For Canadian companies looking to crack the greater European market, the Netherlands isn’t necessarily the first locale that comes to mind. But the Dutch life sciences community is working hard to change that, and with good reason.
Significant investments from government, industry and academia over the last several years have turned the Netherlands into a hotbed of life sciences innovation, with emphasis on biomed and healthcare applications. Public–private partnerships (PPP), in particular, have become the cornerstone of the Dutch research infrastructure. It’s also the base upon which the country is increasingly attracting foreign investment and welcoming collaborators from around the world.
Indeed, the Netherlands’ growing life sciences industry boasts world-class research institutes and science parks, universities, multinational companies and start-up organizations. The Dutch workforce is multilingual (nine out of 10 adults in the Netherlands speak English) and extremely well educated. The country has a strong business/financial infrastructure (low corporate tax rates, for instance), as well as a sophisticated logistics and transportation infrastructure. And there are obvious advantages to its centralized geographical position, neighbouring the UK, Germany and France. The Netherlands just might be the ideal gateway to Europe.
Location, location, location
Bordering the North Sea, between Belgium and Germany, the Netherlands sits at the hub of Europe’s transportation system: it touts easy access to the Amsterdam airport but also to the major airports in nearby Liege and Frankfurt. Dutch ports are among Europe’s shipping leaders.
The country’s small size (700 miles x 200 miles) has encouraged the Dutch to make their economy very open and outwardlooking. More than two-thirds of the Netherlands’ foreign trade is with EU members, with Germany alone accounting for a quarter of total Dutch trade volume.
And the Dutch government plans to increase the Netherlands’ profile as an appealing country in which to do business. Among other events, Dutch officials recently opened the Holland Gateway business centre at the World Trade Center at Schiphol Airport to offer information on doing business in the Netherlands (business climate, labour market, regulations); assistance in dealing with administrative processes (residence permit applications, company registration); and referrals to the Dutch network of public and private stakeholders.
The Netherlands Foreign Investment Agency (NFIA) facilitates direct investments of foreign companies in the Netherlands through a network of worldwide offices. E arlier this year, despite the global economic crisis that began last year, the NFIA posted record results in 2008 for the second straight year in all three measured categories: the number of projects, job creation and capital investment. Overall, the NFIA supported 182 investment projects of foreign companies that located various operations in the Netherlands—a remarkable increase of 27 projects over the previous record-setting year.
In August of this year, the U.S. Bureau of Economic Analysis announced that the Netherlands passed the UK to become the leading recipient of U.S. foreign investment in 2008, receiving $442.9 billion in U.S. direct foreign investment (14 per cent of the total). The UK received $420.9 billion (13 per cent), while Canada received $227.3 billion (7 per cent). As in previous years, these three countries account for more than a third of total U.S. foreign investments. For Canadian stakeholders, the Netherlands is an important export market in its own right—it’s Canada’s seventh largest.
Dutch life sciences at a glance
Dutch companies are leaders in plant and farm animal breeding. In biomedical sciences, the Dutch excel in areas such as cancer research, infectious diseases, vaccines, molecular imaging, cardiovascular and clinical research.
There are five main regions for life sciences in the Netherlands, says Roger Kleinenberg, Co-ordinator of Innovation, NFIA: Amsterdam, Hague, Leiden, Eindhoven and Maastricht. The latter sits at the heart of the Meuse Rhine Triangle, an area covering Germany, the Netherlands, and Belgium.
In addition to being home to countless successful small—and medium-sized, as well as large multinational companies such as Centocor, Genzyme, Medtronic, Bio-Imaging Technologies and Agendia, the Leiden and Eindhoven regions also host the country’s two large science parks, Leiden’s Bio Science Park and High Tech Campus Eindhoven.
The High Tech Campus at Eindhoven was started by Philips Research (then Royal Philips Electronics, and now one of the world’s largest private research organizations) with the goal of becoming “a hotspot for high-tech human-focused innovation,” says Cees Admiral, Business Development Director at the campus. Today, it houses 51 companies including Philips, Sun, Accenture, and IBM, along with independent research organizations Center for Translational Molecular Medicine (CTMM) and BioMedical Materials program (BMM). Heidi Hamers, CTMM Managing Director, says the campus is an “inspiring environment. There are large companies like IBM working with the smallest startups... all sharing resources. That’s what attracts companies and researchers here.”
It’s all about ensuring collaboration among companies—large and small— and encouraging open innovation, adds Admiral. “Here, R&D has evolved from pure research to product research to open research, which emphasizes entrepreneurship and investment funding and open learning.”
The ultimate goal is to double the size of its life sciences sector over the next 10 years.
Leiden Bio Science Park features roughly 60 medical life sciences companies, the greatest number of Dutch bioscience startups, eight institutes, and Leiden University Medical Center. It was one of 22 parks worldwide to be honoured by the International Association of Science Parks, and was also recently named Best Business Park in the Netherlands. Leiden is also home to several key institutes and companies such as TI Pharma, LifeLines (a public biobank), and The Netherlands Organization for Applied Research (TNO), a research organization focusing on telecom, defense, pharmaceuticals and life sciences, among other things. Leiden Bio Science Park residents also include: Pharming, Crucell, Galapagos and OctoPlus.
