INVESTMENT POTENTIAL IN THE BIOECONOMY Zaidi Che Man Senior Vice President Technology Venture Division 1 1
MTDC - Overview Incorporated on March 10, 1992 to spearhead the development of technology-based companies in Malaysia MTDC has since then become the country s leading agent of commercialisation providing grants and soft loans as well as incubation space. These services are complimented with nurturing and other value-added services 100% owned by Khazanah Malaysia Roles:- i. To identify, finance and develop potential companies in strategic technology areas; ii. To focus on commercialisation of public sector research results; and iii. To identify and transfer emerging and strategic technologies for industries. adoption by 2 2
MTDC - SERVICES & PRODUCTS COMMERCIALISATION SUPPORT Fund Management (Grants, BGF, BSF,VC) Technology Centtre Funding Space Supporting Service Business Advisory & Nurturing 3 3
FUNDING SPECTRUM FUND MANAGEMENT (inc VC) BUSINESS ADVISORY & NURTURING GRANT TECH CENTRE SEED START-UP EXPANSION MEZZANINE EXIT/IPO 4 4
R&D&C Chain Value PRE-R&D R&D EARLY STAGE COMMERCIALISATION COMMERCIALISATION Pre-R&D Process Value Analysi s Concept/ Idea Basic R&D Applied R&D ScienceFund Commercial Ready Prototype Incubation Pilot Plant Early Growth Production Mature Production Value Realisation Tech. Foresight, Tech. Roadmap TechnoFund OLD CRDF (8MP) CRDF (9MP & 10MP) MTDC s Investment 5 5
FUND MANAGEMENT 6 6
Fund Management: Grant / Hybrid Soft Loan Appointed by the Government since 1997 to manage Government (Ministry of Science, Technology & Innovation, MOSTI) grants under the Technology Development Programme (TDP). The type of grants are:- i. Commercialisation of R&D Fund (CRDF); and ii. Technology Acquisition Fund (TAF) In 2011, additional two funds were introduced in the form of soft loan and hybrid fund (grant + equity). The two funds are:- i. Business Start-Up Fund (BSF); and ii. Business Growth Fund (BGF) 7 7
Fund Management CRDF CRDF is as an added stimulus towards the commercialisation of locally developed technologies undertaken by Malaysian-owned companies through partial grants. The technologies can be those developed by the public sector or they can also be the output of in-house research and development (R&D) activities by the companies. Under CRDF, commercialisation refers to a process by which the results of research projects are converted to marketable products and are commercially produced 8 8
Fund Management - BSF An early growth technology based company, involves in technology commercialisation activities and ready to bring their products to markets Project proposal contain elements of commercialisation of products, processes or services & significant in novelty or innovation 9 9
Fund Management - BGF BGF is a Hybrid Fund:- Accelerate the development of local high technology companies by providing business funding to qualified grant recipients companies. Provides funding for the last mile of the R&D&C value chain. Build enough commercial value in the company to make companies attractive for follow-on financing by VCs & other financing institutions. To demonstrate that grant recipients which have received strong market validation for their products/services are further supported to become full-fledged commercial enterprises. 10 10
Recognised Life Sciences Sectors for Funding Deal flows technology -related businesses covering: Medical Devices Diagnostics Pharmaceuticals Vaccines Agro-Bio Life Sciences Tools Industrial Biotech/renewable energy 11 11
CRDF and TAF: Commercialisation of Bio-based Technology as Observed from CRDF and TAF Approvals 12 12
Amount Approved (RM Million) Amount of Fund Approved Amount of Fund Approved During 9th and 10th Malaysian Plan 300 294 250 200 150 91.81 9th 10th 100 46 50 2 - CRDF TAF Data for 10 th MP is between April 2011 until recent approval on 5 October 2012 13 13
