2014年-世界发展银行全球_Life_Sciences_Capital_Fund___Malaysia_Case_Study_16页_1mb

Life Sciences Capital Fund - Malaysia Case Study Summary

Core Content

The Malaysian Life Sciences Capital Fund (MLSCF) is a venture capital fund based in Kuala Lumpur, Malaysia, established in 2006 as a public-private partnership. It aims to facilitate the transfer of world-class biotechnology to Malaysia, focusing on early-stage investments in companies that apply advanced biotechnology in agriculture, industrial chemistry, and healthcare. The fund manages $150 million in committed capital and is co-managed by the Malaysian Technology Development Corporation (MTDC), a government organization, and Burrill & Company, a San Francisco-based merchant bank.

MLSCF is guided by the concept of "science without borders", promoting open innovation to reduce transaction costs in technology transfer. This model involves collaboration between public and private entities, and encourages the sharing of knowledge and technology between Malaysian and international companies.

Main Points

1. Strategic Vision and Mission

• Vision: Accelerate the development of life sciences in Malaysia.
• Mission: Build globally competitive life science companies that generate value in Malaysia.
• Targets: Increase palm oil yields, reduce water usage and methane emissions, and promote the use of biotechnology in food and energy production.

2. Governance and Management

• MLSCF operates under a dual governance model, with MTDC and Burrill & Company sharing control.
• The fund is structured as a private investment management company in Malaysia, with Burrill & Company and MTDC owning equal shares in the general partner.
• The general partner is compensated at 2-2.5% of the portfolio value.

3. Business Model

• Inspired by the California biotech model, MLSCF focuses on patient capital and serial funding.
• It supports the entire economic life cycle of biotech ventures, from concept to market demonstration.
• The fund emphasizes strong relationships with scientists and investors and the development of a dense biotech ecosystem.

4. Deal Flow and Partnerships

• MLSCF's deal flow comes from:
  • Other venture capital firms
  • Direct contacts with star scientists
  • Word of mouth and industry networks
  • Government-sponsored institutions
• It has developed two sets of network partners: one within Malaysia (government agencies, biotech companies, universities) and one outside Malaysia (international biotech firms and experts).

5. Staffing

• MLSCF has five senior principals, none of whom are full-time.
• These principals are from either MTDC or Burrill & Company.
• The fund also employs three financial and technical analysts based in Malaysia, who receive training in San Francisco.

6. Incubation Approach

• MLSCF provides strategic direction rather than tactical guidance.
• It supports companies by:
  • Advising on management team selection
  • Choosing appropriate CFOs
  • Facilitating strategic linkages
  • Organizing advisory boards
  • Assisting with technology transfer and market preparation

Key Information

• Indirect investments: MLSCF invests indirectly in 26 companies through Burrill & Company, with no failures reported.
• Direct investments: Invested in 12 companies, with two listed on public exchanges and one being a potential acquisition target.
• Malaysian Centricity: Companies must exhibit Malaysian centricity, which includes being based in Malaysia, operating in the country, or being willing to engage in technology transfer with Malaysian entities.
• Open Innovation: MLSCF promotes open innovation to reduce transaction costs and enhance technology transfer, especially in the context of Malaysia's biotech sector.
• IP and Collaboration: The fund supports institutional arrangements that facilitate IP transfer, including the creation of well-defined and transferable IP rights, standardized MTA and licensing terms, and interdisciplinary collaboration platforms.

Outcomes and Results

• MLSCF has achieved positive outcomes in terms of capital appreciation and sector growth.
• The fund has contributed to the development of biotech capabilities in Malaysia, particularly in palm oil-related innovations.
• It has supported palm oil genome sequencing and the development of healthier food products and industrial feedstocks.

Future Goals

• MLSCF envisions a multi-tiered investment system in Malaysia's biotech sector.
• This system would include:
  • An angel investment fund for early-stage startups
  • A venture capital fund (like MLSCF) for first-stage companies
  • A private-equity fund for more mature, market-ready companies
• Each tier would focus on different risk levels and expect different returns.

Critical Success Factors

• Strong relationships with scientists and investors are crucial for identifying and supporting promising biotech ventures.
• Open innovation reduces transaction costs and enables efficient technology transfer.
• Strategic alignment between public and private sectors is necessary for the success of biotech incubation initiatives.
• Institutional support and financial backing from government entities and public funds are vital for sustaining the biotech development process.

Lessons Learned

• Cultural change is needed in the private sector to embrace open innovation.
• Public-private collaboration is essential for effective biotech incubation.
• Technology transfer requires clear IP frameworks and standardized agreements.
• Regional impact can be achieved through technology adaptation and local application.

Implications for Agribusiness Incubators

• Agribusiness incubators should focus on open innovation to reduce costs and enhance technology adoption.
• They should support IP development and standardize agreements to facilitate technology transfer.
• Building strong local and global networks is key to attracting investment and fostering collaboration.

Contacts and References

• Photo Credits: World Bank Flickr photo collection
• Funding Source: Ministry for Foreign Affairs of Finland
• Contact Information:
  • Mailing Address: MSN I9-900, 1818 H St. NW, Washington D.C., 20433 USA
  • Email: info@infodev.org
  • Website: www.infodev.org
• References: Available at the end of the document.