TOKYO – A lack of a commercial mindset is holding back Japan's biotech industry as academics find it difficult to move ideas from paper to market.

A lack of cooperation among government, business and academia is one of the primary reasons behind a reluctance among researchers to take their discoveries to market, said speakers during the 12th Annual BIO Asia International Conference 2015.

One factor holding back commercialization in Japan is a distinctive lack of support for entrepreneurs, particularly when compared to markets such as the U.S.

Another factor is fear of failure. The failure of a venture is often experienced as a personal failure of all those involved. In the U.S., by comparison, a business failure by an entrepreneur is often seen as a stepping stone and a sign of experience, leading to future success.

A third factor is lack of funding. Japanese financial institutions are often unwilling to provide unsecured loans. A business plan is rarely enough to bring in cash, while big pharmaceutical companies find it relatively easy to borrow hundreds of millions for M&A activities.

The need to change that mindset is providing the impetus for several new initiatives.

One of them is a project that starts next month by the Japan Agency for Medical Research and Development to consolidate the efforts of several existing agencies to bring discoveries from university laboratories to the marketplace.

Part of the impetus for that effort comes from the few high-profile exceptions boasting commercial success in Japan, including the work of Shinya Yamanaka, the 2014 Nobel laureate from Kyoto University who has parlayed his work into commercial licenses both in Japan and overseas.

The licenses are linked to completed work that has received a "seal of approval" at the highest level.

Another project is the Medical Industry Innovation Institute that will open on April 1 and bring together corporations, government, researchers and universities in one place in Kawasaki, in a building called the Tokyo Science Center.

Some of the changes stem from contact with researchers abroad.

Japanese graduate students often work as interns overseas and they are more willing to take their research into the commercial sector upon their return, said Hiromachi Kimura, chairman of the Medical Industry Innovation Institute.

But building the infrastructure may not be enough.

Marc Sedam, the associate vice provost for innovation and new ventures at the University of New Hampshire in the U.S., said a building is not enough but, rather "it's what's in the building that matters."

Mentors, contacts and networking, including the provision of entrepreneurial and business expertise, and being able to create a sense of community, are factors that an incubator can provide.

Japan should not waste the talents of its researchers. More needs to be done by the government in providing incubator facilities. Such facilities can be tied to one university or to a number of geographically close institutions. In that way, academics can be assisted to bring their research to the public, and thus benefit society.

About a quarter of the 252 new drugs approved by the FDA between 1998 and 2007 were licensed by universities: 16 percent to biotech companies and 8 percent to big pharma.

However, when "novel" drugs meriting priority review by the FDA were considered, the share of university-licensed drugs went up to nearly one-third – 31 percent.

"What's important about incubators is that they solve the problems where they are located," Sedam said. "To help ideas reach the market without problems, there are four things needed: ideas, talent, money and infrastructure."

A case in point is the Port Business Incubator in Philadelphia, which is linked to more than 100 universities and is near a regional cluster of biotech and pharma companies.

Port provides standard incubation facilities of networking, workshops and shared equipment; it also acts as a scientific advisory board and can arrange for state-supported tax credits of up to $100,000, as well as co-location with companies. The business model is designed to appeal to a large pre-existing business community.

Another incubator is the U.S.'s top-ranked Sid Martin Biotech incubator services in Gainesville, Fla., founded by the University of Florida. Companies supported by that incubator have raised more than $1.2 billion in funding, with more than 2,000 jobs created in the region.

One of the services offered is the recruitment of entrepreneurs to lead the start-ups, which are not led by the originating academics. Pressure to succeed is lessened by the provision of unlimited residence time for the start-ups.