Country Focus
Biotechnology in the Baltic States
The three Baltic States of Estonia, Latvia, Lithuania are seen by most as economic tigers: Their growth rates are large and their bureaucracies small, all of which aimed at attracting foreign investors. In the sphere of biotechnology, the picture is decidedly less rosy. Lithuania has the advantage of being a scientifically orientated capital city with historical and established research institutes, but the city is home to only three, albeit successful, private biotech companies. Latvia, on the other hand, is home to a much larger scene, which is now seeing the creation of a number of pharmaceutical production facilities as well as moving towards some form of consolidation as a national association. Estonia, with a handful of different companies, is looking much the same - tightly coupled with state research institutes and concentrating above all on molecular-biological services. The overall picture shows that the Baltic States are at the earlier stages of development. The future path depends above all on money - hardly a trivial matter for any country, whether in public or private initiatives. All three of the Baltic States see their best hopes in trans-national networks, both in the Baltic see region and in Europe.
Introduction
The Baltic is stamped with the clear impressions of fresh political change: first, independence from the Soviet Union in 1991 then, in 2004, entry into the European Union. Economically, all growth rates are in the region of between 6 and 7 per cent. These political upheavals are also reflected in the three countries’ youthful biotech scenes. The majority of the larger companies operating today are offshoots of former national research institutes and the ties between research and economics remain close to this day. This can be seen above all in Lithuania, whose few companies almost all developed from a single public institute. What is more, Latvia can profit from the pharma production plants established by the Soviets in earlier times - a tradition that can now be nurtured and expanded.
From a political perspective, the life sciences in all three countries receive the best possible support: Alongside IT, biotechnology in Latvia, Lithuania and Estonia is a field of the future. There are a great number of funding initiatives being pushed forward, particularly in the field of medicine. Agriculture is only significant in Lithuania, otherwise genome research, enzyme technology and diagnostics development are the dominant fields. It would surprise few to hear that controversial projects such as genome databases (Latvia and Estonia) are exclusively and amply supported by the state. However, none of the countries are having a financially easy time - the percentage of GDP of the research budget is only between 0,4 and 0.7 percent, and private money is equally limited. For this reason, most Biotech entrepreneurs have been pushed to create the necessary service models extremely early, whereas the former close involvement of the state and economic sector has meant that many scientists lack economic competence.
Above all, the Baltic States are hoping for closer ties with Northern Europe through the Baltic Sea network ScanBalt. In particular, investors from Sweden and Finland, who can be locked in with lower rent and personnel costs, are being closely courted. To date, however, these expectations remain largely unfulfilled.