Materia Medica Malaysiana

Korean vaccine-maker drawn to BioValley



A Korean biotech company is planning to set up Southeast Asia’s largest human vaccine plant in Malaysia’s BioValley, sources say.

Sources say the company, Glovax, will produce the Japanese encephalitis (JE) vaccine and plans to develop a vaccine for dengue as well at the Malaysian plant.

A source familiar with the plan says Glovax is looking to raise up to US$100 million (RM380 million) for this venture, with one of the main financiers being Malaysian Debt Ventures (MDV) Bhd.

The funds raised will be used to build the factory, for equipment purchase and hiring of scientists.

Glovax, a privately owned company, is renowned for its patents and production of the JE vaccine.

It has outsourced the production of the JE vaccine to a Chinese company in Chengdu, China. The Chinese plant is the only one producing the vaccine at the moment, catering only to the domestic market. Glovax is, therefore, looking for a location for a new plant and has decided on Malaysia, drawn to the BioValley initiative.

Glovax is believed to have been attracted to the BioValley because of its incentives such as a 10-year rent-free offer — an incentive expected to be one of the attractions to lure investments into BioValley.

“They are also attracted to Malaysia because of the availability of funds here, mainly MDV,” says a source close to the proposed plan.

Malaysia’s BioValley is situated on an 800ha site in Dengkil, Selangor, south of Cyberjaya and Putrajaya. It is within the larger Multimedia Super Corridor.

The RM2 billion BioValley, which will include research, commercial, educational, recreational and residential facilities, is expected to be fully completed by 2009.

Sources say that Glovax’s plan may also involve a number of financial backers apart from MDV, including government grants and private venture capitalists, due to the large amount of funds needed.

It is learnt that MDV is likely to ask for permission from the Japanese government to allow it to invest more than the current cap of 10% of its total funds.

MDV uses the money loaned from the Japanese government to provide loans to deserving technology and non-technology ventures in Malaysia and abroad, which traditional financial institutions will not fund.

Based on MDV’s total funds of RM1.6 billion, the 10% cap would mean that MDV could lend only up to RM160 million per company.