Biotechnologies in Brazil - Technology Vision Group LLC

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Dec 1, 2012 (4 years and 11 months ago)

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BIOTECHNOLOGIES IN BRAZIL


1. Brazil: current status and perspectives………………….……… …… ……..2

2. Biotechnology Sector in Brazil: an overview…………… ……..…………..8

3. Brazil: a new hotbed for investments in biotech… ………..........................12

3.1. Agribusiness and Green Biotechnology…………………… ……....................12

3.2. Biofuels…………………………… ……………………… ……….………….14

3.3. Pharmaceuticals and health biotechnology……………… … …… …….……..18

4. Growth in Brazilian Biotech spurred by a favorable environment…….….30

5. Who is who in the Brazilian Biotech Market…...…… …… …..…………..35

5.1. Top-tier players…………… ………………………..……… ……...................35

5.2. Major Universities and Research Institutes in Biotech Research.............…….40

5.3. Support Institutions………………… …… …………………………….……..43


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1. Brazil: current status and perspectives

Unique natural wealth

Brazil has an area of 8,500,000 square kilometers, a 7,500 kilometer-long coast, the largest
supply of fresh water, including the largest river in the world in terms of extent and volume,
access to the largest amount of solar energy and the largest potential for biomass production as
a source of renewable energy, the world’s richest biodiversity (55,000 species of trees, almost
1,700 birds, approximately 500 mammals, 3,000 species of freshwater fish) and the world’s
largest tropical forest.
It is hard, if not impossible, to find such extraordinary natural wealth and such wide variety of
resources and beauty anywhere else on our planet. It represents the tremendous, perhaps even
unique “Brazil Asset” in terms of sustained and env ironment-friendly food, energy and
biodiversity-derived drugs and products
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.
For the moment, this is a promising albeit unexplored asset with great opportunities for the
development of the biotech and agro-industries.
Advancement of Knowledge with Development of the Economy

Over the last 50 years, Brazil has developed a competitive academic capability in the activities
of the advancement of knowledge and the training of human resources. There has been a six-
fold increase in scientific production since 1980 – a rate of growth well above the world
average –, whilst the highly successful state drive to support post-graduates over this period
nowadays enables the qualification of 9 thousand new PhDs each year.



1
“The economic challenge of biotechnology in Brazil” Avila, A., Cunha, E., Yeganiantz, L. Paper presented for
the 4th International Conference of the International Consortium on Agricultural Biotechnology Research
(ICABR) on ”The Economics of Agricultural Biotechnology” Ravello (Italy), August 24-28,2000.

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In the specific field of biotechnology, Brazil has accrued a respectable know-how in the course
of the 20
th
century. The country has developed world-class expertise and a strong technical
position in a number of crucial enabling technologies such as stem cell research, genomic
studies, plant biotechnology and vaccines.
Brazil bounding forward as a genomic powerhouse
In 1997, the State of São Paulo Research Foundation, FAPESP, and the Ludwig Institute for
Cancer Research initiated the first major genomic project in Brazil. Since then, Brazil has gone
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on to become one of the leading producers of gene sequencing data in the world. Furthermore,
it has done so not by relying on one massive sequencing facility, but by bringing together a
large number of individual labs and local researchers who are using their collective talent to
pursue cutting-edge research in Brazil.
On July 2000, Brazilian scientists published the first-ever sequence of the genome of a plant
pathogen, Xylella fastidiosa, the causal agent of many economically important plant diseases,
which poses a major threat to orange cultivation. On that same month, they announced the
successful composition of 279,000 human expressed-sequence tags (ESTs), small pieces of
DNA that allow genes to be located along chromosomes. Only in America and Britain have
more than that number of human ESTs been identified.

Subsequently, the Ministry of Science and Technology (MCT) and the National Council for
Scientific and Technological Development (CNPq) set up the Brazilian National Genome
Research Consortium, a network established to foster the development of qualified manpower
in the field of Genomics. It comprises 25 sequencing laboratories distributed across the country,
a DNA processing laboratory, a Bioinformatics Center and includes around 100 research
workers.
All these experiences demonstrate the country’s ability to put together first-rate genomic
capabilities in a remarkably short period of time, allowing it to emerge as a major partner in
several world-wide endeavors, such as the Cancer Genome Anatomy Project and the annotation
of the human genome.
Publication of the genome sequence of the citrus pathogen,
Xylella fastidiosa, by Brazilian Geneticists.
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Brazil has built on its very strong academic base and has clearly established a world presence.
It is, thereby, prepared to establish collaborative networks with leading global companies and
universities.

Country’s General Data

Territory: 8.514.215 km²

Population: 189.334.953 inhabitants (07/2007)

Gross Domestic Product (GDP): US$ 1,313,590 millions (2007)

International Reserves: US$ 117,84 billions (2007 – BACEN)

Human Development Index (HDI): 0,792 (2005)
Currency: Real (R$)
Language: Portuguese


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BOX 1. Brazil: a leading emerging market
Do you think you know Brazil? You might know the country’s beautiful beaches, its famous night life and captivating
music, but there’s another Brazil you need to know about. It’s a Brazil with a growing economy — a Sou th American
economic giant into which investors are pouring money.
Brazil, with an estimated 5.5% growth in GDP for 2008, has low inflation rates and a pressing global demand for its
exports. Real interest rates are at their lowest level since 2001. Exports and the trade surplus have soared, pushing foreign-
exchange reserves to a whopping $190 billion and making Brazil an international creditor. In February 2008, Citigroup
put out a research note highlighting the rise of the Bovespa, Brazil's stockmarket, to the number one spot on MSCI's
emerging-markets index, which has a wide following
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.

The country's growth potential and favorable economic conditions have stimulated foreign direct investment (FDI), to the
extent that it is one of the largest single markets for attracting FDI in the world, with 2% of the total global allocation.
Brazil's IPO market in 2007 represented 11% of the world's IPO market. Spending power has increased, and attractive
interest rates (11.25% in 2007) create sizeable returns on invested capital.
In 2003, Goldman Sachs, an investment bank, selected Brazil, along with Russia, India and China, as one of the four
“BRICs”— emerging economic powerhouses that would share dominance of the world economy by 2050
2,3
.
In some ways Brazil is the steadiest of the BRICs. Unlike China and Russia it is a full-blooded democracy; unlike India it
has no serious disputes with its neighbors. It is the only BRIC without a nuclear bomb. The Heritage Foundation's
“Economic Freedom Index”, which measures such facto rs as protection of property rights and free trade, ranks Brazil
(“moderately free”) above the other BRICs (“mostly unfree”)
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.

1. “The biggest emerging market, sort of.” The Economist print edition. (Mar 6th 2008).
2. “Dreaming with BRICs: the path to 2050.”,Goldman Sachs Global Economics Paper N. 99 (October 1, 2003).
3. “How solid are the BRICs?” Goldman Sachs Global Economics Paper N. 134 (December 1, 2005).
4. “Brazil: Land of promise.” The economist print edition. (Apr 12th 2007).



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BOX 2. Why invest in Brazil?

￿ In 2050, Brazil will be the world’s 5
th
largest economy (Goldman Sachs)
￿ Currently, it is one of the four largest economies of the developing world;
￿ It ranks as the 12
th
largest economy in the world, a GDP of approximately US$ 2 billion and US$ 190
billion in exports in 2007;
￿ Brazil has an area that represents a quarter of all Latin America and the 5
th
largest country in the
world;
￿ It has 190 million inhabitants and an economically active population of 100 million people;
￿ Main entrance door for Mercosur;
￿ Stable economy with consistent annual growth
￿ Inflation is currently at an all time low
￿ Huge increase in Foreign Direct Investment
￿ South America's leading economic power considered low risk in terms of war, terrorism and natural
disasters.
￿ The largest and most diverse industrial base of Latin America and Caribbean;
￿ One of the most modern and cutting-edge bank systems in the world;
￿ 22% of the world’s arable land;
￿ It has one of the most modern telecommunication systems;

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2. Biotechnology Sector in Brazil: an overview

A study carried out by the BIOMINAS Foundation in 2007 identified nearly 200 life science
companies in the country, 40% of which were classified as biotechnology companies
2
. This
study was not a census, but examined a representative cross section of the companies, capturing
an accurate portrait of the industry.
The Brazilian Biotech Firms are fundamentally involved with the provision of products and can
be divided according to their activity as follows: the most popular sectors are Agriculture
(22,5%) and Reagents (21,1%). The second tier is comprised of Animal (18,0%) and Human
Health (16,9%); followed by the Environmental category, which contains 14,1% of the
companies. Bioenergy (4,2%) and Mixed Activities (2,8%) constitute the last tier.

