arthur D. Little desk research - 2002

Companies use very specific criteria to determine the appropriate

headquarters location88%

Corporate tax advantagesQualified managers

Quality of lifeCentral location

Support of authoritiesPersonal preference of CEO

International managersInternational schools

Language skillsLabor flexibility (no unions, Hire and Fire)

Ease of attracting top managersHigh purchasing power

High educationAttractive personal taxes

Image of the countryLabor availability

Proximity to existing production site

72%69%

62%55%

50%48%

37%35%35%

31%25%

22%19%

17%17%

10%

Most important criteriaused by companies for

the selection of headquarters location

Arthur D. Little - 2002

Ticino - Southern part of CH Biopolo Ticino (1/2)

· Main Industry- Chemical and pharmaceutical- Banking - Textile - Tourism

· Key Academic Institiutions- Università della Svizzera Italiana, Accademia di architettura, - University of Applied sciences- Institute for Research in Biomedicine- Istituto Oncologico della Svizzera Italiana- Istituto delle Molle per la ricerca sull’intelligenza artificiale- Centro Svizzero di Calcolo Scientifico

· Initiative: www.biopolo.ch

TicinoSouthern part of CH Biopolo Ticino (2/2)

· Specialities- Strong manufacturing cluster- Strong clinical settings (public and private)

· „Flagships“ (selection)- Helsinn SA, IBSA SA - KerrHawe SA, Medacta SA- Jetpharma SA, Micromacinazione SA- Start-ups:

• Mondobiotech SA• Oncore therapeutics SA

· Competitive Advantages- Competitive position for research in human immunology- Proximity to Italy- Quality of life

BioValley Basel (2/2)

Specialities- International conferences – BioSquare 2004, MipTec, ECB11th, etc.- lectures / BioTech roundtables- access to trinational Life Sciences Network in France, Germany and

Switzerland- BioValley Journal (www.biovalley.com)

„Flagships“(selection)- Actelion Pharmaceutical Ltd.- Basilea Pharmaceutica AG (IPO in March 2004)- Hesperion- RCC, Solvias, Speedel, etc.

Competitive Advantages- BioValley (cross-border) initiative- “big pharma” connections- High concentration of science and engineering community

BioValley Basel (1/2)

Main Industry - Life Sciences: Novartis, Roche, Aventis, Syngenta, Lonza- Chemistry: Ciba Specialty Chemicals, Clariant- Logistics: Danzas, Panalpina, Rhenus

Key Academic Institutions- Universities of Basel, Biocenter/Pharmacenter- Department of clinical-biological sciences (DKBW)- National Nanotechnology Center of Competences in Research (NCCR)- European Center of Pharmaceutical Medicine (ECPM)- As from 2006: ETH Institute for systemsbiology- Friedrich Miescher Institute (FMI)- Swiss Tropical Institute- Universities of Mulhouse, Freiburg, Strasbourg

Initiative: www.biovalley.com

Greater Zurich AreaZurich MedNet (1/2)

Main Industry- (Mechanical) Engineering- Services- Banking

Key Academic Institutions- University of Zurich- Federal Institute of Technology (ETHZ)- Universities of Applied Sciences (Wädenswil, Winterthur)- University Hospital- Neuroscience Center- Functional Genomics Center

Initiative: www.zurichmednet.org

Greater Zurich Area / Zurich MedNet (2/2)

Specialities- LifeSciene Incubator - Biotop- LifeScience Park Zurich-Schlieren- Conferences and Life Sciene seminars- Focused Investement conferences

„Flagships“(selection)- Cytos Biotechnology- ESBATech- Prionics- SWX – Swiss Exchange- Nobel BioCare- Novo Nordisk

Competitive Advantages- global initiative- virtual network- financial community

Lake Geneva Area / BioAlps (1/2)

Main Industry- Microelectronics - Watches- Private Banking

Key Academic Institiutions- University of Geneva / Lausanne (HUG/CHUV)- Swiss Federal Institute of Technology (EPFL)- Swiss Institute for Cancer Research Ludwig Institute- Swiss Institute for Bioinformatics- ISREC, Lausanne

Initiative: www.bioalps.com

Lake Geneva Area / BioAlps (2/2)

Specialities- Geneva Proteomics (GeneProt)- joint efforts of academic institutions in Life Sciences- scientific parks / incubators

„Flagships“ (selection)- Serono International Ltd.- Modex Therapeutics- NovImmune- Medtronic- GeneBio, Covance

Competitive Advantages- multi-disciplinary research activities- international environment- quality of life

National Strengths through competent information

• Database with over 1000 Swiss contacts

• Organizations active in the Life Sciences area

• Main focus on Biotechnology

Biotechnology related

Biotechnology Instrumentation& Services

Biotechnology

MedicalTechnology

Non-profitOrganization

Supplier

Consulting Investor

www.swisslifesciences.ch