Singapore’s biotech sector is more successful than people think

Biotech is a high-stakes sector. The fruits of success can be massive and benefit human lives. But the costs of winning are also steep, and the failure of one clinical trial or fundraising round can threaten to bring the curtain down.

In June 2023, Tessa Therapeutics, the Singapore-based biotech startup that was working to commercialize a cell therapy for cancer treatment, shut down after failing to secure the funding needed to develop its solution.

The firm had raised close to US$400 million in equity funding from backers including Temasek and EDBI.

The high-profile failure reverberated through the industry, which has been under tight scrutiny, having secured billions of funding from the public sector over the last 20 years.

Yet, the man on the street would be hard-pressed to name a prominent local biotech firm. Indeed, critics have noted that the segment has yet to see a standout success – at least by the standards of typical tech companies.

Singapore biotech startups and their investors, however, argue that applying the same barometers used to evaluate typical tech startups is unfair. They also think that the sector has seen its fair share of triumphs.

For one, pharmaceutical firms and biotech companies globally are shelling out millions to obtain exclusive rights to products developed by local firms – even pre-commercialized ones. One homegrown startup also became the first Asian company to enter the US national healthcare program.

A growing number of Big Pharma firms are choosing to base manufacturing in Singapore as well. These companies, which can identify potential innovations from local research circles and co-develop them, could kickstart a new wave of emerging drugs and therapies.

It’s all relative

Singapore has done a good job of developing a range of “best-in-class intellectual property (IP)” that’s globally competitive, according to Mirxes CEO and co-founder Lihan Zhou. However, this is just one piece of the puzzle.

While such IPs form the basis of any new drug or therapy, not many end up being adopted by a biotech firm and developed into products.

In the first eight to 10 years, a biotech startup is typically knee-deep in drug development, which involves numerous clinical trials and studies that can cost a few hundreds of millions of dollars to execute. Without a product on the market, preclinical and clinical-stage biotech firms don’t have user traction or revenue – much less profitability – to speak of.

“In Singapore, we have only embarked on this journey about two…realistically about one decade ago,” when biotech startups began emerging, Zhou says.

Singapore’s first National Technology Plan (later renamed the Research, Innovation, and Enterprise plan) in 1991 identified specific science and technology fields that had high growth potential and were of national importance.

However, biotech only kicked off in the 2000s, when the government-owned Agency for Science, Technology, and Research (ASTAR) and Biopolis, a research and development cluster of biotech firms, were established.

Mirxes, which is developing various cancer detection kits, was itself spun out from ASTAR in 2014.

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