SYDNEY - Australia's biotechnology industry has marked differences from biotechnology sectors in other countries, including a much greater reliance on research institutions, a national report on the industry has found.

A paper published in the August/September edition of the journal Australasian Biotechnology, by Lyndal Thorburn, of Macquarie University, in Sydney, stated 40 percent of the latest wave of Australian biotechnology companies are spin-offs from research institutions.

Thorburn, who is also a director of Advance Consulting and Evaluation, in Canberra, told BioWorld International in Europe or the U.S., new biotechnology companies are much more likely to spun off from existing companies.

She said not only are significantly more Australian companies spun out of research institutions than overseas, the proportion of local biotechnology companies created that way is increasing. In addition, as part of the research done for her now-completed doctoral thesis, Thorburn found Australian biotechnology companies employ, on average, about 60 people, compared with 230 employees in an average U.S. firm and 105 per European company.

Apart from being very much smaller than their overseas counterparts, Australian companies also seem to spend much less, in proportion to their size, on research and development.

Thorburn found 31.2 percent of staff in Australian companies are involved in R&D compared with 60 percent in the U.S. and 52 percent in Europe.

“The difference could be due to the small size of most Australian companies and the general lack of finance for high-tech sectors in Australia,“ she said.

As in other countries, there has been a distinct “surge“ in the number of biotechnology companies since 1995, with 42 of the 164 companies identified in the study being created since then - or about one-quarter of the known startups. Many of the more recently formed companies are in newer fields, such as bio-engineering, cosmetics, genomics, bioinformatics and diagnostic services.

Thorburn said it was a concern that Australian companies were so small, in relation to their overseas counterparts, as it meant they were starting from a long way behind.

She also said the government ended one scheme that benefitted the biotechnology sector - syndicates which used a major tax break for R&D. None of the recent government schemes to encourage the high-tech industry appeared to be of much help to biotech companies.

In other news, government figures have revealed Australian companies generally reduced their spending on research and development in the wake of the government cutting tax concessions for such spending.

Figures compiled by the federal Department of Industry Science and Tourism and reported by the Federal Parliamentary Opposition, which at present is the Labor Party, showed eight of the top 10 companies, ranked by spending on R&D, cut research spending as a portion of turnover in 1996 and 1997. *

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