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Archive December 2011

Labour lobs science and innovation agenda at National — watch out Steven Joyce! Peter Kerr Dec 22

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Among the (little) talk of Labour’s shadow cabinet line-up, one small fact’s escaped general notice.

New Opposition leader David Shearer has retained the Science & Innovation portfolio.

Excellent.

This is the first time since the 1930s that either the Prime Minister or the leader of the opposition has held this role. (George Forbes had it back then).

Firstly it indicates that Shearer wasn’t just seat warming when he had the shadow S&I portfolio pre-election.

Secondly, it indicates that, given he could’ve presumably taken any shadow-portfolio role he wanted, he sees S&I as being important, by definition the most important aspect, in the whole scheme of lifting New Zealand’s wealth.

With deputy Grant Robertson taking on the tertiary education, skills and training role, and David Cunliffe fronting up on economic development, Steven Joyce is going to find some welcome (from the country’s point of view) pressure to deliver on the super-portfolios he’s taken onboard.

In fact, having a strong income-creating, as opposed to money-spending shadow ministers at the top of his caucus, will be a powerful indicator to middle NZ that Labour’s looking for a new direction.

Shearer’s new mini-mantra, ‘clean, green, clever and innovative’ also has the welcome look of an agenda (we won’t use the word strategy) about it.

As National kicks off the New Year, it will have to be careful it isn’t outflanked in the Science & Innovation stakes.

Sure, IRL’s going to morph into a High-Tech HQ (or Advanced Technology Institute or whatever it will be called), with double the number of staff over the next few years.

But, it can’t be expected to, nor should it be lumbered with, having to defacto create a S&I strategy on behalf of the country. It is part of the solution, a big part, but part of a whole.

That whole should, as has happened in Denmark, Finland, Singapore and Switzerland, start with a Science & Innovation Council headed by a very senior minister (Key preferably, otherwise Joyce).

Such a council, in conjunction with wider industry, research and academia, is the best place, really the only place, from which to drive a collective sense of ‘this is what we’re trying to do/this is where we’re heading’ (note the lack of use of the word strategy — a bit of a no-no word in National parlance, so we’ll just call it an ‘action plan’).

The need for a collective sense of action and a wider ownership is also why the Ministry of Science and Innovation can’t come up with such an action plan.

And though ‘clean, green, clever and innovative’ isn’t anywhere near being a plan of action, it slips off the tongue quite well, and could serve Shearer well if Joyce doesn’t deliver.

So, David Shearer, a big ups for the surprise of keeping the S&I portfolio to yourself.

In reality, being much cleverer, using our biological resources better and figuring out the niche high-tech areas in which we can succeed is the only way for New Zealand to get itself out of (what is still, essentially) a commodity mindset.

In other words, the notion that agriculture et al are sunset industries is wrong. Everything’s complementary in today and tomorrow’s economy — let’s just do it all much better. Have a look at the latest Bioscience report to see how well we’re on some of these fronts.

As Shearer gets out, and talks to those he’d want to attract as voters, talking science, talking innovation, will be a way for Labour to differentiate itself from its past, and potentially differentiate itself from National — if National’s not too careful.

Unexpectedly, the ball’s suddenly back in your court now Mr Joyce.


Take a bow biosciences Peter Kerr Dec 20

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A wee while back sticK reported how high tech companies should skite more.

The same can be said for our biological industries (which are also of course high tech).

Because, better late than never, the 2010 Bioscience Industry Report comes with some pretty encouraging news for those making clever use of biology and brains. See the actual report here.

In spite of the global financial crisis (2008) occurring in the middle of the report’s reporting period; 2007-2009, the sector’s shown remarkable growth.

At the same time, the report has taken the opportunity to expand beyond a biotechnology definition – which comes with a bit of implied gene jockeying baggage, whether true or not.

Biosciences is an OECD term — and focuses on primary applications within the bioeconomy (includes animal, foods, and human health, plant and marine), health (includes biomedical science and drug discovery) and the environment (includes bioprocessing and biomanufacturing).

