Creating a biotech sector

03 Nov 2010 | News
Estonia is using Structural Funds, Framework grants and international collaboration to build its science base and drive innovation.

These days, Helsinki residents routinely make the short ferry crossing to Estonia’s capital Tallinn to buy cheap alcohol. During the cash-strapped Soviet era, one enterprising individual used to travel in the opposite direction, in search of a wholly different commodity.

Erkki Truve, the newly-appointed vice rector for research at Tallinn University of Technology (TUT), recalls how he used to carry across radioisotopes obtained from friendly research collaborators in Helsinki, enabling him to work on experiments for his PhD. More than two decades later, he is still looking in the same direction when it comes to scientific co-operation. “We are mainly thinking about Finland and Sweden,” he says.

Although for many Estonia is most closely associated with its fellow Baltic States, Latvia and Lithuania, this term is less than a hundred years old, and glosses over significant historical and cultural distinctions. Linguistically, Estonia is closer to Finland than to its southern neighbours. Finland is also the country’s largest trading partner, followed by Sweden.

Almost two decades after Estonia regained its independence, the links with Scandinavia are stronger than ever. The Internet telephony company Skype represents its most obvious manifestation. The company was established by entrepreneurs from Sweden and Denmark, but the actual development of the system was done by a crack team of Estonian software coders.

EU funding supports good science

Beyond Scandinavia, the European Union is crucial to the development of Estonia's science base, via direct project funding from the Commission’s Framework Programmes and research infrastructure funding through the European Regional Development Fund.

Even though painful public sector cutbacks arising from the economic crisis have hit salaries and education budgets, the country’s government has remained committed to its science strategy. “They decided whatever cuts we are making, we are not cutting the co-financing of structural funds,” says Truve. As a result, performing good quality research in Estonia is feasible now, in a way that was unthinkable two decades ago. “I would not like to say we are outstanding,” Truve says. “It is possible to work here on quite a normal level.”

The Estonian Genome Centre, located in Tartu, is one proof of this. It will shortly complete one of Estonia’s flagship life sciences projects, the construction of a biobank with 50,000 tissue samples. The Centre has already carved out a presence in international genomics research consortia, with collaborators including scientists at the Broad Institute at Harvard University and Massachusetts Institute of Technology, and at Oxford and Cambridge universities in the UK.

The Genome Centre now plans to embark on a human genome sequencing initiative involving 500 individuals, including several trios of patients and their parents, who are affected by certain rare diseases, in a bid to identify the genetic triggers.

Competence centres promote commercialisation

Like many other countries in Europe and elsewhere in the world, Estonia has identified biotechnology as a research priority. To help close the gap between the academic research environment and industry, the government has, with the help of EU and industry funding, established a series of Competence Centres, which are intended to move innovations along the pathway towards commercialisation. Eight have been set up so far, of which four are in life sciences.

Tallinn has centres involved in cancer research and in food and fermentation technology, while Tartu is home to centres doing research on reproductive medicine and biology, and on the intersection between dairy products and health.

One of the centres, the Competence Centre for Cancer Research (CCCR) located in TUT, has already attracted international partners, having out-licensed a series of preclinical cancer compounds to US chemistry services firm Cambrex, of East Rutherford, New Jersey. Indeed, Cambrex is one overseas firm that has a presence in Tallinn, having acquired Prosyntest, one of the CCCR’s shareholders, in 2008.

The CCCR, which employs around 70 scientists, has ten development projects underway, including a proprietary method for cultivating natural killer cells, which could improve the safety of bone marrow transplant procedures.

Capturing the value of its innovation can be a challenge, however. “It is sometimes difficult for us to understand what is the commercialisable piece,” says the centre’s CEO Riin Ehin.

This is a wider problem affecting the country’s fledgling biotech sector as a whole – and one that Enterprise Estonia, the country’s industrial development agency, is working on. Its biotechnology programme has published an international tender, seeking expert input to bolster the 'biobusiness' skills of both existing and future entrepreneurs.

“We want to improve our knowledge on how to build up our IP management strategy,” says Olavi Otepalu, manager of the Estonian Biotechnology Programme. Improving sales and marketing capabilities, or “how to open the doors of big pharma” will also be part of the brief.

Emerging biotech champions

While Estonia’s efforts to develop a biotech sector remain early stage, the country’s links with Scandinavia are bearing fruit, and two of the more ambitious commercial biotechnology initiatives in the country have a strong Scandinavian connection.

One is FIT Biotech, a company developing a vaccine against HIV. Although headquartered in Tampere in Finland, FIT Biotech’s R&D takes place in Tartu, where its chief scientific officer Mart Ustav is located. The company came to prominence earlier this year, when it published promising data from a Phase IIa clinical trial of its HIV vaccine, FIT-06, in South Africa.

The vaccine led to a decline in the amount of virus in the blood and there was an increase in T-cell count, indicating the immune system had been activated by the vaccine to attack the virus. “There was a clear statistical difference from the placebo group,” says senior scientist Rein Sikut.

Ustav is also professor of virology at the University of Tartu, where he developed FIT Biotech’s proprietary plasmid vector system, which is used to deliver the vaccine to the immune system. Work at the Tartu site is generally about two to three years ahead of clinical development. “We are now improving the current vaccine – we are adding new components,” says Sikut. Further trials, in collaboration with Imperial College London, are in the offing. “The ultimate goal is to develop a good preventive vaccine,” Sikut says.

The second champion of Estonia’s emerging biotech sector is Celecure, which is based in Tallinn. The company has a connection with the Karolinska Institutet in Stockholm, where the company’s co-founder Priit Kogerman, now at TUT, carried out post-doctoral research on a receptor called CD44, which has a number of roles in cell-to-cell interactions, cell adhesion and cell migration. In cancer CD44 has apparently contradictory roles: it promotes metastasis or cancer spreading, while inhibiting angiogenesis or the formation of new blood vessels, a process that is essential to tumour growth.

Celecure has developed a fragment of CD44, called SB101, which retains only the receptor’s desirable activity of preventing the formation of blood vessels. It offers a new way of inhibiting angiogenesis, a commonly used strategy in cancer drug development. The company has been cooperating closely with prospective pharmaceutical partners, who have helped to guide preclinical research by providing feedback on progress. “We have, from the beginning, taken a very market-oriented approach to development,” says Celecure’s CEO Tarmo Kivi.

SB101 is still over a year from entering the clinic, however, and Celecure has had to shelve other programs in order to preserve its cash. The company has benefitted directly from Skype’s success. Ambient Sound Investments, a €100 million fund established by Skype’s four founding engineers, invested €1.6 million in 2007. But the present funding environment is difficult. “In the last couple of years it’s been very difficult to find new investment, so we've had to manage with what we have,” Kivi says.

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