Italy’s biotech industry has made remarkable progress in the past five years. According to Assobiotec (Italian National Association for the Development of Biotechnology), the number of biotech companies has grown from 83 in 2003 to 228 in 2007. After a successful development phase, the sector is now in the process of integrating biotechnological and pharmaceutical companies, financial institutions and research institutes. Italy ranks among the leading countries in life sciences – in pharmaceuticals, it ranks third in Europe (after Germany and France) and fifth in the world, with the USA and Japan in the first two positions.
Healthcare companies (Red Biotech) still dominate the sector (73%), while White Biotech (including agrofood) represents only 13%. There is an increasing trend toward smaller, high tech enterprises (75% of accredited companies have fewer than 50 employees) although medium and large companies still generate 97% of the sector’s sales and account for 84% of R&D investments. 2007 R&D investments totaled $1.8 billion, a 9% increase on the previous year.
An area with particular growth potential is technology transfer. Italy is known for its strong tradition in science and innovation, with world-class research centers for biotechnology; however, optimizing research outcomes and transferring technology to the private sector has yet to reach its potential. There is strong demand for tech transfer know-how and consultants with life sciences and business development experience to help bridge the gap between research and commercial applications.
Assobiotec reports that numerous Italian biotech companies are diversifying into nanotech projects. Moreover, nearly all of Italy’s universities and national research institutes with technology programs are involved in nanotech R&D, and the National Program for Research (NPR) has made nanotechnology a top priority, with national funding of nearly $96 million in 2007.
Companies devoted to healthcare still dominate the biotech sector in Italy. Primary areas of interest are oncology, immunology, infectious diseases and cardiovascular applications. Exports of products to serve research centers and healthcare facilities are promising prospects, with particular demand for human diagnostics and instrumentation. As the country’s elderly population grows, demand for non-invasive cancer diagnostic tools and therapeutic products are expected to increase. For nanotech research, there is also growing demand for instrumentation used in working at nanoscopic scales, as well as diagnostic tools based on DNA.
In agrofood, the introduction of genetically modified (GM) crops in Italy (and in Europe) has proven to be difficult. In November of 2008, however, the Italian government lifted a ban on growing GM foods, allowing for tightly controlled scientific research in a number of regions. Still, environmental groups continue to resist these initiatives and gaining social acceptability of GM foods will remain a challenge for the foreseeable future.
The Ministry for Foreign Affairs and ICE (Italian Trade Commission) have identified biotechnology as a key sector for international collaboration. The government is therefore working to implement and improve policies to promote the sector, including intellectual property protection, tax relief for corporate R&D expenditures and tax incentives for start-up and early-stage biotech companies.
Technology transfer represents one of the most promising areas of opportunity, as the Italian industry looks to international partners for licensing agreements and joint ventures. Italy is a center of excellence for biotechnology research; however, optimizing research outcomes and transferring technology to the private sector has yet to reach its potential.
Demand for financing and investment partnerships is also strong. The Italian venture capital industry is in a formative stage and still needs considerable strengthening. Companies lack access to seed and early stage capital as well as risk capital (angel investors). Italian biotech companies have an excellent pipeline, but often lack expertise in business development. They are eager to work with partners who can provide the necessary know-how, networks and capital to accelerate the pipeline development phase. U.S. companies adept at commercializing research outcomes will find numerous opportunities to work with innovative Italian companies with potential to create value for their partners.
Another area of growth and opportunity is Nanobiotechnology. According to Assobiotec, numerous Italian biotech companies have reported diversifying into Nanobiotechnology projects, and nearly all of Italy’s universities and national research institutes with technology programs are involved in nanotech R&D. The National Program for Research (NPR) has made nanotechnology a top priority, with funding of nearly $96 million in 2007. Economists predict a $600 billion global market for nanotech products in the next 10 years, with biotech applications that promise to improve our quality of life. Italian companies are aligning their R&D efforts to compete in this high-potential field.