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Bio Technology : July 2009
AusBioFEATURE Advocacy efforts at AusBiotech went into overdrive. By January 2009, the outlook was dire and access to cash had virtually dried up. A survey of member CEOs showed the need for access to cash, with up to 20% of respondents indicating they were likely to be out of capital before access to new funds were possible. Critically, almost half of those surveyed expected to make some staff lay-offs, with the average expectation upward of 25% of personnel – and these figures were thought to understate the situation. By the first anniversary (May 2009) of Commercial Ready’s demise, the industry had lost five companies, with a number on the brink of running out of cash. Others were coping by mothballing projects or divesting some of their interests. Merger and acquisition activity grew and companies were undervalued on the stock market. It appeared the Federal Government had turned its back on biotechnology; the industry was in the grips of global economic downturn, and a tough budget loomed, the industry was set to lose a significant section of the industry. And then it came; the turning point and a signal that the Government hadn’t abandoned the industry and does view biotechnology as a key driver to economic growth and prosperity. The announcements in the 2009 budget provided a beacon of hope and much cause for 8 Australasian BioTechnology Volume 19 • Number 2 • July 2009 celebration. While the budget measures were not a quick fix or indeed a fix all, they include landmark changes to tax provisions that will be of great benefit to the industry, and a strong sign that government is keen to work with industry to advance innovation. With this needed tax change and injection of more than $150m per annum into the sector, Australia is now poised to take advantage of the discoveries that will lead us into a future where biotechnology is at the forefront of prosperity. Juan Enriquez6, writing for McKinsey’s What Matters, says biotechnology and its discoveries have provided us with the global dawn of the ‘organic age’, where “Biology is likely to become the greatest single driver of the global economy.” “In the future, wealth creation could be closely tied to life sciences, much as it is currently tied to digits…The Internet changed virtually every industry. Yet as far-reaching as the digital revolution was, the ability to code life will likely reach even further.” Enriquez says: “Biotechnology first allowed us to slightly modify a few life forms to produce medicines, new seeds, and a few chemicals. Then, in just over a decade, the development of rapid sequencing of a virus, bacteria, plant, fly, and eventually human has unlocked the entire gene code, or genome, of living things.”