Biotech in Berlin

Another region benefiting from foresight exercised in years past is the Berlin-Brandenburg area in Germany, which today has the most biotech companies of any nation in Europe. The Berlin area alone is home to about 150 biotech players. In 1996, the federal government recognized the beginnings of a biotech boom and was determined to help the industry grow in Germany. The government put in place a regional competition involving 16 regions throughout the country. The regions had to demonstrate their ability to foster biotech research and development and to encourage commercialization. Funding was available to support regional initiatives, including the establishment of research and technology parks and other infrastructure-related projects. The exercise was successful in Berlin-Brandenburg insofar as the number of biotech companies grew from about 30 to the cu rrent 150.
        "We are aiming to have in place between 200 and 220 companies within the next three to five years," says Christian Weiss, who oversees business development in the life sciences sector for the Berlin Business Development Corp. "What is characteristic of the biotech scene in Berlin is that the link between research and development – the universities and institutes – and the companies is still very, very tight. A lot of these companies are spin-offs out of these institutions and are set on fertile ground, because the infrastructure – like biotech parks – locations, research grants all are right in Berlin."
        Seven biotech parks, three major universities with biotech programs and 38 research institutes focused on biotechnology are among the local resources available to biotech and other life science companies. According to BioTOP, an agency dedicated to supporting biotech companies, dozens of companies and institutes in the area are seeking collaboration arrangements in the industry. Seven venture capital firms are based in Berlin, and commercial space is available at rates well below those in other European capitals.
        All of which begs the question: Is the Berlin area emerging as a biotech cluster, or is it already an established life sciences center? Despite the numbers, the former is actually the case.

Dr. Rahmat Abdi Baghi

        "At this time, it is not a real biotechnology industry, because most companies do not earn money on their own," says Dr. Rahmat Abdi Baghi, CEO of Phytobacter Production AG, a developer of microbiological products for use in agriculture, forestry and other industries. "Very often, they get money from other companies and from the government, but they have to establish themselves in the market. The future will show whether all these companies will exist over the next five years."
        In the meantime, he adds, Berlin is an ideal location in which to grow Phytobacter. "The universities are a very good source of young scientists and know-how. In some projects we have joint ventures with the universities, and we all benefit in terms of knowledge, contacts and experience."

Alexandra Sowada

        Another catalyst for Berlin's emergence as a center of business and industry is the recent relocation of the national capital from Bonn to Berlin. "A lot of companies are moving their headquarters to Berlin, including pharmaceutical companies, so the capital is growing, and that is advantageous for us," says Alexandra Sowada, chief financial officer of Jerini AG, a biopharmaceutical company specializing in the discovery and development of peptide-derived drugs. Jerini AG began operations in one of the city's seven research parks and then moved into commercial space in central Berlin, where it employs 85 people.
        Biotechnology site seekers have still another reason to keep Berlin on their list of finalist locations – incentives. "In eastern Germany, there are a lot of special subsidies and opportunities for government grants," says Sowada. "Germany always had [incentives], but for the eastern part, they are higher in order to help industry grow.
        "A large part of Berlin is considered part of the eastern region," she continues, "and for that reason, many startups and many growing companies come here to take advantage of that. They benefit both in the research grants and when investing in assets." This makes the Berlin area very competitive in relation to other German locations, Sowada relates, and internationally as well.