BBI Japanese Editor

TOKYO – The 14th Interpex Japan conference held this past summer at Tokyo Big Site, organized by Reed Exhibitions Japan Ltd. (Tokyo), drew 395 exhibitor companies who displayed products or services in 822 booths, marking an increase of 45% over the previous year. The exhibition was a part of the International Expo and Conference for Pharmaceutical, Cosmetic and Detergent R&D and Manufacturing Technology and was the largest of its kind in Japan. Characterized until last year as the International Exhibition of Manufacturing Technology, the event this year was scaled up to the International Exhibition of Research & Development/Manufacturing Technologies, focusing on drug creation centering around the human genome – an area still in an early stage of commercialization.

A special seminar was organized at a pavilion that was newly set up to aid research efforts. Fred Ericke, director of the Forensic Chemistry Center of the FDA, spoke on "Global Trends in Regulatory Compliance," which drew an audience of about 1,000 from related industries. Bill Sheldon, president of Eisai Inc., who spoke about the company's successful experiences in the U.S. market in a talk titled "A Japanese Company Manufacturing in the USA," provided useful information to Japanese companies that have manufacturing facilities in the U.S.

Few Japanese companies involved in cutting-edge technologies in the biotechnology and drug discovery sectors were seen on the exhibition floor, reflecting the disjunction between research activities in academic circles and industry in Japan.

Short-cut approaches by Japanese firms

Shin Sato, chief researcher at Fujisawa Pharmaceutical (Osaka), in a talk on "Development of Novel Technology Relating to Drug Discovery," noted that western pharmaceutical companies are capable of pursuing comprehensively analyzing genetic functions backed by enormous financial strength as a result of becoming large corporate entities through mergers and acquisitions. In contrast to such firms, Sato said Japanese pharmaceutical companies are not powerful enough to use the same approach in analysis of protein functions in tens of thousands of kinds.

A "short cut" for Japanese companies, therefore, will be to search for drug target particles through gene expression analysis, projection of efficacies and pharmacogenomics. Some of the ways to do this, Sato said, would be to comprehensively search for indications and SNPs relevant to disease. In this, he said it is imperative to predict a patient's response to genetic drugs (distinguishing responders from non-responders) for efficient clinical evaluation by revealing ectogenous factors and endogenic factors of the disease. Boiling down disease-specific expressed genes by means of DNA chips and classification of functional genes using bioinformatics and improving efficiency of research by introducing advanced technologies will be the strategy for these research and development efforts.

Japanese pharmaceutical companies are exploiting a variety of strategies that would compensate for their relative financial weakness – for example, avoiding head-on competition and concentrating on niche segments or highly specializing in selected areas, capitalizing on unique technologies developed by universities, acquiring start-up businesses from overseas, entering into collaborative research or joining research networks.

Technology transfer ventures

The Center for Advanced Science and Technology Incubation (CASTI; Tokyo) was founded in 1998 by the Advanced Science and Technology Institute at Tokyo University for transferring technologies developed by the university to industries. Takeshi Yamamoto, CEO and president of CASTI, said that the company had transferred 14 items to private enterprises as of March and that 15 more items were in negotiations for such action at that time. At the time of his talk, CASTI listed 148 technologies among its offerings, with another 74 items that are in the patent-pending stage.

Yamamoto said the institute has established another company, Advanced Science Technology Enterprise Corp. (ASTEC), to foster venture companies seeded with promising technologies developed by the university. While those efforts are in their infancy compared to activities at many U.S. universities for transferring technologies developed by institutional researchers, these efforts by Tokyo University mark the first tangible results by the institution in marketing the technologies it has developed.

For a long time results of research conducted by universities were not effectively marketed to industries and the national universities were not eligible for patenting the technologies developed because universities are not given incorporated status. Such a climate has resulted in low incentives to exploit commercialization of the research developed. Only in recent years have Tokyo University and other institutions begun setting up corporations within their academic structure to actively engage in communications with industry. The government is also backing the effort under the so-called Hiranuma Plan, which envisions 1,000 joint venture companies between the universities and private corporations being set up. The background for these programs includes the effort to halt Japan's economic recession, now lagging for nearly 12 straight years and causing a drain of talented manpower overseas. The move also is being spurred by the upcoming shift of the national universities to independent administrative agencies, as well as by the steepening decline of the college-age population and continuing low birth rates in Japan, which make the operations of those universities more depressed.

In contrast to the U.S., where some studies indicate the annual economic effect of educational-industrial agreements totals in the neighborhood of $33.5 billion and contributes to the employment of 280,000 persons, Japan has just now made a slow start in this direction. Many universities are now setting up satellite corporations for technology transfer and preparing for marketing university-developed technologies to industry. In April 2000, the government relaxed its previous ban on national university teachers concurrently holding other jobs. It has contributed to 50 or more universities setting up organizations to assist start-ups companies, with an increasing number of professors now also holding business titles. Under the leadership of Prime Minister Jun Ichiro Koizumi, who pledges to abolish unnecessary government-affiliated corporations, not only is there movement toward privatization, but also toward congregating businesses into groupings aimed at more efficient use of available funds.

One noteworthy effort is the development of a world-class advanced medical research center now under construction as a cooperative effort between industry and the academic world, targeted for completion between 2002 and 2004 in the Kansai area of western Japan, centering around Osaka. In conjunction with the construction of the research center, an advanced medical technology center for technology transfer also will be built, with the participation of municipal bodies.

Such movements also are spreading among other non-national universities. Waseda University (Tokyo) is proposing to provide offices with legal and financial support for students to be able to set up companies in two years.

The National Institute of Industrial Technology, Japan's largest public research organization, is restructuring itself into 22 research sections and organizing 23 practical research centers specialized into potentially promising research areas, including centers for life information analysis, gene discovery research and tissue engineering research. The focus is on identifying genomic areas in which Japan is lagging behind western countries.