More than one fourth of them are up to 2 years old (26,7%); while 2 ,9% have 2 to 5 years of
activity and 21% have been active for 5 to 10 years. The data clearly demonstrates the youth of
the sector and its accelerating growth rate, as 51% of the companies were created after 2002.
Only 28% of the Brazilian biotechnology companies surveyed were founded before 1997.
As expected, the Bioenergy sector is the youngest, most likely a result of the recent demand for
alternative, renewable sources of energy. On the other hand, the most mature sectors are


2
Biotechnology companies were defined as companies whose main commercial activity depends on the
application of biological organisms, biological systems or biological processes, either as in internal research
and development, in manufacturing or in the provision of specialist services (adopted from Nature
Biotechnology). Companies that did not fit into the biotechnology category but develop activities in human
and animal health, agriculture or environment were defined as life science companies.

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Animal Health, Environment and Agriculture, most likely due to the historical role played by
agribusiness in the country.
Within the biotechnology companies, roughly one fifth (21,5%) generated more than R$ 1
million in revenues; 16,1% had revenues of up to R$ 10 million, whereas only 5,4% were at the
top group with revenues higher than R$ 10 million.
Once revenue levels are directly correlated with age, young firms will have lower revenues and
more mature firms will have higher ones. Accordingly, all the companies that reported having
no revenues are up to two years old, whereas all companies in the top tier have been in the
market for at least 15 years. The high number of young biotechnology companies results in the
prevalence of micro and small-sized firms.
Major markets in Brazil: Minas Gerais and São Paulo
The Southeastern Region of Brazil is home to the vast majority of biotechnology companies
and is also where the main clusters are located.
The clustering of the biotechnology sector is even more prominent when considering that only
a few municipalities and their respective zones of influence account for the greatest number of
companies.
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The city of Belo Horizonte, home to 15,5% of the nation’s biotechnology companies stands out,
as does Campinas, home to 14,1%. São Paulo (9,9%), Ribeirão Preto (7,0%) and Uberlândia
(5,6%) are also important locations. Those five municipalities and zones of influence account
for more than half (52,1%) of Brazil’s biotechnology companies. Belo Horizonte, Campinas
and São Paulo, together, account for 40% of the sec tor.

Three major biotechnology poles in Brazil




Belo Horizonte

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BOX 3. Brazilian Biotech Sector: Facts and figures
- Most of the companies concentrate their activities in Agriculture and Reagents followed by Animal and Human health;
- Most of them are relatively young, an indication that the sector is growing, ¼ were founded on or af ter 2005, ½ on or
after 2002 and ¾ of the total sample are approximat ely 10 years old;
- 75% of the total are small-sized companies (which we define as companies with revenues of up to R$ 1.000.000,00
reais/year or approximately 500.000,00 dollars/year);
- The Southeastern states, Minas Gerais (29,6%) and São Paulo (42,3%), are home to the most companies. Together, both
states are home to 7 out of 10 biotechnology companies;
- Incubators have a very important role and are responsible for a growing number of biotechnology companies in several
states throughout the country. Incubated biotech companies account for 35,2% of the total number.


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3. Brazil: a new hotbed for investments in biotech

3.1. Agribusiness and Green Biotechnology


The main concern facing agribusiness today is how to overcome the challenge of improving
production and efficiency in order to meet the growing demand for raw materials and food.
Other related concerns include identifying and combating diseases, strengthening resistance to
adverse environmental conditions and increasing income from farming. In this context,
biotechnology plays a fundamental role in addressing these main needs.
The synergy between green biotechnology and the agribusiness sector has been firmly
established on a world scale. This is shown by the increased areas planted with genetically
modified organisms (GMOs) in various countries. A report from the International Service for
the Acquisition of Agri-biotech Applications (ISAAA), a non-profit that tracks industry trends,
charts the dramatic growth in the 12 years that GMOs have been commercially available. The
area planted with transgenic crops rose by 12% in 2007, with estimated crop value climbing to
almost US$7billions. According to Cropnosis, an industry consultancy, this mark is expected to
reach US$8.4 billion by 2011.
Brazil surpasses US in new transgenic crop plantings in 2007

In 2007, Brazil planted 3.5 million (28% of all crops) new hectares of transgenic crops,
whereas the United States added only 3.1 million (25%). Globally, herbicide- or insect-resistant
soybeans, maize and cotton predominated, although yield/nutritional quality traits and stacked
traits rose in popularity.



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The strength of Brazilian Agribusiness: natural assets plus cutting-edge agricultural
research
Brazilian agribusiness exports totaled US$ 58.4 billion in 2007, an increase of 18.2% compared
to the previous year, according to data disclosed by the Ministry of Agriculture, Livestock and
Supply. Brazil is the world’s leading producer and exporter of coffee, sugar, alcohol and
concentrated orange juice. Besides, the country is the main farming frontier in the world, not
only due to an expansion in area but also in terms of potential increase in productivity achieved
by cutting-edge agricultural research carried out inside the country. According to the United
Nations Conference on Trade and Development, Brazil will become the world’s biggest food
producer within the next decade.
In Brazil, a significant part of the biotechnology companies in the agribusiness sector are
engaged in the production and marketing of improved seeds, with the participation of major
multinational corporations such as Monsanto and DuPont. But there are also companies
operating in other fields, e.g. the production of seedlings and matrixes, of inoculants, and
biological control.
The acknowledgment of the importance of research to the competitive edge in agribusiness has
lead several agents to promote and intensify scientific development in Brazil, leading the
country to become one of the very few developing countries in the world with a strong
infrastructure in agricultural research.
The leading position in the Brazilian biotechnology research network is held by the public
sector, but it also counts on the participation of several private companies directly involved in
the expansion of knowledge and its commercial applications. The progress of research in green
biotechnology in Brazil shows that the country is achieving significant results in two main
areas: transgenics and genomics.
Transgenic research in Brazil is conducted under the leadership of public institutions, such as
the Brazilian Agricultural Research Corporation's (Empresa Brasileira de Pesquisa
Agropecuária – Embrapa) and a number of universities, with the participation of private
domestic and multinational corporations. Research is geared not only to the development of
GMOs with agronomic properties, e.g. resistance to plagues and tolerance to pesticides, but
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also to the development of transgenic organisms with improved features, e.g. strain of
eucalyptus with a greater cellulose output.
BOX 4. Transgenic plants: some examples from Brazil.

Brazilian Corn to Produce Growth Hormone
– Developed by the Molecular Biology and Genetic Engineering
Center of the State University of Campinas (Unicamp) and the Chemistry Institute of the University of São
Paulo (USP), these plants are ready to produce 250 grams of the hormone per ton of seeds – enough to treat
hundreds of patients for months. The hormone is identical to the human form, and therefore better than the
bacterial source that has one extra amino acid. It proved to be cheaper to produce and extract.
Papaya Resistant to Brazilian Strain of Ring Spot Virus
– Developed in collaboration with Cornell University,
these plants have been tested in greenhouses in Geneva, N.Y., and have now been transferred to Embrapa in
Brasilia for field tests. In two years they should be ready for large-scale tests and should be as successful as
their cousins being planted in Hawaii. The technology will bring the opportunity of papaya cultivation back to
small farmers in areas where the crop has been decimated by virus disease. However, if the antibiotic marker
is proven to be a real problem under Brazilian conditions, then another four to five years will be necessary to
reconstruct the material.
Common Beans Resistant to Golden Mosaic Virus
– Developed by Embrapa – Rice and Beans Center –these
plants are undergoing greenhouse tests after a long research period, due to the difficulty of adapting existing
technology to the specific virus strain. Researchers expect to complete the cross-breeding of the characteristic
into commercial lines in two to three years
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3.2. Biofuels: Brazil leads the way


No other country is better placed to cash in on the global craze for biofuels.
With world oil prices hovering around US$100 per barrel and growing concerns over global
warming, countries are allocating more resources to develop technologies for renewable,
cleaner burning fuels. As owner of the world’s last major tropical rainforest, one of the largest
renewable reserves of fresh water, the planet’s most diverse stock of biodiversity, the best
energy matrix among major countries, and the most successful industrial-scale production of
renewable fuels, Brazil has what it takes to become an environmental power.



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"Brazil: Biotechnology and Agriculture to Meet the Challenges of Increased Food Production." Sampaio, M.