Nettie Buitelaar, CEO of the Leiden Bio Science Park Foundation, says thanks to €130 million in new investments, they have ambitious expansion plans that include a teaching biopharma production facility to give students on-the-job skills (and ultimately relieve the shortage of technical (applied science) candidates that are available to employers).
In 2008, the Leiden Bio Science Park also welcomed the arrival of Montreal-based CryoCath Technologies’ European headquarters. CryoCath is a public medical technology company working on catheter-based products for the cryotherapeutic treatment of cardiovascular disease. Established in 1994, the company went public in 2000 with one of the largest-ever Canadian IPOs in biotechnology.
Key players
Strong collaboration and involvement—and financial co-operation—from government, industry and academia make up the Dutch model for integrated life sciences innovation, with several public–private partnerships (PPPs) at its core. The government of the Netherlands is investing about €500 million in public-private life sciences partnerships in just the health domain. That public investment has been doubled to a total of €1 billion by industry, universities and university medical centres.
The new partnerships will draw from a wealth of basic research already generated in previous-years’ public-private partnerships. The Netherlands Genomics Initiative (NGI), for example, is a 10-year, €1-billion program that entails basic genomics, proteomics and metabolomics research for agricultural, industrial and medical applications (founded in 2002, NGI makes up the exploratory research arm of the Dutch life sciences cluster). Others, such as Top Institute (TI) Pharma, the Center for Translational Molecular Medicine (CTMM) and BioMedical Materials (BMM) Program, focus on health and cover drugs, diagnosis, and devices respectively.
Willem de Laat is Managing Director of TI Pharma, Leiden. He says the big three PPPs—created and commissioned for five years—draw funding from Dutch universities, the Dutch government and its various foundations and arms-length organizations, as well as private (pharmaceutical) companies. Projects within each program depend on an internationally peer-reviewed call for proposals.
“This is a relatively new concept in the Netherlands. Typically, academia and companies operated on their own. So the government began to set up partnerships,” he says. “We fill a gap between basic research and development projects. Our most important goal has been achieved: promoting local and global collaborations and consortiums.”
TI Pharma facilitates public–private research and development into priority medicines, as identified by the World Health Organization. The list of companies on its partner list includes GlaxoSmithKline, Lilly, Amgen, AstraZeneca, and Galapagos. In total, TI Pharma currently facilitates 42 projects.
CTMM, based at the High Tech Campus in Eindhoven, is focused on the development of medical technologies that enable the design of new and personalized treatments for the main causes of mortality and diminished quality of life (cancer and cardiovascular diseases and, to a lesser extent, neurodegenerative and infectious/autoimmune diseases). Its partners include Philips, Organon, DSM, AstraZeneca and several smaller biotech companies. CTMM allows non-Dutch companies with no presence in the Netherlands to participate in its projects.
For its part, BMM is focused on drug delivery, organ replacement, and passive and active scaffolds in four disease areas: cardiovascular, musculoskeletal, oncology, and nephrology. Its partners include Philips, FujiFilm, Medtronic, and academia.
Future growth
Government and industry also recently created the Life Sciences & Gezondheid (or Health) (LSG) program to help small and medium-sized companies—which account for most of the 935 companies in the Dutch life-sciences sector—find funding and opportunities to take their products to the next stage. The ultimate goal is to enable the Netherlands to double the size of its life sciences sector over the next 10 years. (Life sciences currently employs 55,000 and brings in €16 billion ($25 billion), accounting for three per cent of the country’s gross domestic product.) As part of the overall plan, a VC fund is being set up to support small and medium enterprises. The hope is to increase revenue in life sciences and health, with growth of €15 billion by 2015.
“The goal is also to stimulate entrepreneurship, particularly in academia,” says TI Pharma’s Willem de Laat. “We’re facing some deficiencies in the Netherlands—we have a great research infrastructure and evolved PPPs, but we need to get knowledge translated into products and economic opportunities. We think [this program] will fill in a deficit in the value chain.”
In the Netherlands, the private sector is providing less of the development funds for life-sciences innovations than in other European countries, according to Hans van den Berg, Executive R&D Co-ordination Director at Organon, Schering-Plough’s Dutch-based subsidiary, and head of the task force behind the LSG program.
“We are facing an imbalance between the public and private sectors in the Netherlands. That is why we need to build up the strength of the private sector in R&D. Public-private partnerships are one way of doing this.”
Key Resources
Life sciences in the Netherlands: www.lifesciences.nl
Netherlands Foreign Investment Agency: www.nfia.com
Netherlands Board of Tourism: www2.holland.com/us/index.jsp
The Canadian Trade Commissioner Service: www.tradecommissioner.gc.ca and www.canada.nl
