Biotechnology is widely seen as the most promising new industrial field of the 21st century. It is also an area toward which Taiwan, following up on prior initiatives in information and optoelectronic technologies, has been systematically working. This seems to be a golden-egg laying goose owing particularly to the fact that it generates little pollution, but high returns over an extended period of time. However, because the R&D and clinical trial stages are time-consuming, costly, and carry a high risk of failure, Taiwan's pharmaceuticals industry--dominated as it is by medium-sized or even small firms--has made little headway in this field.

The cooperation between TaiMed Biologics and Genentech has great strategic significance. Through clinical research into and sales of the new AIDS drug, not only will Taiwan have the chance to build a production line for new medications and create a biotech industrial chain, but the project could also drive overall development of biotech in Taiwan.

In fact, there have been many twists and turns on the road bringing TNX-355 to Taiwan. The drug originally belonged to a company called Tanox, set up in the US by researcher Chang Tse-wen of the Academia Sinica's Genomics Research Center and his then wife Nancy Chang, also a leading biotech researcher. The company had spent seven or eight years from the lab to the second phase of clinical trials, and success was in sight. In 2005 Nancy Chang was invited back to Taiwan in the hope that TNX-355 would be the basis for Taiwan to build a large pharmaceuticals plant to manufacture proteins and antibodies. But while the Executive Yuan's National Development Fund (NDF) dawdled in making any clear declaration of support, last November Tanox announced that it had been acquired by Genentech. Because Genentech had already decided to build a protein-drugs plant in Singapore, Taiwan had lost its chance to build its own manufacturing center, and it had to negotiate with Genentech for a license to make the new AIDS drug.

Next, several heavyweight intermediaries tried their hands in several rounds of negotiations with Genentech, finally getting licensing for TNX-355. At the same time, to improve the legal environment for the development of biotech medicine in Taiwan, Legislative Yuan speaker Wang Jin-ping, Academia Sinica president Wong Chi-huey, and then-vice-premier Tsai Ing-wen put their heads together three months ago to midwife the Biotechnology and New Pharmaceuticals Industry Development Act, setting a new record of completing passage of the bill in only two weeks. One can see from this the importance the government places on the biotech industry.

The government's strategic encouragement of biotech pharmaceuticals has given new life to Taiwan's long moribund biotech industry. Total investment over the first six months of 2007 was NT$11.9 billion, an increase of 21% over the same period last year, and the value of biotech stocks is also on the rise.

The engine of this growth, TaiMed Biologics, is a subsidiary of TaiMed Inc.; coinvestors are the NDF, Taiwan BioVenture, and Uni-President Development Corporation. Tsai Ing-wen serves as chairwoman, and board members and supervisors include world-renowned AIDS researcher David Ho, former and current Academia Sinica presidents Lee Yuan-tseh and Wong Chi-huey, and CEPD minister Ho Mei-yueh.

By mobilizing a first-rate scientific team and the highest levels of government, and with a commitment from the NDF to invest 40%, TaiMed Biologics was able to complete patent licensing negotiations with Genentech within one month, thereby lighting a fire under the whole biotech industry in Taiwan. But the involvement of high-profile government and academic figures has caused doubts to be raised about conflicting roles among those promoting biotech and the difficulty of avoiding conflicts of interest.

In response to such concerns, Academia Sinica president Wong Chi-huey issued a statement clarifying that he was chosen by the government as a board director to represent state-owned shares in the company, but received no remuneration and had not received shares in exchange for technology. He declared that his sole aim was to secure a license and cooperation agreement from Genentech in order to develop Taiwan's own new drugs industry as rapidly as possible. and that he would immediately resign his directorship as soon as the company was up and running.

As Wong says: "No matter what, new biotech pharmaceuticals and high-end medical equipment are two critical areas our country can get into in the future. Looking ten years ahead, the global biotech market will be worth US$1.8 trillion, and Taiwan definitely cannot be left on the sidelines!"