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Brazilian Ethanol Experience
Brazil’s extensive use of ethanol made from sugarcane is the most ambitious and successful
initiative developed to date for producing a biomass-based, renewable liquid fuel. Biofuels are
key components for diversifying the energy mix – crucial for energy security – and have
positive economic, social and environmental impacts.
Sugarcane agribusiness is a sustainable economic activity responsible for 1.6% of GDP, and 3.6
million direct jobs. There is no competition between food crops and energy crops. In 2006, the
sugarcane growing area corresponded to less than 10% of the total area under cultivation, a
small percentage of the country’s total fertile land.
About half of the sugarcane grown in Brazil is used to produce sugar - Brazil being the largest
producer and exporter - and the other half to produce ethanol. In 2006, 17.2 billion liters of
ethanol were produced. There are currently 330 sugar and ethanol mills in operation and a
further one hundred or so are now being built. Brazil is the most efficient producer of ethanol in
the world. The cost of producing ethanol from sugarcane in Brazil is significantly lower than
that of the ethanol produced from maize in the United States and from wheat and sugar beet in
Europe.
Eighty-five per cent of sugarcane production takes place in the southern central region of Brazil
and the remaining 15% in the north and northeastern region. No sugarcane is planted in the
rainforests of the Amazon region: neither its climate nor soil are suitable for large scale sugar
cane plantations.
Brazil has developed a comprehensive R&D system in the sugarcane/ethanol sector. Research
programmes have been established on the whole production chain, from variety selection to
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industrial processes in the mills. Variety selection has been the most influential factor in
improving sugarcane yields.
A key technological breakthrough in the consolidation of the biofuels sector in Brazil was the
introduction in 2003 of flex-fuel vehicles. The consumer has been afforded the flexibility to
choose at the pump between gasoline, alcohol or any combination of the two. About five
million cars in Brazil run daily ONLY on this fuel and another nine million cars run on a
gasoline/alcohol mixture. It is estimated that about 70 percent of Brazilian cars and trucks are
flex-fuel, and that 40 percent of Brazil's non-diesel fuel has been replaced by ethanol
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.
In 2007, Presidents Bush and Lula struck an U.S. Brazil bioethanol agreement in line with the
Bush government's plan to reduce current traditional U.S. gasoline usage by 20 percent over the
next 10 years. It has been projected that this will require about 35 billion gallons per year by
2017, versus the current level of five billion gallons per year in the U.S.
Brazil’s Biodiesel Rush
The Brazilian government has launched a program that will make a blend of biodiesel—made
from vegetable oils and ethanol—mandatory in the na tional fuel supply by 2008, with the
expressed purpose of creating sources of income for many small family farmers in the poor,
drought-plagued northeastern region of the otherwise fertile agricultural.
An ambitious national plan
The mandate to mix 2% of biodiesel to diesel, due to come into force in two and a half years,
will require 840 million liters of biodiesel annually and create jobs for more than 150,000 small
farmers, according to Brazil’s Science and Technology Ministry. By 2013, the 5% mandate will
require 2.4 billion liters of biodiesel per year, according to estimates from Brazil’s main
vegetable oils industry association. In an effort to meet this growing demand, several large-
scale plants are being built.
New plants being developed
According to the recently formed Brazilian Biodiesel Industries Association (ABiodiesel), eight
new projects are currently in development: Ecologica Mato Grosso Industria and Comercio
Ltda. (Ecomat); Ceralit; Adequim; Biolix, AgroDiesel; Fusermann Biodiesel; Petroquimica
Capital (Petrocap); and Brasil Ecodiesel. Petrocap, the largest of this group is scheduled to
inaugurate a plant with a capacity to produce 300 million liters per year. These eight projects,
combined with Agropalma and SoyMinas plants now in production, are expected to put out
more than 450 million liters of biodiesel annually by 2008.


4
“Clean energy: the Brazilian ethanol experience”. Ministry of External Relations. Embassy of Brazil in
London, 2007.

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BOX 4. Sugarcane Agro-Industry: Perspectives and Opportunities
International Market:

• Japan 3% Mixture: 1.8 billion litters of ethanol;
• USA – Energy Policy Act - 2005: Creates an ethanol mandate requiring fuel manufacturers to use 28,4 billion
litters of ethanol in gasoline by 2012;
• EU – Increase of demand for biofuels (ethanol and biodiesel).
Results:

• Increase of the global demand of ethanol;
• Increase of the ethanol international trade flow between producers and consumers.
Brazilian Production Forecast (2013):

• Ethanol: 30.85 billion litters
• Internal Market: 24.95 billion litters
• Exports: 5.90 billion litters
Considering the ongoing investment there is an opportunity for investment in processing units for 160 million
tons of sugarcane.
Ethanol Perspectives: Aviation Industry

Embraer, a Brazilian company and one of the largest aircraft manufacturers in the world, sold in 2005 the first 100%
ethanol aircraft (EMB-202), a single-seat agricultural utility. For that achievement, the company was awarded with the
prizes "Flight International Aerospace Industry Award" General Aviation category (June /2005) and The Scientific
American 50 (December/2005) as one of the best inventions of the year in the world. Afterwards, Embraer announced the
development of the first aircraft with Flex-Fuel technology in partnership with an Italian company.

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3.3. Pharmaceuticals and health biotechnology


The Brazilian pharmaceutical market reached US$10.8 billions in February 2008
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becoming the
largest in Latin America and the 9
th
largest in the world. It is expected to grow at a 12% annual
rate, driven mostly by the rapidly developing generics sector.
The generics segment in Brazil
An expanding market, a growing population, a regulatory regime supportive of the generics
sector, robust domestic production and many untapped opportunities.
The introduction of generics in Brazil in 1999 represented a new front for the Pharmaceutical
Industry, stimulating investments of over R$ 1 billion. In the middle of 2006, there were 10,703
commercial presentations in the country, produced by 68 laboratories
6
. The Brazilian
Association of Generic Medicine Industries (Pró-gen éricos) announced generics sales of
US$1.5 billion in 2007, 44% higher than the previous year.
Development of the sector has been assisted by the government's public education campaign,
complemented by pharmacy promotion of generics. Heightened consumer awareness is the
main driver of generic sale with 95% of Brazilians familiar with the concept of a generic,
according to a national survey conducted by the Ministry of Health. Furthermore, the
availability of a broad range of generics has been boosted by the rapid regulatory approval
process.
The generics market, already in a strong growth phase, is well placed to continue its future
expansion. The generic production of oral contraceptives and endogenous hormones was
approved in March 2007, a number of leading brands are due to lose their patent protection
over the next 5 years and the use of generic drugs is expected to grow as price pressures bite
7
.

Domestic producers dominate
Local companies currently dominate the Brazilian generic market, with EMS and Medley
together accounting for over 50% of sales. There were 66 producers with registration of generic
medicines in 2006, but the four leading producers, which are domestic companies, controlled


5
“Sales Through Retail Pharmacies (Twelve months to February 2008”). IMS Retail Drug Monitor from IMS
Health.
6
“A indústria farmacêutica no Brasil” FEBRAFARMA.
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“Opportunities and Challenges for Bioequivalent Generic Drugs in Brazil.” Espicom Business Intelligence
Ltd, April 2007, Pages: 190.

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over 80% of the sector. Mergers & acquisitions will continue to consolidate the Brazilian
generics market
3
.



Domestic producers dominate…for now?
Attracted by financial incentives, major international generics companies are setting up
production facilities in Brazil. Multinational suppliers are also seeking to gain a share of the
expanding market, with Novartis and Abbott, for example, already present. It is probably only a
question of time before the domination of the market by local companies changes.

Conducting clinical trials in Brazil
Clinical trials account for two thirds of the development cost for new drugs and offshoring is
becoming a common way to help pharma firms keep costs down by providing access to a new
range of patients. As a result, in 2005 almost half of the 1200 clinical trials conducted by the 12
largest US pharmaceutical companies included an offshore location, according to an analysis by
consulting firm A.T. Kearney.
With that in mind, the consulting firm developed the Country Attractiveness Index for Clinical
Trials. The Index provides a fact-based ranking of low-cost countries and highlights the
evolving clinical trials landscape.
The attractiveness of offshore locations was determined by evaluating five key areas: patient
availability, cost efficiency, relevant expertise, regulatory conditions and national
infrastructure.
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China, India and Russia ranked as the top 3 with Brazil following closely behind. Analyzing the
individual factors, however, Brazil has better infrastructure and environment than all other
three, better regulatory conditions than China and India, and higher patient pool than Russia.
Brazil is from many points of view a good environment to carry out clinical trials. Lower costs
(relative to US and Europe) as well as qualified professionals and CROs are some of its
strengths. Brazil’s large, varied and highly multiethnic population allows studying all types of
diseases. Furthermore, as a lower proportion of the population has had access to complex drugs,
many patients could still be considered “drug-naïve ” and would be of interest for clinical trials.
Brazil has about 205 physicians per 100,000 of the population, which represents a potentially
large pool of investigators for clinical studies. Many of these physicians have followed post-
grad training in the US and Europe and so clinical practice in reference hospitals is aligned with
international clinical guidelines. At major universities, physicians have already been trained in
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GCP and are experienced in multi-center international clinical trials in conformity with US-
IND or EU guidelines
8
.
There is also a great interest in Brazil for pre-clinical studies and clinical phase I studies, but
this has not historically been a strength of the Brazilian clinical research, rather focused on
human studies and immunization programs. Brazil’s strengths rather lay in phase II, III and
post-launch studies, where the assets of the population characteristics can best be employed.
However, there is no doubt that over the years, phase I capabilities will develop in Brazil
9
.



