Qld's biotech bid grows by another $100m

The Queensland government has gone one-up on the State and Federal governments by announcing a new $100 million Queensland BioCapital Fund.

The new venture capital fund, launched by Premier Peter Beattie and Treasurer Terry Mackenroth, is the largest dedicated biotechnology fund initiative by a government in Australia.

"QIC designed this fund on the model of successful US biotechnology venture capital funds, with the aim of producing high returns to its government clients by investing in an area which is under-serviced in Australia," Beattie said.

He explained that the fund would have a 10-year lifespan, with investment in approximately 20 projects over the first four years. The focus would be on projects in the human biosciences sector.

The fund is planned to exit its investments by trade sales and share market listing by 2012.

It will be managed by the Queensland Investment Corporation (QIC), which is the fund management arm of the Queensland government.

QIC was responsible for proposing the initiative to the Queensland government, Beattie said.

According to Beattie, the new fund would not restrict itself to investments in Queensland ventures, but he expected that most would originate there due to the location of the fund and the quality of research in Queensland.

However, the fund would be restricted to Australian biotechnology projects.

He said that the fund would help Queensland develop its young biotechnology industry as well as provide high returns for QIC's investors.

"Venture capital is not just pouring money over science and hoping it grows. For a scientific project to achieve commercial success, you need to add management skills like product development, manufacturing and marketing," he said.

Beattie said that he hoped that some of the fund's investments would expand into the rest of the world, because biotech was a global industry and the US the biggest market in the world.