Country Report: Austria - Pharmaceutical Executive


Country Report: Austria

Pharmaceutical Executive


Peter Halwachs Managing Director, Life Science Austria Vienna
Historically, Austria has provided an attractive environment for innovation. "For over a hundred years, Vienna has always been a center for talented scientists and groundbreaking medical research, as well as having strong hospital infrastructure" says Ingo Raimon, general manager of Abbott spinoff AbbVie GmbH. "From the perspective of AbbVie, we are represented with the best scientific research in the country." The organization runs clinical programs for some of the most widespread and serious diseases, such as Hepatitis C and uveitis.

Ingo Raimon, General Manager of AbbVie GmbH
Life Sciences Austria (LISAvienna), a joint venture between the City of Vienna and the Austrian government, is an organization dedicated to helping upcoming life science companies get started financially through public and private funding. Johannes Sarx and Peter Halwachs, both managing directors of LISAvienna, are optimistic about the future of biotech in Austria. "The Austrian government understands that although we do need to put austerity measures in place like other countries to balance the budget, these cuts are not being made in innovation and startup support. In an economic recession you need to invest in innovation."

Thomas Lingelbach, CEO, Intercell
Additionally, the environment for biotech in Austria is very welcoming in terms of bringing a wide variety of international people to the scene. Even without being able to speak German, it is possible for individuals to move to Vienna and get started in the life sciences industry with a startup, putting Austria in a very easy and welcoming position compared to its Eastern neighbors.

Jürgen Balthasar, Country Manager Switzerland and Austria, Genzyme
That being said, the road to success for biotech companies in Austria is not a piece of Sacher torte. Only 3 to 4 percent of biotech companies actually manage to bring a product successfully to the Austrian market. Additionally, the environment in failure in a clinical trial for biotech companies in Austria is generally one of intolerance. Thomas Lingelbach, CEO of Intercell, notes that this is an attitude that is specific to the German-speaking world. "This is not only public perception, but also the perception among the investor community. Investing in biotech means investing in risk. High risk and high return is not something very much appreciated in the ­German-speaking world." Compared to the more forgiving atmosphere in the United States, the perception of failure in clinical research in Austria and its German and Swiss neighbors tends to make the Germany-Austria-Switzerland (DACH) region hazardous. Sarx points out that, particularly among serial ­entrepreneurs, "It is important not to judge people if they fail. It is not about names or brands; biotech is about people and talent."

Furthermore, with a relatively small population, Austria may not always have an adequate number of people with a certain disease to justify developing a drug to treat the disease. Jürgen Balthasar, country manager of Austria and Switzerland for Genzyme, says that "proportionally, the numbers in Austria are smaller than other European countries. Sometimes, there are diseases that affect about five to seven patients in this country and we have to decide whether we want to launch a product here, or whether to have Genzyme's German counterparts take care of such a product. If a disease is extremely rare, Genzyme may not be able to handle it in Austria alone. Then we can work with bigger teams in Germany and look for a way to bring the product to Austrian patients."

Hermann Katinger, CSO and Founder, Polymun Scientific
While certain organizations are in place to help provide private funding for biotech companies, many of these start-ups could benefit from additional funding from big pharmaceutical companies. The founder and CSO of local biotech company Polymun Scientific, Hermann Katinger, points out that it is often the case that unless a biotech company has solid Phase II data from clinical trials in place, the large pharmaceutical companies will not display interest unless the biotech company has something truly groundbreaking.

Hans Loibner, CEO, Apeiron Biologics
Perhaps one of the most interesting and popular subjects of study among biotech companies is the development of monoclonal antibodies. The antibody market is currently estimated at between USD 50 and 70 billion worldwide. Polymun Scientific, based just north of Vienna, is noted for having developed the first human monoclonal antibodies to neutralize HIV. However, Katinger noted, "during these studies, it was extremely difficult to raise money, partly because of the lack of organizations that seemed to truly care about this critical issue."

Despite big pharmaceutical companies having the capital to invest in such companies, according to Hans Loibner, CEO of Apeiron Biologics, there is great potential for symbiotic relationships between big and small in Austria that is being passed up. "I do not understand why big pharmaceuticals are not investing more in these small companies, as it is a win-win situation. By doing so, you have access to potentially new developments which would help young companies and also create a significant return on investment. It is much cheaper than using money for internal research, which is inflexible and poorly run. With the money big pharmaceuticals have, this could be done for hundreds of biotech companies, who would consequently be motivated to work even harder."


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