8
Faiz Kermani, Regional roundup: Brazil, Contract Pharma, October 2005.

9
Máxime Riché. “Opportunities for UK Companies in Biopharmaceuticals and Biotechnology in Brazil.” June
2006. MPhil in Bioscience Enterprise. University of Cambridge.
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BOX 5. Why offshore clinical trials in Brazil?
Why Brazil from the Country’s Perspectives:
• Ethnical diversity and high degree of interracial marriage makes its population multifaceted with a
predominance of Caucasians.
• Prevalence of diseases equivalent to world
• Seasonal diseases, all year long
• Clinical trial costs can be as low as 65% and 50% of the costs in North America and European Countries
respectively.
• Attractive market for turnkey mega research projects
• High enrollment rates
￿ Large pool of treatment-naïve subjects
￿ Excellent patient compliance and retention

Why Brazil from the Investigators and Sites Perspectives:
• World class investigators
￿ 96 Medical Schools, 76% in the South and South-Eastern region
￿ World-class medical technology in several areas of medicine
￿ Nearly 8,000 hospitals, both general and specialized, concentrated in the main metropolitan areas
￿ Estimated number of physicians: 200 thousands, concentrated in metropolitan areas
• Strong adherence to ICH-GCP norms and alignment with target practice guidelines
• Large experience in clinical trials (National and International)
• Strong patient-doctor relationship resulting in good patient compliance and retention rates
￿ Exec. Director of MSD in Center Watch: “Drop-out rates are about half of what you see elsewhere.”
• World class sites
￿ High technology
￿ Data reliability
￿ Internationally audited (FDA, EMEA)
￿ Effectively works with CROs, Pharma Industries and Biotech Companies
￿ Well trained and deeply involved professionals
￿ World class infrastructure

Why Brazil from the Regulatory and Standards of Care Perspectives:
• World-class Regulatory and Consistent Standards of Care
• Three instances of approval (IRB, CONEP, ANVISA)
• Consistent standards of care
￿ I.e.: AIDS, Hepatitis, Kidney transplantation, etc.
• Reference Research Centers of several diseases
￿ I.e.: Oncology, Cardiology, Infectious Disease, Nephrology, etc.
• Central and local laboratories, compliant with GLP and Certified by College of American Pathologists.


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The Brazilian Vaccine Market
“While the twentieth century was the century of ant ibiotics, the twenty-first will be the century
of vaccines.” Sabin Institute
Vaccines, seen as commodity products earlier, used to be considered a low growth, low margin
industry in developed countries and with no margin at all in developing ones. However, the
market is currently at the centre of attraction for all leading pharmaceutical giants, says “Global
Vaccine Market Outlook (2007-2010)”, a market research report by RNCOS. The report says
that the vaccine market is registering growth rates much faster than the conventional pharma
market and, with several blockbuster potential vaccines slated to hit the market in near future,
the growth is projected to rise even faster.
Brazil’s strategy for the vaccine field is certainly one of the most successful in the group of
developing countries, and has kept pace quite closely with the international movement. In
recent history, intervention by the State is beginning to occur in a more systematic, planned
manner with the successful campaign to eradicate smallpox, which started in the 60s and ended
in 1973, and with the setting up of vaccination programs like the National Plan to Control
Poliomyelitis, as well as other local experiences. Also in 1973, the State’s role in the field took
a quantum leap with the creation of the National Immunization Program (Programa Nacional de
Imunizações, PNI) – an integral part of the WHO’s E xpanded Program of Immunization –
which sets out progressive vaccination strategies for the major immunization-preventable
diseases with high national or regional incidence.
A noteworthy result of this health policy priority and strong social mobilization is that the last
recorded case of poliomyelitis was in 1989, and Brazil was awarded the certificate of
eradication of autochthonous wild polio virus in 1994. In more general terms, vaccine coverage
was extended from around 20% when the PNI was set up, to around 90% of the target
population of the set of vaccines provided.
In this context, the Immunobiologicals Self-sufficiency Program (Programa de Autosuficiência
em Imunobiológicos, PASNI ) was formulated in 1986 with a view to encouraging national
production by a group of public institutions that had a rather more developed technology base.
For this purpose, between 1986 and 1998, the Federal Government channeled a total of
approximately US$ 150 million for these producers to invest in production capacity and
quality. Although the goals of self-sufficiency have not yet been attained, Brazil has installed
the largest vaccine production capability in Latin America. In 2004, 96% of polio vaccinations
used in Brazil was produced domestically and, in 2005, Brazil became the first developing
country to introduce the Rotavirus vaccine in the public sector.
Bio-Manguinhos and Butantan (BOX 6 and 7), the two main Brazilian vaccine producers, are
public entities with health goals focused primarily on the Brazilian market. The Brazilian
national immunization program is strong and this, combined with the large number of new
infants born each year, generates substantial demand for vaccines.
24

In 2004, the vaccine market in Brazil reached US$ 221 million, 43% of which was destined to
the private sector, mainly with the Hepatitis B vaccine. The general profile and needs of the
market is shown in the table below.


25

Beyond the provision of low-cost vaccines to the broadest base of patients, public laboratories
are eager to develop new vaccines. There is a great expertise in the vaccine domain in Brazil,
but many opportunities exist to build on this expertise to scale up the production of traditional
vaccines for exportation and develop new market opportunities
10
. Finally, the following table
summarizes the factors of competitiveness of the Brazilian Industrial Vaccine Complex:



10
Máxime Riché. “Opportunities for UK Companies in Biopharmaceuticals and Biotechnology in Brazil.” June
2006. MPhil in Bioscience Enterprise. University of Cambridge.


26

BOX 6. Immunobiologicals Technology Institute (Bio-Manguinhos/ FIOCRUZ)
The Immunobiological Technology Institute is the largest producer of vaccines and diagnostic kits of infectious and
parasitic diseases in Latin America. The unit is capable of processing over 200 million doses of vaccines per year. It
is also the world's largest producer of vaccine against yellow fever, supplying up to 100 million doses a year to meet
Brazilian and export requirements.
The institute was created in 1976 and from the 1990s onwards assumed the strategic role of pursuing self-sufficiency in
the production of some immunobiologicals. Besides vaccines against yellow fever, Bio-Manguinhos makes vaccines
against measles, poliomyelitis, meningitis meningococus A/C and by Haemophillus influenzae type B, dipthteria,
tetanus, whooping cough and MMR triple vaccine (against measles, mumps and rubella). Between 2001 and 2004, the
institute produced around 320 million vaccine doses, being recognized, in 2001, as an international supplier of yellow
fever vaccine by the World Health Organization.
As to vaccines, there is research being conducted on a recombinant BCG vaccine, on a combination against rubella and
measles, on a pentavalent vaccine (Hepatitis type B combined with DTP and Hib vaccines) and on vaccines against
dengue fever, enteropathogenic Escherichia coli, Meningitis types B and C, pneumonia caused by Streptococus
pneumoniae and Rubella. Fiocruz, together with the George Washington University and other foreign institutions is also
part of an initiative to develop a vaccine against hookworm infection.
For the past decades, the Institute has striven to develop a capability to produce vaccines in bulk quantities by GMP
standards and form partnerships with large multinational pharmaceutical companies in order to serve the global market.

27

BOX 7. The Butantan Institute
Established in 1901, the Butantan Institute is a biomedicine research centre responsible for over 80% of the production of
serum and vaccines in Brazil, according to information supplied by the organization. It is renowned for its research on
poisonous animals and for the production of serums against bites by these animals. The organizations' collection of
serpents counts on 54,000 animals.
It is a major producer throughout Latin America of diphtheria, tetanus, pertussis, hepatitis B and BCG vaccines (188
million doses in 2003). In a recent initiative, the Institute has committed to producing an avian flu vaccine in the next
three years, and has capability for GMP production of monoclonal antibodies. There are also plans for preparation of
recombinant therapeutic proteins such as insulin and erythropoietin.
Scientists at Butantan Institute have also played a key role in the transcriptome of Schistosoma mansoni, which has been
used successfully to identify antigens for a candidate vaccine. A thriving research arm in both applied and basic research
boasts 121 investigators.
Today Butantan masters a number of basic technologies which will allow the implementation of next generation
immunobiologicals:
• Large scale aerobe an anaerobe bacterial fermentation
• Long term animal cell cultivation for production of viruses and recombinant proteins
• Large scale protein purification by chromatography methods
• Large scale purification of polysaccharides
• Large scale continuous and gradient centrifugation
• Tangential and molecular filtration
• Construction of recombinants and expression
• Biologicals and vaccine assays and regulatory assays
• Design of GMP plants
• Complete genomics




