“Goldgrube 12” is the address of BioNTech in Mainz. This once small company is now regarded as a beacon of the German biotech industry. The company, co-founded by oncologist Ugur Sahin, develops individualized cancer drugs. Through rounds of financing, cooperation with pharmaceutical companies and a listing on the U.S. technology exchange Nasdaq in October, BioNTech raised over $1.4 billion. The prospects for the German biotech sector as a whole, however, are assessed less positively by experts.
“We don’t want to develop individual drugs, but we have a completely new approach,” said Sahin, who was awarded the German Cancer Prize in 2019. “Our goal is to develop individualized therapies tailored to the cancer of each individual patient.”
Until now, it has been common practice to limit the tumor diagnosis of a patient to individual characteristics and to derive therapeutic decisions from these. Individual characteristics of the disease would only be roughly recorded. BioNTech is focusing on “next-generation sequencing,” a technology that can record the analysis of billions of genetic features in the human genome and changes in cancer—a completely new method.
“You can compare that to Tesla,” said Sahin. The entire innovation chain, including the production of large quantities, has to be set up. “Only, at BioNTech the level of individualization is much higher. If this works, it will give us an enormous advantage over our competitors. Currently, BioNTech is treating patients with late-stage cancer, cases in which the disease is rarely curable. However, the trend is towards an earlier diagnosis of even the smallest metastases with blood tests.”
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Siegfried Bialojan, a biotech expert at the consulting company EY, considers BioNTech to be a “beacon” of the German biotech sector alongside Qiagen, Evotec, or Morphosys. But these lighthouses are not very representative of the segment as a whole. In terms of breadth, the industry falls far behind, although the potential in this country is “enormous” in view of the strong research landscape. “Against this background, little is happening,” criticized Bialojan. Despite billions in research funding, little added value has resulted.
Germany lacks a financing ecosystem
The fact that BioNTech chose the path to Nasdaq is no coincidence for Bialojan. “There is a race of investors in the U.S. saying: We are betting on the future.”
Germany lacks a functioning financing ecosystem. Biotech companies are concerned with new developments with high risk, long lead times and immense capital requirements, in contrast to IT or other tech companies, where products are developed more cheaply and reach the market within a shorter time.
This biotech constellation can only be financed with equity capital, not with money borrowed from banks. In Germany, however, there is rather a very pronounced debt capital culture. There is also a lack of risk-taking and powerful venture capital funds, i.e. funds with venture capital.
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First published in t3n, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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