BioWorld International Correspondent

WASHINGTON - The UK biotechnology industry is displaying fundamental strength in the way it is surviving the current prolonged downturn, said Science Minister David Sainsbury, who is leading the UK delegation at BIO 2003.

He told BioWorld International, "The UK industry is weathering this difficult period very well." He cited figures for 2002 that show the UK biotechnology sector as a whole raised more than US$528 million, accounting for approximately half the total amount raised in Europe. Of that, more than half was raised from private venture sources, making 2002 the second-best year for private equity.

"This is interesting because there has been a lot of gloom about biotech funding over the past 18 months to two years," Sainsbury said. Venture capitalists had quite considerable sums to invest but they are being cautious about where they are putting their funding. "Even when IPOs are very difficult, they have been prepared to invest, so that's very encouraging," he said.

One-third of all Europe's biotech businesses, amounting to 480 companies, are based in the UK, of which 16 are currently profitable. Sainsbury said that given the difficulty some of th0se companies are having in finding funding, it is important not to define the strength of the sector by the number of companies. But he said it was an indication of "how well we are doing against countries in Europe."

For example, although Germany has a similar number of companies, Sainsbury said there is a difference between the UK and German situation because soft money from government grants made it so easy to set up companies in Germany. "The German situation was ridiculously easy," Sainsbury said. Many German start-ups got off the ground and attracted significant funding without going through the rigors of venture capital scrutiny.

Assessing the relative strengths of the biotech sector in different European countries is "not a numbers game. But it is encouraging that we [in the UK] are still getting companies being set up."

And Sainsbury said the government "will listen very carefully" to any proposals the industry may have to make on how the government can help improve the public funding environment.

Sainsbury also discussed how the government is responding to industry concerns about the activities of animal rights extremists. It is bringing in amendments to legislation on antisocial behavior to make it apply to protesters who harass medical researchers and biotechnology and pharmaceutical industry staff who are involved in animal research.

Sainsbury said controlling the activities of animal rights extremists was of enormous concern to the government. "It is intolerable that people undertaking legitimate economic activities, required by regulatory agencies, should be subject to such high levels of harassment and abuse."

Last Friday, two amendments were tabled to the Anti-Social Behaviour Bill, which is expected to become law later this year. The first reduces the number of people who constitute a public assembly from 20 to two, while the second extends the offense of aggravated trespass, which currently applies only to the open air, to include trespass into buildings.

The UK BioIndustry Association has been lobbying for a single piece of legislation to cover the activities of extremist groups such as SHAC, or Stop Huntingdon Life Sciences, which with its action forced the animal testing company Huntingdon Life Sciences to delist from the London Stock Exchange and for the UK government to have to provide it with banking facilities.

But Sainsbury said, "There is in fact a considerable amount of existing legislation that can be used to prevent harassment," adding that he wants HLS to be freer to operate.