October 1, 2008: The biomedical sciences industry in Singapore has grown tremendously fast with the biomedical manufacturing output expanding fourfold from $4.64 billion (S$6.3 billion) to $17.67 billion (S$24 billion) in 2007 at a Compounded Annual Growth Rate (CAGR) of 21 percent. The country’s Economic Development Board (EDB) has brought in $686 million (S$932 million) of investments in fixed assets and $180 million (S$245 million) in total business spending for the biomedical sciences industry in 2007. This strong wave of investments points to an expanding base of manufacturing and research activities for the biotechnology, pharmaceutical, medical technology and healthcare sectors in island nation.

Bio*One Capital, a subsidiary of Singapore EDB Investments, manages four dedicated biomedical sciences funds worth over $841.75b million (S$1.2 billion)—Biomedical Sciences Investment Fund (BMSIF), PharmBio Growth Fund, Life Sciences Investment Funds and Singapore Bio-Innovations Fund has invested in over 60 life science firms in Singapore and elsewhere.

Simultaneously, the venture capital (VC) industry in Singapore too has witnessed a high growth. The funds under their management have grown from $31.69 million (S$45 million) in 1983 to $5.53 billion (S$7.86 billion) in 1996. In the middle of 2003, some 150 fund-management companies in Singapore were managing about $11.26 billion (S$16 billion) worth of venture capital funds. These funds are invested globally across all industry sectors at all rounds of financing.

This is an indication of the growing interest among organizations and investors to be a part of the biomedical growth story in Singapore as well as other countries. Over a period of time the fund managers from Singapore have developed the skill sets of managing the funds and investing in biomedical sciences industry.

The situation wasn’t as attractive barely a few years ago as it is now. Companies such as Rockeby biomed Limited and Cord Life, both based out of Singapore, preferred Australian Stock Exchange over the Singapore Stock Exchange to go public because of good support system and management services. Rockeby biomed, engaged in the research, development and marketing of testing technologies for infectious disease in humans and animals and lifestyle health products listed on ASX on December, 23, 2003. After six months of Rockeby listing, Cord Life, a cord blood-banking group restructured itself as CyGenics Limited and listed on the Australian Stock Exchange.

Looking at the growth of the Biomedical Sciences industry and interest among the investors community, in July, this year, Singapore Exchange permitted life sciences companies with no financial track record to list on SGX and invited public comment on its latest changes to securities listing rules. The changes arise from one of the more extensive annual rule reviews.

Currently, the life science companies are at the stage of bringing products to the market. SGX noted that the companies would now be able to list on the Exchange if they demonstrate their ability to attract funds from professional investors and to generate revenue. After listing, the companies are required to provide quarterly disclosure on the use of funds to ensure transparency and timely disclosure of material information.

According to SGX, the proposed new rules allow for more alternatives that will widen the range of companies and product types listed on SGX. In addition to the diversity of listings, changes to existing rules will enable better disclosure and increased transparency for the benefit of
investors.

However, Singaporean biomedical companies are not very keen on listing on SGX. They wish to prefer “wait and watch” and they don’t want to be the first one to list on SGX under the new rule.

Although SGX hopes its new proposals should bring in cheer among the biomedical sciences companies in near future.