If, using the last report’s biotechnology definition, there had been an additional 45 new companies in the period, while under the biosciences moniker, there were a further 57 organisations.

In all, it reveals that there’s 267 bioscience organisations — growth at a time when worldwide there’s been much contraction.

As the report says, it is difficult to separate out bioscience income and activities from other biological exports, but then it delves into the sector’s entrails, reveals that between the previous report in 2007 and this one, net profit for dedicated bioscience organisations (an estimated 108) has more than tripled to over $121 million.

It also gives a few observations about the industry — one not surprising one being that venture capital in the $5-8 million region is hard to obtain.

But angel investment has been a standout.

The report takes the opportunity to give a swerve to rules around intellectual property, particularly the fact that unlike other investments, the whole of the price of a patent sale (for example) is taxed. The costs of acquiring the knowledge, or legal fees associated with obtaining the patent aren’t taken into account.

All in all, the report’s a nice little reminder that the backbone of New Zealand’s economy has a biological base — and biosciences is the addition of brains to this base.

Sure, we need to be much cleverer about what and how we derive value — be it specific active ingredients, energy (with LanzaTech as the poster child) or the health area.

But, if there’s one thing the report does indicate, it is certainly that a little bit of bragging is due.


Ahoy me hearties; an offshore way around America’s green card requirements? Peter Kerr Dec 15

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Partly because they were cheeky enough to ask, and partly because it is such a wild idea, here’s a plug for would-be entrepreneurial pirates.

Along similar lines to Radio Hauraki, way back in the 1960s beating the then broadcasting laws by positioning their ship outside the (then) three mile territorial limit, Blueseed is looking to do something similar for foreign entrepreneurs in Northern California.

That is, set up a platform (also known as a seastead) 12 miles offshore in international waters, with regular ferries to the mainland — which just happens to have Silicon Valley and its associated innovation ecosystem just down the road.

As Dan Dascalescu (Blueseed’s CIO who sent the ‘do a story on us’ email) says, the investor-seeking start up is looking to establish a 1000 person vessel and offshore incubator in the second half of 2013.

‘This way we’ll allow foreign startup entrepreneurs to live and work in close proximity to Silicon Valley, in a unique setting geared towards creativity and innovation, with a streamlined regulatory environment,’ he says. The operation would be visa-free.

At this stage, Blueseed intends to charge $1,200 per person per month for a shared room and bathroom, up to $3,000/month for a private cabin/bathroom. The company’s business model includes taking a 1%-9% negotiable equity stake in younger startups depending on how much equity they have on hand.

The venture’s an attempt to get around the often-restrictive USA immigration laws that make it very difficult for those non-Americans attempting to set up new, innovative businesses in the land of the good and the free.

The founders (Dascalescu, Max Marty and Dario Mutabdzija) readily admit that there’s a hell of a lot of logistical, political, operational and financial hurdles to overcome. However, the trio has raised a small amount of seed money, and is looking to raise another US$500,000 in the next few months, and then obtain another $10 million to $30 million to charter or purchase a suitable vessel.

Blueseed recently announced that PayPal founder, Xero investor and promoter of the Seasteading Institute (see here), Peter Thiel, has offered to lead the seed funding round.

They reckon the space they’d create would be interesting and enticing and innovative, attracting the best startups and their founders. It could even entice U.S. entrepreneurs currently living on dry land, such would be the positive environment that could be part of the whole operation.

Obviously the reality gap between talking the talk and walking the walk for the Blueseed venture is immense. But, you can’t accuse the founders of thinking small. New Zealand entrepreneurs have recently been provided with a Silicon Valley ‘landing pad’ via New Zealand’s Ministry of Science & Innovation (see sticK story here).

As evidenced by the artist’s conception of what a potential seastead could look like, landing pads of a helicopter kind would be part and parcel of the Blueseed bid. At this stage, it would certainly be one way round the American visa problem.

As you can imagine, the ad(venture) has gathered media interest. CNET News gives it version of Blueseed here, TechCrunch gives its rundown here, and Slashdot here.