28

Biodiversity-based products

Brazil has the world’s greatest biological diversity, and the Amazon region alone represents
26% of the world's remaining tropical forests. Along with 15 other countries, including India,
Brazil accounts for 70% of the world's animal and plant species.
Natural products are becoming increasingly valuable in today’s society. In response to this
trend, important shifts are occurring in many industrial sectors, such as food, drink, cosmetics
and pharmaceuticals, mainly because of growing public opinion on the benefits of a “lifestyle
in harmony with nature”. Since meeting consumer needs and expectations are of primary
importance for companies’ competitiveness, there is a gold race for the use of natural elements
as raw materials to develop a wide variety of products
11
.
In what regards the discovery and development of new pharmaceuticals, natural products play
an important role as starting materials to produce synthetic drugs, or as lead compounds from
which a totally synthetic drug is designed. Ten of the world's 25 top-selling drugs in 2000 were
derived from natural sources. More than 60% of drugs approved from 1981-2002 could be
traced to or were inspired by natural products. The global market value of pharmaceuticals
derived from genetic resources is estimated at US$75 billion to 150 billion annually. Some 75
per cent of the world’s population relies for health care on traditional medicines, which are
derived directly from natural sources
12
.
The great diversity of the Cerrado, Amazon rainforest, Pantanal wetlands, Caatinga region,
Araucária and Atlantic forests makes Brazil the partner of choice to find novel molecules,
whether for drug discovery, cosmetics or natural products.




11
Moreira, A.C., Muller, A.A., Pereira Jr, N, Antunes, A.M. “Pharmaceutical patents on plant derived materials
in Brazil: policy, law and statistics.” World Patent Information 28 (2006) 34-42.
12
Global Environment Outlook 3 (2003)
29

Major biomes of Brazil


Source: Brandon et al.” Challenges and Opportunities in Brazilian Conservation.” Conservation Biology. Volume 19, No.
3 (2005).
The 1995 Convention on Biological Diversity (CBD) and the Bonn Guidelines on Access and
Benefit-Sharing provide the basis for building partnerships that enable countries like Brazil to
use the potential of their biodiversity in a sustainable and equitable manner.
Public and private research centers of very high standard in Brazil have great expertise in
extraction and screening of natural compounds. In licensing novel compounds, techniques or
technologies from Brazil’s impressive and world-class R&D output is a major opportunity to be
pursued by foreign companies
13
.



13
Máxime Riché. “Opportunities for UK Companies in Biopharmaceuticals and Biotechnology in Brazil.” June
2006. MPhil in Bioscience Enterprise. University of Cambridge.

30

4. Growth in Brazilian Biotech spurred by a favorable environment

The National Policy for Biotechnology: Brazil to seek global leadership


President Luiz Inácio Lula da Silva signed a decree in 2007 outlining a development policy for
the biotechnology industry in the country: The National Policy for Biotechnology. Five
ministries and representatives of the academic and private sectors are working together for
Brazil to become the global leader in the sector in 10 to 15 years.
There are currently 1,700 groups in the public, academic and private sectors working in the
biotechnology sector in Brazil. The national program will manage and provide support to these
activities, as well as facilitate corporate access to research results.
The plan calls for investments of R$10 billion (equivalent to U$5,8 billion) over the next
decade, what would lead to a 5-year doubling of the number of start-up companies as well as
the creation of 20 Ph.D. programs. The goal is to encourage biotechnological applications in
five different fields: health, food security, animal health, industrial products and environmental
quality.
Brazilian Innovation Law: the first national innovation law of Latin America


Organized with three purposes: fostering of a favorable environment for strategic partnerships
between universities, technology institutes and companies; stimulus for participation of
scientific and technological institutes in the innovation process; and stimulus for innovation
within companies.
The Innovation Law allows public funds to be spent on industrial projects. It encourages public
and private sectors to share staff, funding and facilities thus increasing technology transfers
between universities and the industry. Intellectual property held by universities may now be
licensed out, allowing the commercial utilization of publicly sponsored inventions by private
companies. Universities will also be able to grant their own researchers 5-year renewable
licenses to establish businesses to develop promising innovations. A government initiative for
technology transfer from overseas also allows a period of five years access to the Brazilian
market before the transfer of production techniques for local manufacture.
This law contains clear provisions for joint ownership of patents, which will allow academic
institutions to incubate both joint ventures and private companies. This new law is extremely
important, and is somewhat similar to the Bay-Dohle Act in 1980 in the US, that had a huge
impact on spin-out and technology transfer activities in public universities. This gives positive
expectations about how technology transfer agreements could grow in coming years in Brazil.

31

Law of Good (Lei do Bem): fiscal incentives to boost innovation and investments


Implemented in 2005, this law provides tax breaks and grants to stimulate innovative
companies and foreign investments. The Brazilian tax authority lowered the tax rate to 15%
(from 22%) on capital gains to non-exempt local investors, and issued a new exemption to
foreign investors that are not based in tax free jurisdictions.

This law also establishes tax credit to private companies such as biotechs that would allow
them to deduct 60% of money spent on R&D from their annual tax. In parallel, a company
hiring more than 5% new research staff can benefit from tax cuts of 80% of the scientist’s
salary.
The New Brazilian Intellectual Property Law: a competitive legal framework


This law was established in 1996 and complies with the TRIPS agreement. It brought a greater
protection for pharmaceutical, food and chemical products, ending a fifty-year prohibition of
their patentability. Plant varieties and animals are not subject to patent protection but the law
did not rule out transgenic microorganisms, which are patentable in Brazil. In what regard plant
variety protection, Brazil is a member of the 1978 UPOV Act and set up a parallel regime of
protection regulamented by a separate law.
Biosafety Law: regulating biotech activities


Proposed in 2005, this law regulates biotech activities and allows the production of genetically
modified organisms. It sets a framework for the use of embryonic stem cells in research,
permitting the use of blastocytes, which have been surplus to requirements for in-vitro
fertilization procedures and frozen for three years.

Two governmental bodies are in charge in Brazil to deal with biosafety-related issues, as
follows: National Biosafety Council, associated to the Presidency of the Republic, is a high-
level entity for advising the President in matters related to the formulation and the
implementation of the National Biosafety Policy; National Biosafety Technical Commission
(CTNBio), which is part of the Ministry of Science and Technology, is a consulting and
deliberating multidisciplinary collegiate that provides technical and assistance support to the
Federal government to formulate, update and implement the National Biosafety Policy for
GMOs and their by-products, as well as establishes safety technical norms regarding the of
research-related activities and the commercial use of GMOs and their by-products, based on the
evaluation of their zoo-phytosanitary, human health and environmental risk.

32

Public schemes for funding biotechnology activities in Brazil


S&T Sectoral Funds
Strategic programs of the Ministry of Science and Technology (MCT) that orient the Federal
Government’s Industrial, Technological and Foreign Trade Policies (PITCE). With resources
from the National Science and Technology Development Fund (FNDCT), these instruments
support research projects, development, and innovation in Brazil.

A Biotechnology Sectoral Fund was created in 2001 and has invested expressive resources in
the organization of genome networks and biotechnological projects relevant to agriculture
(germplasm banks, culture collections) and health (phytomedicines and biopharmaceuticals).

The Brazilian Development Bank (BNDES) lines of credit
BNDES has expanded its lines of credit to fit the financing needs of high technological sectors.
Some of these programs include: PROFARMA, dedicated to support the development of a
Production Chain for the Pharmaceutical Industry; FUNTEC, a technology fund that aims to
provide financing to stimulate technological development and innovation of national interest
and CRIATEC, a program for non-refundable seed money investments in strategic areas,
including biotechnology.
The Brazilian Innovation Agency (FINEP) financing activities
FINEP provides grants, i.e. non-reimbursable funds, and loans. The agency supports every
stage and dimension of the scientific and technological development cycle: basic and applied
research, product, service and process innovation. FINEP also supports incubation of high-tech
firms, implementation of technology facilities, structuring and consolidation of research
processes, development and innovation in established companies, and market development. In
2008, the agency has announced a budget of R$2, 55 billions to be invested on the development
of innovative products and processes. In 2007, investments reached R$1,9 billions
14
.

Non-reimbursable funds are granted with FNDCT funds, currently formed largely by the before
mentioned S&T Sectoral Funds. They are intended for non-profit institutions, for programs and
fields specified by the Funds’ Managing Committees.

Reimbursable loans are made with FINEP’s own funds or through on-lending from other
sources. Those businesses or organizations interested in receiving credit may submit their
applications to FINEP at any time.
Recently, FINEP has created new instruments to support nascent high-tech firms. Some have
been developed in the Inovar Project, supported by the Inter-American Development Bank
(IDB). This includes investments provided mainly through venture capital funds. Another
instrument is the Program for supporting research in enterprises (Programa de Apoio a
Pesquisa em Empresas - PAPPE), a program to provide research grants to individuals in small
companies, similar to the Small Business Innovation Research Program (SBIR), in the US.