CRDF and TAF Approvals Points to Note:- The data represents only Malaysian companies embarking on commercialisation projects. Approval of projects is dependent on various factors company s eligibility, project s commercial viability, company s technica/marketing strength etc. Number of projects funded are dependent on ceiling of funds per Malaysia Plan (MP). For the purpose of bioeconomy analysis, 5 technology clusters (Agriculture Products, Biotechnology, Food, Medical Devices and Pharmaceutical) are classified under Biobased Technology. Projects approved under 10 th MP is still on-going. Therefore, analysis focus on 9 th MP projects since most of the projects has been closed and commercialisation has taken 14 place. 14
No. of Projects Approved CRDF Projects Approved (9 th MP) CRDF Projects Approved by Technology Cluster (9th MP) 40 38 35 30 29 25 20 15 10 5 14 5 5 3 3 16 8 11 2 3 1 3 2 9 2 0 15 15
No. of Projects Approved TAF Projects Approved (9 th MP) 6 TAF Projects Approved by Technology Cluster (9th MP) 6 6 6 5 4 3 2 1 3 1 2 3 1 1 1 1 1 0 16 16
Summary of CRDF and TAF Approvals (RMK 9) Details Bio-based Technology* Other Technologies No. of Projects Approved Total Amount Approved (RM) Total Sale Generated (RM)** CRDF TAF CRDF TAF 56 12 98 20 90,363,825 16,249,650 203,910,230 29,559,700 146,179,786 48,073,430 939,253,381 217,576,345 *Bio-based Technology includes Agriculture Products, Biotechnology, Food, Medical Devices and Pharmaceutical technology clusters. **Sales generated is as of January 2013. 17 17
INVESTEE COMPANIES 18 18
Investment - Malaysian Life Sciences Capital Fund (MLSCF) Life science venture fund specialising in early stage investment in agriculture, industrial and healthcare biotechnology. Co-managed by MTDC and Burril & Co. Currently has USD150 million in committed capital. 19 19
Investment - Malaysian Life Sciences Capital Fund (MLSCF) Portfolio companies 20 20
FUNDING AVAILABLE AT MTDC 21 21
Name Summary of Funding Available at MTDC Commercialisatio n of R&D Fund (CRDF) Technology Acquisition Fund (TAF) Business Start-Up Fund (BSF) Source of Fund MOSTI MOSTI MOF MOF Business Growth Fund (BGF) Fund Objectives To promote the commercialisation of local R&D undertaken by Malaysian owned company To facilitate eligible Malaysian companies in the acquisition of foreign technologies for immediate incorporation into the company s manufacturing activity To support and encourage entrepreneurship and creation of new strategic businesses that are important and potentially scalable; and the funding of supporting companies within a technology ecosystem To support successful gran recipient companies until they can generate sufficient commercial value to attract VC financing and other form of financing Focus Sectors Locally developed high technology, except ICT Technology companies, ICT except Technology companies High Technology companies Subscription Equipment Partial, matching grant Partial, matching grant Loan with convertible option to equity Hybrid a combination 22 of grant 22 and equity
Summary of Funding Available at MTDC Name Commercialisation of R&D Fund (CRDF) Technology Acquisition Fund (TAF) Business Start-Up Fund (BSF) Business Growth Fund (BGF) Maximum Funding Quantum Recognised Cost Repayment Period Repayment Start Up to RM 4 million or 70% or recognised cost, whichever is lower Equipments, Administrative & Overhead (CRDF1 & 2), Cost of Technology, Cost of Production (CRDF1 & 2), IP Protection, Marketing RM 2 million or 50% or recognised cost, whichever is lower Cost Technology of RM 5 million or 90% or recognised cost, whichever is lower Equipments, Administrative & Overhead, Cost of Technology, Cost of Production, IP Protection, Marketing NA NA Max of 8 years, including 3 years grace period NA NA First month of the 4 th year Up to RM 1 million (grant) + RM 3 million (investment equity) Equipments, Administrative & Overhead, Cost of Technology, Cost of Production, IP Protection, Marketing Based on redemption and IRR at 15 % NA Coupon Rate NA NA 3.5% NA 23 23
www.mtdc.com.my MTDC s on the Web 24 24
Contact Details LEVEL 9, MENARA YAYASAN TUN RAZAK, JALAN BUKIT BINTANG, KL Zaidi Che Man zaidi@mtdc.com.my 25 25
THANK YOU 26 26