Dascalescu also recommended Blueseed’s FAQ page as answering some of the host of questions asked for what is, if nothing else, a potentially clever way around the USA’s green card issues.


Stalking horse comments on innovative Auckland — Gluckman Peter Kerr Dec 13

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There’s a certain amount of stalking horse-ishness to Sir Peter Gluckman’s recent ‘Auckland conversation’ (formerly known as Mayoral Conversations; speakers of repute).

As the chief science advisor, Gluckman’s past kite-flying thoughts on research and other matters have generally preceded government action.

This speech (see here) will be no different, and as has been much of his direction lately, Gluckman’s concentrating on making money from our brains in ‘Innovation through science: the pathway to economic prosperity’.

He’s pushing Auckland, as the country’s only centre with the scope and aspiration to be a truly international city, as doing more, much more, to lead the development of a true innovation ecosystem.

Briefly doing justice to his talk, Gluckman’s strong on the notion that while we have the capability, we’ve got to massively increase our combined effort to make more money in the high-tech areas that have protected and allowed countries such as Denmark and Switzerland to flourish. (He includes advanced foods for health in this category too).

It won’t be easy — again he gives the examples of Israel where the evaluation of at least 100 ideas thought to be of value only sees one that justifies investment.

‘Yet, the Israelis have no more researchers than we do, just a better linked up system,’ Gluckman says.

Unlike Israel or Singapore or some of the Nordic countries with which New Zealand compares its itself, we’ve never had a sense of crisis and urgency, and together with our inbred egalitarianism have undervalued the role of intellectual activity and science he reckons.

Our country also has the habit of believing in single interventions rather than integrated system wide approaches, when the ‘key to all of what I’ve been saying is the need to have a multi-layered innovation ecosystem,’ he says.

This has many components, with local government promoting, encouraging and if necessary part-financing an ‘innovation city’. It needs the development of technology parks (he gives the Wynyard quarter project a big boost later in his talk), clustering academia and entrepreneurs along with support services.

It also needs the institutions — hospitals, universities, technical institutes — to cooperate rather than compete. (He makes another aside point on whether universities are producing what a high technology economy needs. ‘Unfortunately a number of incentives in play in the tertiary sector can be counter-productive and drive an over-emphasis on individualistic institutional behaviour.”)

Gluckman’s better than many people at not just stating the problems, and fires up a few ideas that would drive more innovation — again, drawing heavily on Israel’s example.

Many Israeli innovation incubators are owned jointly between investors and the local authority, or between the local authority and the university, and work with large sums of both government and private money.

‘The Israeli model is based on a high ideas flow, an aggressive culling, high levels of investment and international management and technology input from the start,’ Gluckman says.

Importantly (in sticK’s opinion) ‘new ventures are supported with loans, not grants, to encourage entrepreneurial activity — written off if the product does not make it.”

Auckland, he argues, is uniquely placed to create an environment for this type of innovation (again mentioning the Wynyard quarter).

Gluckman gives other examples of what success could look like (another post).

As he says though, ‘at the end of the day this is about environmental and cultural change — it starts at the bottom and it starts at the top.’

And while Auckland has been giving a lot of its infrastructural attention to transport, ‘to make this truly a global city we also need to think about the knowledge infrastructure in the sciences and technologies.

The investment needed is partly fiscal, but so much more of it is psychological and motivational. Let us do the things that enable Auckland to brand itself as a city of innovation, a smart city in a smart nation.’


Testing business helps prove products’ promises Peter Kerr Dec 06

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One way to test the properties of a biological product, such as a honey or native plant extract, is to feed it to an animal or human and measure (hopefully) the results.

This takes a fair bit of time, and quite possibly money.

Another way to do it is using models of biological effects, something that acts as an indicator of a product’s efficacy. This can cut the time down to weeks, and causes a much smaller hole in the wallet.

Which is exactly what Wellington company Trinity Bioactives carries out for its mostly Australasian, but also global clients. It uses scientifically proven and established methods to indicate on the label, as a proxy, that a product has been shown to have biologically active ingredients.

