Norwegian biotechnology has been thrown a lifeline after the country’s government made explicit provision for life sciences and innovation research within the NOK20bn ($2.87bn) stimulus package unveiled on Monday.
The biotechnology component of the stimulus, valued at just under £300m (€318m, $418m) will prevent half of the company’s biotechnology groups from going bankrupt.
“This is the most active political move in Europe regarding support to the biotech industry,” said Bjarte Reve, chief executive of the Oslo Cancer Cluster, which represents 25 Norwegian biotech groups that employ about 1,000 people.
“At this point, these seem to be the necessary measures to bring the Norwegian biotech companies through the financial crisis.”
As part of the package, Innovation Norway, a state development agency, will increase the amount of loans it makes to research-intensive companies – principally biotech and information technology groups – from £32m to £95m a year.
Argentum, the Norwegian government fund which invests in private equity groups and has €500m (£473m, $658m) under management, will also get £200m ($279m, €212m) to invest in innovation-focused companies, also explicitly focused on biotech and IT.
More than 80 per cent of Norway’s biotechnology industry is focused on cancer research and are based in and around Oslo. Mr Reve said that if support for the biotech industry had not been forthcoming, many of those companies would have gone bust, threatening the loss of 50 cancer products currently in clinical trials.
“Last December, half of our biotech companies said in a survey that they would run out of cash in the next 12-18 months if nothing happens, so this has been crucial in stopping half of our companies from going under,” said Mr Reve.