Finally, FINEP also manages RHAE Grants, a program that award scholarships to businesses or
institutions that undertake scientific and/or technological activities aiming at employing experts


14
FINEP, Ministry of Science and Technology.
www.finep.gov.br

33

to work in short term projects (approved by FINEP and operated by CNPq, the National
Council for Scientific and Technological Development).

Private funding of biotechnology initiatives in Brazil


The private mechanisms for financing a biotechnology company in Brazil are still incipient. As
of 2007, there were 9 venture capital firms in Brazil which are focused on or have interest in
Biotechnology.


It is expected that the VC industry will consolidate in the country in the following years,
expanding the level of investments and, consequently, the availability of private financing for
biotech companies.
Also, we can observe in the last couple of years a strong interest from the Brazilian
Pharmaceutical Industry in innovative products, especially biotechnology-related ones. Some of
these companies are creating their own departments for analysis of opportunities and product
development, while others are establishing consortium to finance R&D activities. The
Consortium of Pharmaceutical Industries (COINFAR), created by three of the most important
local pharma companies is a good example of such cooperative development of technologies
and products (BOX 8).
34

BOX 8. COINFAR: Partnering for Growth
COINFAR (Consortium of Brazilian Pharmaceutical Companies) is a joint venture of three Brazilian pharmaceutical
companies (Aché, Biolab Sanus and União Química) fo cused on the discovery and initial phases of development (clinical
phases I/II) of biopharmaceutical drugs. It works closely to Universities and Research Institutes, both in Brazil and
abroad. COINFAR has a patent portfolio comprised of 8 issued patents and 36 applications waiting for approval in
countries such as US, Japan, India and China.
The company has two candidates undergoing preclinical studies: an endogenous vasopeptidase inhibitor (EVASIN), a
type of anti-hypertensive derived from the venom of a Brazilian snake, and an analgesic for chronic and neuropathic pain,
also derived from snake venom. Another lead compound is a recombinant protein from tick saliva shown to be active
against melanoma.
Since its inception, COINFAR has had significant investments from both public and private sources, including US$4M
from its shareholders and US$3.8M from government grants. The company plans to invest further on prospecting
activities, forge further collaborations and start an affiliate company in the US in the coming year.

35

5. Who is who in the Brazilian Biotech Market


5.1. Top-tier players


Aché Laboratórios S.A: focus on innovation
Headquartered in Greater São Paulo, Aché has one of the largest sales forces in the pharmaceuticals sector in the country,
with around 2,800 collaborators and three industrial plants. It supplies 250 therapeutic alternatives, with consolidated
operations and a large portfolio of prescription medicines, OTCs (over the counter) and generic medicines.
The company is investing heavily in R&D of phytomedicines - products developed from standardized Brazilian plant
extracts and based on safety and effectiveness studies. At the present time, Aché has seven products o f this range on the
market. Especial attention should be drawn to Acheflan® – an anti-inflammatory medicine completely researched and
developed in Brazil. It was launched in June 2005 and involved seven years of study and investments of around US$ 8
million.
Besides several partnerships with foreign institutions, Aché currently plans a joint venture with a fo reign firm to construct
a factory for the production of biotech-based medicines.

Allellyx Applied Genomics: bringing solutions for agribusiness
Alellyx is a scientific research and development company which creates technological knowledge applied to finding new
solutions for agribusiness. The company was founded in February 2002 by a group of five molecular biologists and
biotechnologists involved in Genome Projects in Brazil and abroad. The company received an investment of
approximately US$15 million by a Brazilian Venture Capital Firm (Votorantim Ventures/ Sao Paulo).
Alellyx uses scientific research to create plants which are genetically improved by molecular biology methods and result
in higher added value products. These plants have a positive impact on the agricultural sector at domestic and world level
and bring benefits which are not only commercial but also social and environmental. The company has researched
platforms for the cultivation of sugar cane, eucalyptus and oranges, raw materials which are having a direct impact on the
good results the agribusiness is enjoying, due to their higher productivity and viability.

BIOMM: a young pioneer
Biomm is a biotechnology company that was created in December of 2001 in Belo Horizonte, as a Biobrás spin-off, at that
time the fourth-largest world producer of insulin. After 25 years leadership in the treatment of diabetes in Brazil, Biobrás
was partially acquired by the Danish company Novo Nordisk at the beginning of 2002. In the deal, the researchers and
main executives were transferred to Biomm with basically the same group of shareholders. Biomm also retained the
intellectual property rights on the technology platform to produce recombinant proteins (genetic engineering), and more
specifically, of Human Insulin, a technology that few companies in the world possess, in addition to the business related
with insulin and this technology. This technology enables the production of insulin through a process that does not depend
36

on raw material of an animal origin, provides an increase in the availability of the product and, by means of
complementary development, enables other recombinant proteins to be obtained, such as growth hormones, monoclonal
antibodies and insulin analogues. Developed by researchers that are currently with Biomm, this technology was
industrially tested and is protected by patents in the USA, Europe and Asia. First Biotechnology Company in Brazil to be
publicly listed.
CanaVialis: revolutionizing the sugarcane industry
CanaVialis was founded in March 2003, the result of a partnership between a VC firm (Votorantim Ventures/ São Paulo)
and a group of scientists with over 30 years experience in the development of sugarcane varieties. The company has
developed one of the most modern and efficient genetic improvement and breeding programs in the world; a program
focused on developing varieties that are ever more capable of responding well to each customer's specific requirements.
Annually, the company plants some 2.3 million seedlings obtained from hybrid seeds produced at CanaVialis' own
Breeding Center in Brazil. The entire operation is supported by state-of-the-art technology which combines knowledge
and experience in genetic improvement and breeding with the most advanced process-control technologies available.
In 2007, CanaVialis signed an agreement with the Monsanto Company which will allow it to make available technologies
developed by Monsanto to the sugar and alcohol business sector. The initial products resulting from this agreement will be
insect attack resistant and herbicide-tolerant varieties. These technologies will allow CanaVialis customers to increase the
productivity of cane fields and decrease production costs.
Cryopraxis: enabling cell-based therapies of tomorrow
Cryopraxis is the largest stem cell and umbilical cord blood bank in Brazil and one of the few that have performed or
participated in clinical trials involving transplants of cell samples.
To realize the promise of novel cell-based therapies for many pervasive and debilitating diseases, Cryopraxis sponsors and
conducts several R&D projects. The company has ongoing preclinical trials on cellular differentiation and clinical trials
on heart malfunction, type I diabetes and neonatal hypoxia.
Furthermore, Cryopraxis has been actively forming partnerships, both inside and outside the country. Foreign
collaborations include that with Saneron CELL Therapeutics (Tampa, USA) for development of clinical trials using
umbilical cord blood; and with the Texas Heart Institute (Houston, USA) for the development of cell therapy procedures.
Eurofarma: innovation for life
30 years after its foundation, Eurofarma has become the third largest Brazilian pharmaceutical company. It manufactures
and commercializes approximately 260 pharmaceutical products encompassing the human (hospital, oncology, generic
and medical prescription) and veterinarian fields.
In 2005, Eurofarma began its activities in Biotechnology, after structuring a pilot plant and a highly qualified technical
team geared towards the production of recombinant proteins. In 2007, it started producing pilot batches of Filgrastim, a
recombinant G-CSF (granulocyte-colony stimulating factor) drug for treatment of cancer, licensed from an Israeli
biotechnology company.
37