Trinity’s Managing Director and Director of Research and Operations Paul Davis, a biomedical researcher by training, is a large part of the brains behind the 160-170 tests, or assays, that the Gracefield-based seven person team is able to apply for (would-be) makers of nutraceuticals, functional foods and products sold over the counter at the likes of chemists, supermarkets and health food stores.

Trinity’s genesis came about in 1994 when the Biological Investigation Group (BIG) was set up as a research and business unit under the auspices of the Otago University’s Wellington Medical School. It was triggered by Davis going into a Johnsonville Mall health food shop and observing nine different brands of shark cartilage being on sale.

‘I wrote down what the product said it was and its price,’ he says. ‘Then I went home and calculated the price on a cost per kilogram basis. The price varied from $450 a kilo to $3,300 a kilo. The labels all listed what was in the cartilage, the fat, protein, mineral and so on, but nothing told me about the effectiveness of the product. Was the $3,300 product eight times more effective than the $450 one? There was no way of knowing. They could’ve all been dead for that matter, and had no active ingredient.’

This failing from a biological effectiveness point of view helped bring BIG into existence, along with valuable assistance from George Slim and Richard Furneaux; from Industrial Research Ltd.

Over the next 14 years, Davis and BIG developed different assays to measure a diverse range of biological potencies and efficacies. Many of these assays are cell cultures — perhaps of stomach cells or cancer. There are other tests that measure the diabetic response. Others measure a skin response. There are also many, many other tests.

One common feature of all the assays is the method has been proven and written up in reputable international scientific and medical journals. Somebody, somewhere, has demonstrated that using a particular method demonstrates a particular measurable, response.

Trinity uses these publicly-available methods, to prove the activity or otherwise of the biological products it is asked to investigate. These range from emu oils to green lipped mussel extracts, bee propolis to dairy extracts. .

The University sold BIG, which was renamed Trinity Bioactives, to Davis and a group of investors in 2008, and though the laboratory moved from its Wellington site to Gracefield in 2010, Trinity continues to use the Medical School’s animal testing facility at times.

‘It doesn’t matter to us what sort of test material you want to look at,’ says Davis. ‘For example, if the client wishes to investigate the effect on inflammation, there’s so many different types. But we can test the multiple cell types and biochemical pathways that couod eb involved. What we do, is discuss with the client what they want to investigate, and then design a study to address those questions.’

The results, obviously mostly when the product demonstrates a favourable outcome for say its appropriate properties, are able to be published often as part of the fine print often seen on the back of a package.

Manufacturers can’t publish something without our approval.’ Davis says. ‘In fact, neither party can publish without the other’s prior approval. This to protect them and us’

This provides an evidence-based approach, that an independent agency has provided a report. All these assays and models are in the public domain and literature, ‘so the methodology is recognised,’ he says. ‘When we discuss the investigation of a product with a client, we can also give a copy of the methodology in the paper that has been publicly published.’

No other Australasian company provides such a comprehensive service, and ‘it provides, for companies looking for a market advantage, evidence that a product does have an effect.’

Along the way, Trinity has also established some important collaborations. It doesn’t conduct many trials of pharmaceutical products, ‘We simply wouldn’t have enough inquiries,’ Davis says. The safety/toxicity aspects using experimental animals would cost at least three to four times our current rates

For that sort of work, Trininty refers the project onto a Melbourne partner, who in turn directs natural product, nutraceutical and functional food tests its way. ‘At the moment, Australian inquiry has been quite active, and we’ve obtained a fair bit of work from our partners across the Tasman.’

Over the years, Davis has had to apply an increasing quantum of knowledge on methods, procedures and applications for testing biological activity. In being aware of different methods, and new ones that are being published all the time, it means that often Davis is a problem solver needing to work out a particular way that different biological effects can be demonstrated.

‘We often need to develop a test that’s relevant for the product that a client is producing,’ he says.

An increasing amount of business, and one that is good from a steady income point of view, is testing on a batch basis, levels of biological efficacy in natural products . This means a bioactivity certification or indicator of quality can be provided with every delivery that a manufacturer may make to its own client which in turn is making up a formulated product. .

