International mega-trends and growth prospects of the Finnish biotechnology industry: Recent economic research and policy implications
Journal of Commercial Biotechnology,
Vol 11, No 2, s. 134-145
Raine Hermans, Martti Kulvik,
Pekka Ylä-Anttila (2005).
Abstract
The aim of this paper is to describe recent economic growth forecasts of the Finnish biotechnology industry and provide analysis of the international and industry-specific factors behind these forecasts.
The new economic geography of the European regions suggests that
spatial agglomeration of economic activities will be strengthened internationally if European
integration deepens. In addition to that, the Finnish pharmaceutical industry has enjoyed high
regulatory protection and it has achieved similar price mark-ups during the 1970s-1990s to its
counterpart in the USA. According to the analysis of small and medium-sized Finnish
biotechnology companies, it seems that the most promising biotechnology companies have a
well-balanced combination of intellectual capital. Despite expectations of rapid growth, it will
take decades rather than years for the biotechnology industry to catch up with the three
industrial pillars, the forestry, machinery and electronics industries. To fulfil the expectations,
there is a need to build collaboration and financing networks between the biotechnology
industry and traditional industries, such as forestry, electronics and pharmaceuticals. Most of
the current Finnish biotechnology companies are related to healthcare activities. The Finnish
biotechnology industry could offer solutions to the cost crisis in healthcare while at the same
time spurring development of an internationally competitive industrial cluster.