Eurofarma’s project pipeline includes the development of a novel monoclonal antibody against Epidermal Growth Factor
Receptor (EGFR) for the treatment of solid tumors, a molecule for neutropenia treatment, disease-modifying
antirheumatic drugs, analgesic, antifungicide and antibiotics. The company has, also, partnered with local universities for
the development of new phytomedicines from Brazilian biodiversity.
Eurofarma is now building a modern industrial plant of approximately 80 thousand square meters of built-up area that
shall attend to current and future production demands of medications for the domestic and international markets, heeding
norms established by regulatory bodies like Anvisa, the FDA and the EMEA, from the European Union.
Farmacore: Expertise in R&D
Farmacore Biotecnologia is focused on carrying out screening, identification, research and development of products with
therapeutic and biotechnological potential. In addition to its own R&D platform, the company offers two classes of
services: R&D of biotechnology and nanotechnology products or processes, and drug screening programs.
Within the first category, Farmacore supports human resource training and the development of innovative products from
the conception of projects up to the supply of biodrugs for clinical trials. The company acts in the technology transfer,
protection of intellectual property, management of innovation projects, evaluation of technological feasibility, pre-clinical
and clinical studies of vaccines, medications and biodrugs in compliance with Good Laboratory Practices – GLP.
Within the second category of services lays the discovery and identification of new compounds with potential
antimycobacterial activity. A HTS platform allows the wide-scale screening of compounds both of natural (biodiversity)
and synthetic origin (chemical and organic). Performed tests include: Bioassay for Determination of the Minimum
Inhibitory Concentration (MIC), Bioassay of Cytotoxicity in cells (IC50), Bioassay of Intracellular Activity - Colony-
Forming Units (CFU) and Test of Surface Plasmon Resonance (SPR).
FK Biotecnologia: developing the imunotherapies of tomorrow
In 1999, FK Biotecnologia became the first Brazilian biotechnology firm to receive venture capital for the development of
its innovative technologies. Since then, the company has grown at a steady pace and is considered a pioneering example
of a successful biotech start-up in Brazil.
The company is focused on the development, production and commercialization of immunodiagnostic products and
anticancer vaccines. FK Biotecnologia balances its operations in these two major domains so as to raise funding and
increase its innovation capacity.
At present, the firm’s immunodiagnostics line has more than 70 items. In what regards the company product pipeline, it is
comprised of whole cell autologous anti-cancer vaccine in clinical trials for: prostate cancer (phase I/II complete) and
mieloma, ovarian, breast, pancreatic and renal cancers (phase I). Further ongoing projects are: development of monoclonal
antibodies against gastric, pancreatic and colon tumors; automated immunodiagnostics and ELISA (for PSA, HIV I/II and
others).
38

Intrials: fast enrollment and clinical research excellence
Intrials is a world-class, full-service Latin America CRO, based in Sao Paulo City, Brazil. In the light of the vast,
untapped opportunities in Latin America, Intrials initiated expansion to other Latin America countries in 2006. Thereby, it
has established offices in Buenos Aires, Santiago and, more recently, Mexico.
The company was launched in 1999 and has an impressive track record of providing clinical research services from Phase
II to Phase IV trials in 12 therapeutic areas including diagnosis. Intrials has provided services to nearly 120 trials, totaling
more than 5,900 patients (3,200 in vaccine trials) and 355 investigational sites.
Intrials is now open to establish collaborative agreements with organizations worldwide, in order to help accelerate
clinical development.
Oncocell Biotechnology: fighting cancer
Oncocell Biotechnology was founded in 2000 aimed at developing therapeutic products, primarily anti-cancer vaccines.
The most recent project developed by the company was “HybriCell”, the first anti-tumor vaccine discove red and produced
with 100% Brazilian technology. HybriCell has achieved stabilization records of about 80% in the cases of renal
carcinoma and melanoma. It is already available for the usage as an adjuvant in those diseases, being recently approved by
ANVISA (Brazilian National Agency of Sanitary Surveillance).
Predicting the advances in medicine, especially in the oncology area, OncoCell recently launched the first Center for
Obtaining and Preserving Viable Cells in Brazil. An innovative service that allows patients to store viable tumor cells to
produce vaccines or any other method of treatment indicated by their oncologist. Oncocell is a Genoa Group Company
(Genoa Biotecnologia maintains divisions in both human and veterinary areas).
Pele Nova Biotecnologia S/A: a pleasant surprise
Pele Nova Biotecnologia S/A (Sao Paulo) is a private company conceived and structured to launch, produce and trade a
pharmaceutical product developed from a fortuitous discovery.
While working on a technique to surgically repair esophageal lesions in dogs, two researchers at the University of Sao
Paulo discovered that one of the implanted latex materials utilized helped to regenerate esophageal tissue and restore
normal function. Recognizing its potential, they filed a patent for the product, a biomembrane, now referred to as
BIOCURE
®
. Applications have also been submitted in more than 60 countries with patents granted for parts of Europe.
BIOCURE
®
was approved by ANVISA (Brazilian National Agency of Sanitary Surveillance) in 2004 and is being used
for wound healing applications including: diabetic ulcers, vascular insufficiency ulcers, pressure sores, vasculogenic
ulcers, surgical and traumatic wounds. The product is also under investigation for use in second and third degree burns,
treatment of urinary incontinence in women and tympanoplasty surgery. The active ingredient in the material, derived
from Brazilian rubber trees or Hevea brasiliensis, has been identified to be a vascular endothelial growth factor, which
helps to promote angiogenesis. This molecule is also being tested for various indications including cosmetic applications.
The company was launched in 2003 and, since its inception, has already capitalized more than US$4 million from VC’s
and has been growing at a fast pace, while committing 35% of its annual budget for research and development.
39

PHB Industrial: Biocycle, biodegradable plastic from sugarcane
PHB Industrial, an association between two sugar mill groups in the state of São Paulo, has been using sugar cane to
manufacture biodegradable plastic (PHB or Biocycle), currently considered one of the best cases of bioplastic
manufacturing in the world. The Biocycle has similar properties to polypropylene and can be applied in plastic films,
bottles, metal plates, resistant packaging or even medicine capsules. Every 6.6 lbs of sugar produce approximately 2.2 lbs
of plastic.
The name Biocycle (cycle of life) alludes to the biodegradation process itself. The raw material appears from the
photosynthesis of sugarcane. Saccharose from the industrialization of sugarcane is transformed into a biopolymer,
polyhydroxybutyrate PHB, by means of fermentation. “All the other carbon sources are less competitive than sugarcane,”
explains the companies’ CEO, Mr. Ortega. According to his calculations, in the United States, for example, biodegradable
plastic derived from corn costs approximately 40% more when compared to Biocycle. When in contact with a biologically
active environment, that is, with bacteria and fungi, associated with temperature and humidity, the material goes back to
the stage of carbon dioxide and water, thus, closing the cycle. In an active environment, the packaging disappears in a
period from six months to one year and a half.
Most highlighted properties in this plastic are its production with renewable raw material, such as sugarcane, its complete
(non-polluting) biodegradability and its capacity to be produced by clean technology processes. The foreign market is, at
the moment, the main consumer of the product. PHB Industrial sells Biocycle to Europe, Japan, the United States,
Venezuela and Chile, among others.
Recepta Biopharma: Monoclonal Antibodies against cancer
Recepta Biopharma is a biotechnology company dedicated to the research and development of monoclonal antibodies to
be used in the treatment of cancer. The company's principal scientific partner, the Ludwig Institute for Cancer Research
(LICR), headquartered in New York, has licensed to Recepta Biopharma the intellectual property rights of four antibodies
with demonstrated potential for use in the treatment of several types of cancer. Recepta Biopharma is dedicated to also
generating new antibodies for clinical use.
Recepta’s first clinical trial will be a phase II study for ovarian tumor patients with mAb hu3S193 (anti-Lewis Y). The
protocol has been already approved by Brazilian IRB’s and also by ANVISA, Brazil’s regulatory agency. The protocol
has already been registered at the National Cancer Institute website and will be filed under the existing IND at the FDA.
Scylla Bioinformatics: cutting-edge software supporting genomics research
Scylla Bioinformatics is a Brazilian company created to produce high quality software for genomic data investigation.
The company started in May 2002, through the initiative of five bioinformaticians originated from the group that created
the innovative solutions that contributed to the reverberating success of the first Brazilian genome projects, including the
complete genomes of bacterial species Xylella fastidiosa and Xanthomonas citri, and sugarcane EST, allowing Brazil to
occupy a prominent position in the global genomic research arena. Scylla's team is composed by people with a solid
theoretical background and large experience in developing solutions for genomic and post-genomic investigations. Scylla
has received approximately US$300.000 from a Brazilian VC (Votorantim Ventures, Sao Paulo).
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Silvestre Labs: development & commercialization of advanced medicines
Silvestre Labs is a pharmaceutical company dedicated to the research and development of new and more advanced
medicines. The company launched its first product in 1991, a topical cream for the treatment of burns called Dermazine
®
.
Silvestre Labs reinvested revenues from the success of this first product into further research and a few years later
launched Dermacerium
®
, a formulation of cerium nitrate and silver sulfadiazine, which was found to prevent 50% of
deaths among severe burn victims. Dermacerium
®
can also be used for the treatment of other skin lesions such as leg
ulcers, diabetic foot and surgical ulcers.
The company’s innovative activities have also led to the commercialization of a number of other products at various
developmental stages. Dermacerium
®
and Extragraft
®
(a scaffold for bone regeneration) are currently being registered in
the United States, Malaysia, the United Arab Emirates, Korea, China and South Africa.
The firms’ research and interest in other areas, including stem cell research and recombinant protein synthesis, has lead to
the creation of two spin-off companies, namely Cryopraxis and Chron-Epigen, respectively (both in Rio de Janeiro).
SuperBAC: environment friendly technology
SuperBAC was founded in 1995, aimed at developing environment-friendly biological solutions to microbial control and
waste management.
In 2000, the Sterilizer division was created to provide a new technology, focused on microbiological control of indoor
areas. It is a process of disinfection of wide spectrum surfaces and high durability, which eliminates bacteria, fungi and
viruses. The treatment creates an active pellicle to protect the surfaces during a period of up to 06 months, depending on
the purpose of the area, and it eliminates and stops the proliferation of the noxious agents, making the space healthier.
In 2003, another division (Genesis) was created to develop, produce and market natural biological products applied in
waste management, including effluent treatments, grease traps and septic tanks.
5.2 Major Universities and Research Institutes in Biotech Research


