Australian Biotechnology Sector Fact Sheet 

Key Points

• The sector comprises a range of companies, from start-ups to more developed companies selling products in Australia and overseas, and applying biotechnology to health, industrial processing, agriculture and environmental issues.
• The biotech sector has matured significantly in recent years. At 30 September 2009, the end of the first quarter (Q3), 66 ASX-listed biotech companies were included in the Biotech Business Indicators (BBI) with a combined market capitalisation of $23.9 billion (bn), compared to $9.9 bn at the end of Q4 2004, when the Department complied the first edition of The BBI. See Table 1.
• CSL is Australia's largest biotechnology company, with a market cap of $20.0 bn at the end of Q3 2009.
• The market cap of the ASX-listed biotechnology companies included in the BBI, excluding CSL, at the end of Q3 2009 was $3.9 bn, compared to $4.1 bn at the end of Q4 2004. The combined market cap for biotechs excluding CSL fell dramatically over 2008 to a low of $2.1 bn at the end of Q4 2008, but increased during 2009. In Q3 2009, 60.6 per cent of BBI firms increased their market cap over Q3 2008. As a result, at the end of Q3 2009, the market cap of the listed biotech companies (excluding CSL) was 34.4 per cent above the figure at the end of Q3 2008.
• At the end of Q3 2009, there were some 11 companies included in the BBI which had a market cap in excess of $100 million (m). CSL is excluded from this analysis. These 11 companies had a combined market cap of over $2.7 bn. The number of such companies is a proxy indicator for the maturity of the biotech sector. At the end of Q4 2007 some 15 companies were valued in excess of $100 m by the market [combined market cap $3.4 bn]. At the end of Q4 2008 this number had fallen to five [combined market cap $0.8 bn], reflecting the impact of the global financial crisis (GFC). A list of these 11 companies (plus CSL) is included in Facts and Figures on page 2.
• During Q3 2009, notable secondary capital raisings reported in the BBI amounted to approximately $65.4 m. The first months of 2009 saw an increase in cost cutting measures by a large number of firms in efforts to conserve cash flow. In Q3 2009, one company was delisted from the ASX and the BBI following its acquisition, one company delisted and one company left the biotech sector for the capital goods sector.
• The sector includes a large number of research intensive SMEs, including many spin-outs from universities and other publicly funded research organisations. An overview of the sector is provided in Table 2.
• The maturation of the sector since 2004 illustrates the ongoing benefits of a strong research base, further underlined by the increasing number of companies with products in the later stages of clinical trials. Income generation from sales will allow these companies to mature their business structures and rely less on raising capital from external sources.
• The sector's major exports continue to be IP, through licensing deals with large international pharmaceutical and biotechnology companies.
• The May 2009 Budget announcements held significant benefits for the biotech sector.

Facts and Figures

Available Key Indicators/Statistics

Using data available from the ASX, DIISR produces BBI, a quarterly publication that summarises key statistics on the Australian biotech companies listed on the ASX.

Table 1: Biotechnology Sector – Key Market Statistics

Table 2: Biotechnology Sector – Employment and Financial Data

Companies with a market capitalisation in excess of $100 million, at 30 September 2009:

1. DIISR – As per the Biotech Business Indicators, data is drawn from the Australian Securities Exchange website: www.asx.com.au
2. DIISR analysis of data from Trading Room website: www.tradingroom.com.au
3. Ernst and Young, Beyond Borders: The Global Biotechnology Reports, 2006. 2007, 2008, & 2009
4. Lyndal Thorburn & Kelvin Hopper, BioIndustry Review Australia and New Zealand, 2005, 2007 & 2008