by Dr. Hsien-Hsien Lei
Posted January 14, 2008 in Business of DNA, DNA Around the World
Early last week, Beijing Genomics Institute (BGI) announced the complete sequencing of the fourth human genome in the world. Later the same week, whole genome sequencing company, Knome, announced a partnership with BGI where BGI will provide genome sequencing, assembly, and annotation capabilities. Knome will be responsible for analytic tools, security protocols, and genetic interpretation services. According the press release, BGI has over 120 sequencing machines, 10 supercomputers, and 500 terabytes of storage.
Given all the quality control issues surrounding Chinese-made products in Summer 2007, I wouldn’t blame anyone for doubting the quality of genomics in China as well. And although I’d already placed my bets on Singapore being the biotech hub of Asia because of my own positive experience with science in Singapore and scientists from the city state, it appears that I may be mistaken.
Nature Biotechnology reports that China is making great strides in health biotech and with a billion-patient market, who can resist? Shenzhen SiBiono GeneTech Co. developed Gendicine, the world’s first commercialized gene therapy for head and neck cancers. Shanghai United Cell Biotech is making the only tablet cholera vaccing available worldwide. Other Chinese biotech companies are working on vaccines for HIV, Japanese Encephalitis, SARS, and pandemic avian influenza (H5N1). And, of course, BGI has been sequencing genomes.
Development of health-related biotechnology in China is not without its obstacles. Some of the issues raised include:
- China’s uncertain financial system
- Rigid restrictions on exports
- Quality control
- Intellectual property rights
- Lack of trust between China-based and international partners
- Barriers created by language, travel, culture, and project management styles.
For biotechnology companies looking to expand their business in China, Stephen M. Sammut of Burril & Company has this advice:
…the countryâ€™s industry might be better served if Chinese residents in the West built transnational companies with a footprint in both China and the West.
While this practice is already common, regulations and taxation policies to encourage this approach would address many of the concerns of private and public capital, assure prospective alliance partners, and add depth to the pool of experienced managers. Such an approach would also promote China as a co-development partner rather than a purely low-cost venue to international companies to contract services.
So it appears that Knome is on the cutting edge of both genomics and international business. Because labor costs in China are much lower than in the US, partnering with BGI will surely improve the bottom line as well. Another smart move for a company that’s charging $350,000 and more for whole genome sequencing.
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