Pre-COVID-19, life sciences was already an economically significant industry; now the social and economic opportunities and benefits the sector provides to Australia and the world is respected even more. Australia’s mature and thriving industry is well-placed to participate in the global industry growth being experienced.
A record-high for life sciences capital raising was experienced in 2021, however, unquenched, the thirst for capital and skills remains as industry feeds its need for commercialisation, clinical development, and growth amid an expanding industry that is being driven by a flourishing digital health sector.
Australia’s Biotechnology Sector Snapshot 2022, conducted by Ausbiotech and supported by Grant Thornton, has revealed an impressive 43% growth rate in the sector in the past two years.
This growth can be predominantly attributed to the increased focus on developing our domestic and global vaccine production capacity, building our capabilities in medical products and technologies, and addressing the sector’s ability to commercialise and manufacture as a means to manage the effects of the pandemic.
With increased demand for medical care and solutions for telemedicine and teleconsultation in the past two years, it’s no surprise that Medical Technologies and Digital Health have been dominating the field. Supported by investments into innovation, these investments not only help service healthcare providers, but create efficiencies with consumers.
These sub-sectors were closely followed by Pharmaceuticals, and Food and Agriculture Biotechnology companies – areas that have been key to our building post-pandemic resilience as we increasingly rely on local produce.
At a domestic level, the strong reputation of the ‘Australian made’ label and our position as a significant global player have created the ideal time for these Australian companies to expand our manufacturing capabilities and establish Australia as a life sciences hub for South East Asia.
Yet with key challenges including difficulties translating research into competitive products, supply chain disruptions and difficulties around collaboration – it’s important for the Government to continue embedding the right structures to help organisations take their product from development through to commercialisation. In addition, biotech companies face a new challenge, as they increasingly struggle to raise fresh funds. Pandemic investors have begun pulling their funds from the sector and seek safer assets. Alongside inflation, high interest rates and a dip in valuations, the sector is set to continue feeling the impacts of the pandemic.
To counter-balance these challenges and ensure the sector experiences continued growth, there has been significant investment into supporting businesses in a post-COVID world. We’ve seen a real commitment from Governments at Commonwealth and State level in developing the biotechnology industry, ranging from investments in R&D and support for skills development, to the framing of regulatory and tax policies that impact the sector. This a suite of schemes made available encourage Australia’s economic recovery and capture more value locally as part of domestic and international supply chains.
Australia’s Biotechnology Sector Snapshot 2022, conducted by Ausbiotech and supported by Grant Thornton.