After working for years to make inroads in China, San Diego’s Biocom industry group has refocused its global partnering efforts on a new initiative intended to connect emerging life sciences companies in San Diego with big pharmas in Japan.
Biocom and the Japan Bioindustry Association signed a formal partnership agreement last summer, according to Biocom CEO Joe Panetta. At least 10 Japanese companies also have joined Biocom, which now counts about 800 life sciences companies as members, primarily in San Diego and Orange counties.
“We are not a large organization, and we have to choose our opportunities carefully,” Panetta recently told me. Biocom focused on developing life sciences partnerships in China from 2009 to 2013, and Panetta said he came to the conclusion that it wasn’t a good fit for the small and mid-size companies that make up most of San Diego’s life sciences sector.
Some Japanese pharmas already have established outposts in San Diego. In September, Daiichi Sankyo acquired San Diego’s Ambit Biosciences and its drug for acute myeloid leukemia for as much as $410 million. In 2013, Japanese specialty chemical and pharmaceutical maker Ajinomoto acquired San Diego contract drug manufacturer Althea Technologies for $175 million. In 2012, Takeda closed its operation in South San Francisco and expanded its San Diego center of excellence.
Generally speaking, however, “In Japan, they still think of Boston and San Francisco as the center for life sciences in the United States,” said Jiro “Tony” Fujita, who was hired last year to lead Biocom’s Japanese initiative. But Fujita sees interesting partnership opportunities for the San Diego companies focused on drug development, regenerative medicine, and digital health.
“In the 1980s and 1990s, there was a boon to create more [life sciences] startups in Japan,” Fujita said. “But they didn’t get the funding, because Japanese VC is almost like banks. The [startups] could only get funding if it was a deal that could not fail.”
With many drug patents expiring, “We recognize that the pharma industry in Japan has a need for products,” Panetta said. In his view, the biopharma companies on the East Coast are more inclined to create partnerships with Europe, which means San Diego companies have a better chance for striking deals in Japan, Singapore, South Korea, and other Asian countries.
As an industry group, Biocom has been identifying U.S. companies with knowledge of Japan’s Ministry of Health & Welfare and its regulatory requirements for drug development. “We also signed an agreement with the technology transfer office at University of Nagoya, which allows them to introduce some of their early-stage technologies to San Diego for regulatory advancement,” Panetta said. “This takes advantage of what we know to move their products.”
Japanese companies are also interested in home health care, which represents a good opportunity for San Diego’s emerging cluster of wireless health startups, Panetta said.
“In Japan, everybody is thinking [about] how to break through in new markets,” Hironori Tanaka of Japan’s Bioindustry Association told me last week at Biocom’s global life science partnering conference in San Diego. Japan’s prime minister, Shinzō Abe, “clearly pointed out future Japanese strengths, and biotech is a main sector.”
“My job as coordinator is to bring new technology to industry,” Tanaka added, “and San Diego is unique. Our cooperation with Biocom makes sense in Japan.”