UNICAMP: State University of Campinas
Unicamp is one of the top research universities in the country, offering a distinctive environment for the pursuit and
expansion of knowledge. During the last three years, Unicamp had signed more than 270 new contracts with partners on
services and productive areas. Unicamp has many patents, most of them in Chemical and Agribusiness. Many companies
were born with initiatives from former students, teachers and researchers.
The Innovation Agency of UNICAMP (INOVA), established in July 2003, has signed a record 9 license agreements
involving 22 patents in 6 months, a record for Brazil. By 2009, UNICAMP expects to be managing 100 license
agreements, which will place UNICAMP at the same level of some of the large and most successful universities in the
world.
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UFMG: Federal University of Minas Gerais
UFMG is the second largest Federal University of Brazil and has developed strong research capabilities and experience in
technology transfer in biotechnology-related areas. UFMG has 55% of its published patents in the Biotechnology area
and detains technology for diagnosis, vaccines and treatment of a wide range of diseases, from cancer and cardiovascular
to infectious neglected ones. Competent knowledge users from the pharmaceutical industrial sector are needed to sponsor
the pre-clinical and clinical studies of these products.
Currently, a Technology Park (BHTEC) is being built near UFMG campus, a partnership between the university, the state
government and private funds aiming at the creation of a modern technological infrastructure to promote local
development. It should attract increasingly clusters of high-tech industrial activity, especially in biotechnology and IT.

USP: University of São Paulo
The University of São Paulo is the largest higher e ducation and research institution in Brazil. It has outstanding projection
around the world and develops great part of Brazilian masters and doctors who work in higher education and research
institutes. Many of its students, after graduation, hold strategic and leading functions in different segments of public and
private industries. The EGI (European Graduate Institute) reported that USP is the 58th best university in the world,
according to the 2006 edition. The University is also considered the 45th most productive on the globe.
Cutting-edge biotechnological and biomedical research is carried out by several institutes inside the university, however,
special attention should be drawn to the Institute of Biomedical Sciences, the Institute of Chemistry and the Luiz de
Queiroz School of Agriculture.
EMBRAPA: Brazilian Agricultural Research Corporation
The Brazilian Agricultural Research Corporation's mission is to provide feasible solutions for the sustainable development
of Brazilian agribusiness through knowledge and technology generation and transfer.
Embrapa has generated more than nine thousand technologies for Brazilian agriculture, reduced production costs and
helped Brazil to increase the offer of food while, at the same time, conserving natural resources and the environment and
diminishing external dependence on technologies, basic products and genetic materials. The institute was responsible for
25% of the Brazilian international patents submitted in the year 2000. It currently holds 130 patents, 90 of which abroad.
The protected cultivars, a sui generis modality of patent, for instance, have generated an average of 2 thousand contracts a
year and resulted in royalties worth between R$ 11 million and R$ 13 million, one fifth of the budget for the company’s
costs between 1993 and 2002.
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TECPAR: Paraná Technology Institute
The Paraná Technology Institute (Tecpar) is a publi c company connected to the Office of Science, Technology and Higher
Education. It is a center of research, development, production and service rendering. Updated technological standards,
diversified lines of immunobiological and antigen products, advances in the field of biomolecular biology and biofuel,
enhanced and widely disseminated services in basic social and industrial technologies (metrology, tests and certification),
as well as consolidation of technological extension activities expanded to small and medium-sized companies in the state
of Paraná, enable the institute to meet the new req uirements and demands of several segments of society.

FIOCRUZ: The Oswaldo Cruz Foundation
Inaugurated on May 25, 1900, Fiocruz was given the mission of fighting the great problems of public health in Brazil.
Today the institution is responsible for a range of activities which include research development; highly-regarded hospital
and ambulatory care services; production of vaccines, drugs, reagents, and diagnostic kits; education and training of
human resources; information and communication in the area of health, science and technology; quality control of
products and services, and the implementation of social programs. Currently, FIOCRUZ has 111 patent applications and
52 granted patents, 38 of which abroad. Those patents encompass mainly medicines, vaccines and diagnostic methods.

BUTANTAN Institute
Butantan is a Brazilian biomedical research center affiliated to the São Paulo State Secretary of Heal th. It is
internationally renowned for its research on venomous animals. It maintains one of largest collections of serpents in the
world, comprising ca. 54,000 specimens, and it is also a state-supported producer of vaccines against many infectious
diseases, such as rabies, hepatitis, botulism, tetanus, diphtheria, pertussis and tuberculosis, as well as polyvalent and
monovalent antivenoms against the bites of snakes, lizards, bees, scorpions and spiders. The Institute is the largest
producer of immunobiologicals and biopharmaceuticals in Latin America (and one of the largest in the world).
Butantan also develops basic and applied biomedical research in many areas, including molecular biology, immunology
and epidemiology and has graduate research training programs in collaboration with other institutions in the areas of
biotechnology and infectology.
IAC: Agronomical Institute of Campinas
The Agronomical Institute of Campinas is a research and development institution affiliated to the São Paulo Agency of
Agribusiness Technology (Agência Paulista de Tecnologia dos Agronegócios ) with headquarters in the city of Campinas.
It is the oldest institution of its kind in Latin America, having been founded by Emperor Dom Pedro II in 1887 as the
Imperial Agronomical Station of Campinas. In 1892 it was transferred to the state government.
43

IAC's mission is to research, generate and transfer science and technology devoted to agriculture and related applied
fields, with the aim of optimizing plant production, sustainable socio-economic development and environmental quality.
The institute develops R&D projects in the following areas: agriculture, phytotechnology and plant improvement, soil and
weather, agricultural engineering and biological sciences. The Institute has also a number of sectors for producing goods
and offering services to agribusiness.
5.3 Support Institutions


ABRABI: Brazilian Association of Biotechnology Companies
ABRABI was established in 1986 and is the national entity that represents the Brazilian Biotechnology sector. It aims to
promote the development of Biotechnology in Brazil and to fight for the interests of its associated companies.
Internationally, ABRABI keeps contact with organizations such as FELAEB (Federación Latinoamericana de
Associaciones de Empresas de Biotecnología), BIO – Biotechnology Industry Organization, IFB (International Federation
of Biotechnology), EFB (European Federation of Biotechnology), the EUROPABIO and others to augment the exposure
of the Brazilian Bioindustry in the global market.
ABDI: Brazilian Agency for industrial and technological development
ABDI is an official agency with private and governmental participation, which has the mission to promote the Brazilian
industrial and technological development by increasing competitiveness and innovation. ABDI designs and promotes
policy, and works with government, civil society and the agents that implement public policy projects.

APEX: Brazilian Trade and Investment Promotion Agency
APEX is the Brazilian Trade and Investment Promotion Agency and has the goal of boosting Brazilian exports. The
Agency has 326 projects underway with Brazilian industry or trade associations representing 70 manufacturing and
services sectors. Through the sectoral projects, the agency promotes missions of foreign buyers, specialized journalists
and opinion makers to Brazil, organizes prospective commercial missions overseas, coordinates business rounds and the
participation of Brazilian companies in the main international fairs of the industry sectors. The agency also functions in
the investment attraction for developing the country’s export basis. Besides attracting Direct Foreign investments, the
agency promotes joint ventures and Brazilian investments abroad.

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BIOMINAS Foundation: promoting biobusinesses in Brazil

Founded in 1990, BIOMINAS Foundation is a private institution that fosters the development of biotech-related
businesses in Brazil while taking an active part in a relationship network both at home and abroad which facilitates the
identification of research projects with the potential to generate new businesses.
BIOMINAS identify new business opportunities and provide support to start-up and established biotech companies. It also
renders specialized services, elaborate sectoral studies and hold courses and events for the continuing education of
professionals, the dissemination of knowledge and the practice of networking.
An also meaningful contribution to the sector, its Incubator of Companies, was launched in 1997 and, in over 10 years,
has been responsible for introducing 21 start-up companies to the market, generating over R$ 70 mi worth in revenues. As
part of Biominas’ strategic repositioning, the incubator has been recently renamened as Habitat.
Since its inception, BIOMINAS has assisted 33 biotech companies being effectively involved in the development of the
biotech cluster in Belo Horizonte. All this knowledge and networking make Biominas the benchmark in terms of biotech
businesses helping to speedily develop the country’s biotech market.