Malaysia's Biovalley Gets Lift as Kim Tan Returns to His Roots

(Wall Street Journal, Europe)
03-Feb2003

Kuala Lumpur -- MALAYSIA-BORN KIM TAN, one of Britain's leading biotechnology entrepreneurs, has been one of the loudest detractors of his native country's bid to build a biotech sector from scratch.

He has long maintained that Asia is far behind the biotech curve, and Malaysia more so than most nations in the region. The country's homegrown science community is virtually nonexistent, he said, which would make it tough to compete with the U.S. and Europe for investment. Malaysia's neighbors, such as Singapore, meanwhile, have similar ambitions but more money with which to lure talent from abroad.

Then, recently, Mr. Tan changed tack, announcing that he would team up with a government investment arm and manage Malaysia's first biotech venture-capital fund.

Why the change of heart? "Nationalism," says Mr. Tan. "I could make far more money, and it's easier over there [in Britain]. The main reason: I'm a Malaysian. One has a responsibility to [his] country."

Mr. Tan's decision to play the role of founding father for Malaysia's planned life-sciences sector is a coup for the country's government, which wants to create a biotech hub, called Biovalley, near Kuala Lumpur. The government has said Biovalley will include three nationally funded research institutes and tax incentives to attract foreign companies. More details on the hub will be announced later this year.

As manager of the fund, Mr. Tan will provide key expertise and commercial know-how to the Biovalley initiative, says Mohammed Sheriff Mohammed Kassim, managing director of Khazanah Nasional, the government agency involved in the fund. Mr. Tan has three listed biotech companies: London-listed KS Biomedix, which is developing cancer-fighting antibodies; TranXenoGen, which is using genetic engineering in chickens to make them produce eggs containing therapeutic proteins that can then be extracted for use in drugs; and Genemedix, listed both in London and Singapore, which makes generic drugs.

Nationalism may be a driver, but there are potential benefits, too. Mr. Tan's listed companies passed over Malaysia in the past in favor of Canada and China as facility sites, because the incentives were better. If Malaysia becomes more competitive, he says, he would ask the boards of those companies to consider putting future plants here.

Copyright © 2003 Dow Jones & Company, Inc.

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