In all cases, it involves sitting down with a client, and negotiating what Trinity is going to do to try to address the question that the client wants answered..

‘We get an agreement before we start, and we both know what is going to happen through the production of a Study Plan,’ says Davis. ‘From that we can produce a formal report on a personalised basis at the completion of the study.’

In designing a study, Trinity is able to supply an estimate of what it will cost to measure biological activity, along with toxicity and safety measures.

‘Davis says. ‘Often we’re doing blind tests, we don’t even know what we’re screening. This helps to remove the chances of bias in determining the results. .’

Davis says there are big opportunities for New Zealand companies to sell biological products, where the level of activity is provided as part of the whole package. This will establish that the products are biologically active.

The combining of different products, which often will show a synergistic effect is another opportunity, for which Trinity is able to provide methods that show the beneficial enhanced activity.

One of these was a green lipped mussel extract, for which a company tried different combinations of additives/combinations. As a result, one showed increased effectiveness, and this is now being marketed and sold as a superior product

‘There are untold possibilities out there for New Zealand,’ he says, with a number of sources of government funding being available to ease the cost of testing biological effectiveness.

‘And the great thing is, when I come in in the morning, I don’t know who is going to knock on the door,’ Davis says.

‘And our job’s about solving problems. There’s a real intellectual buzz to being able to do that.’

Davis says there’s also a range of opportunities for innovative and brave New Zealand companies looking to add value to the country’s biological resource.

Being in a position of an ‘honest broker’ he receives inquiries from both the market/consumer end, and the producer.

‘If we open our eyes and ears, there are many people who are after the high quality products that this country can offer,’ he says.

‘As long as proof is provided that something does what it says it does, then the rest of the product’s story can largely write itself.’


Prime Minister as prime innovator — get going on #13 Peter Kerr Dec 01

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We probably shouldn’t be surprised that amongst all the next to ‘do’s’ from the incoming National-led government, the one with the greatest potential to be a game changer, has been ignored by most of the media.

Issues of teapots are much more pressing!

However, the under-the-radar announcement early in the election campaign of the doubling in size of IRL to become a high-tech HQ is exactly the type of initiative needed to support an economic revival in New Zealand.

The same day (Nov. 3) release of a ‘Powering Innovation’ report also had a number of recommendations.

Number 13 could be the most important in the scheme of setting an agenda, theme, direction or strategy (in the absence of one as noted by businesspeople in a survey before the election).

#13 – Form a Science and Innovation Council, led from a very senior ministerial level in Government, with representatives from the university, public and private research
organisations and from industry. Members should represent a wide range of science and technology themes, including the social sciences. The role of the Science and Innovation Council should be to establish a national innovation strategy and advise on science and innovation policy and priorities.

In Denmark, Singapore, Finland (all smaller countries with which New Zealand so often, so unflatteringly compares itself) that ‘very senior ministerial level’ is the Prime Minister.

And so it needs to be in New Zealand. Key is key to cranking up the money-making creativity, and for the nation to give itself permission and capital and build the skills to grow the value of what we produce.

This was noted in the New Zealand Institute’s press release that ‘The Prime Minister should be the prime innovator’ (see here). ‘An Innovation Council chaired by the Prime Minister would ensure that any policy, business and education impediments would be addressed alongside the inventiveness improvements already commenced.’

Put another way, having Key as the prime innovator means all the ducks are flying in formation — helping to ensure that impediments are removed, tracks are greased.

Of course Key would need to have a pretty good second in command to help achieve all this.

A rumour floating around Wellington is that Stephen Joyce may look to have a super-portfolio that has the Ministry of Science & Innovation, the Ministry of Economic Development and the Tertiary Education Commission all coming under his bailiwick.

Part of the thinking is that though all three ministries produce excellent policy, it is often produced in a silo. At the macro level, the policy can be perverse, even contradictory.

So, Key to pick up #13 of Powering Innovation as prime innovator, and Joyce to pull it all together?

sticK calls it first.


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