There's no tyranny in distance for some globetrotting Australian biotechnology companies, writes Michael Vitale

Australia must ramp up its investment in health and medical research to ensure its future prosperity, said Research Australia CEO Dr Christine Bennett and Australian Graduate School of Management professor Michael Vitale in a joint paper published this week in the Medical Journal of Australia.

Biotechnology industry observers have given the sector a mixed report card for 2004, pointing to highlights like a lively capital market and low points like failed mergers.

Australian venture capitalists invested more than $1 million per week in Australian biotechnology in the past financial year, an increase on the previous year and a recovery to the historic level of two years ago. As in the past, a large portion of the investment was made by a small number of investors, and was received by a small number of investees.

A new survey of commercialisation activity in Australia's universities, medical research institutes and national research agencies shows they are lagging well behind their Canadian and US counterparts.

Investors in the initial public offerings (IPOs) of Australian biotechnology companies have done well over the past six years -- despite the fact that the shares of most of the newly listed companies are currently trading below the price at which they were first sold.

The fifth round of Biotechnology Innovation Fund (BIF) grants, announced late last month by Federal Industry Minister Ian Macfarlane, is the final funding round for the $40 million program. Over its lifetime, the BIF scheme has supported 164 projects in 153 companies, ranging from tiny start-ups to listed giants such as Orica.

Doomsayers repent. The assertion that the Australian biotech industry is Tech Wreck II is incorrect, according to a new study by the Australian Graduate School of Management.