BIOTECHNOLOGY AND LIFE SCIENCES

Biotechnology, the controlled use of living organisms or cellular constituents for practical purposes, has been recognized worldwide as a critical technology. As such, Japan has pursued biotechnology in various modes including Japan's Key Technology Center (JKTC) program. To date, 10 corporate biotechnology centers have been established over the span of 13 years (since 1985). The centers, both past and present, are listed in Appendix D.

While not all current centers were visited, a selection was made that permitted visits to centers that are characterized as old (established) or new, small or large, and practical or fundamental science in nature. Additionally, some centers are more oriented toward economic development in addition to establishing a base of science and technology.

While generalizations are always subject to reality checks by exceptions, the following comments apply to the centers visited and to the JKTC program. In addition, information was gleaned from other sources such as technical information presented by the JKTC headquarters, discussions with others in Japan, or prior information released by a specific company center.

• The JKTC program has had and continues to have a good portfolio of significant company centers dedicated to cutting edge biotechnology topics that are being pursued in other countries including the United States. As an example, the early days were focused on protein engineering, recombinant DNA, and plant cell technology. Current company centers are focused on functional genomics, bioinformatics, biophotonics and biomolecular engineering. Bioinformatics is a topic that is being pursued in a number of centers (Helix Research Institute-HRI and Biomolecular Engineering Research Institute-BERI), reflecting an interest and realization in Japan that this area is a critical one in biology.
• The centers have a good mix of both pragmatic and fundamental research efforts reflecting the composition of the member companies and the founding management of those centers. More fundamental centers include HRI and BERI. More pragmatic centers include Environmental Immuno-Chemical Technology Co. (EIC) and certain aspects of BioPhotonics Information Laboratory (BIL). For example, HRI's orientation of genomics reflects the founding manager's philosophy of the criticality of incorporating cutting-edge science in a new technology area (Teruhisa Noguchi, former CEO) and the interests of the majority of the corporate members that are pharmaceutical companies. Like in the United States and elsewhere, functional genomics holds much promise for drug development and is being actively pursued by HRI.
• A genuine commitment to economic development was seen in at least one center visited, namely BIL in Yamagata Prefecture. This center is housed in a technology park and has the financial backing of local and prefecture organizations. Economic development interests were also evident in discussions with management at that center. On the other hand, other centers, while still having a programmatic charge for economic development, were not particularly directed toward that objective. The centers located in large cities were less oriented to economic development and more toward achieving credibility through quality research results.
• The biotechnology centers, like other JKTC centers, were oriented toward achieving significant research results to satisfy the needs of the academic reviewers along with peer-credibility and recognition, and toward patent filings to satisfy the needs of industrial sponsors. While these two indicators of productivity have shortcomings, they are the ones that are the driving forces for all centers visited.
• The more fundamental and cutting-edge science-based centers (HRI and BERI) now have active participation by academic scientists in the form of permanent employees (academic researchers who decided to leave academia and join a center), visiting scientists (meaning actual research performance at the center for a defined period), and collaborating faculty (where the scientists retains his academic affiliation but where there is active collaboration of research results and students). This exchange is relatively new but real. Reasons gleaned from conversations include: the recognition of the value of academic ties (as done in the West); the background of key managers and scientists at these centers (many have been educated and trained in the United States and they like that model); and the need for ties in fast-moving areas of biotechnology such as genomics.
• The more fundamental and cutting-edge centers have a significant number of foreign (non-Japanese) scientists, especially in the form of postdoctoral fellows. This situation is a reflection of the need to bring in new and cutting-edge technology from abroad, in particular from the United States and Europe. Normally, the postdoctoral fellows stay for 2-3 years.
• The more fundamental and cutting-edge centers have significant publications in leading science and technology journals along with patents. As in the United States, both seem to be encouraged.
• One of the centers visited, BERI, was restructured successfully based on changing interests and needs of corporate sponsors and JKTC management. The original center, the Protein Engineering Research Institute, PERI, matured and was terminated by program dictates at the end of its time. However, BERI was then formed to pursue new directions in biomolecular engineering (that included not only proteins but also nucleic acids) as well as to take advantage of the large infrastructure of the established PERI laboratory facilities. The transition seemed to be quite positive and successful. Some personnel, however, were terminated at the end of PERI.
• While most JKTC centers visited have some similarity to other efforts being pursued in the United States in academic or industrial laboratories, BERI seems to have a unique distinction. First, BERI has an unequaled resource base in its laboratories and associated instrumentation and equipment all located in one place where interaction can easily occur. Second, BERI is focused on an important area-protein engineering-that is now getting renewed attention in the form of "proteomics," the study of relationships of proteins with genomics. Thus, BERI is well situated to make contributions to basic and applied areas coming from protein engineering that few other organizations could make. We are not aware of any other equivalent U.S. organization dedicated to biomolecular engineering that is so poised.

  As with other JKTC centers, the biotechnology centers have some inherent differences from centers in the West that can be viewed as either an advantage or limitation, depending on one's perspective. These differences include:

• Commitment: Once a JKTC center is formed, it is a given that that center will exist until its time for termination. This condition imparts stability for the staff and solidifies the area of research to be conducted. In contrast, most centers in the West are given short time periods (at times one year) before a review may dictate changes in management, area and approach.
• Evaluation: JKTC centers have minimal review and evaluation (compared to what is currently being done in the United States with equivalent activities). Minimal evaluation reflects a greater confidence in staff and management and a recognition that significant scientific and technical issues cannot be solved in 2-3 years. On the other hand, minimal evaluation can bring on complacency and mundane research.
• Management: Most managers at JKTC centers are former executives from leading Japanese companies engaged in these centers. The benefits are that management is mature and seasoned for such positions. Management also knows the ultimate end results that can be beneficial to the participating companies. On the other hand, management without young "hot-shot" and career-advancing persons may not bring forth the drive that is needed to achieve world-class results given the highly competitive and changing nature of biotechnology.

In summary, the JKTC centers dedicated to biotechnology have and continue to represent different areas of science (from genomics, biophotonics to immunology), different end applications (biopharmaceuticals, medical diagnostics, and environmental screening of pesticides), and different end industries (pharmaceutical, medical imaging, and industrial and agricultural chemicals). New areas have definitely been recognized (genomics and bioinformatics) and represent major activities now being pursued. Other areas such as tissue engineering, bionanotechnology, or combinatorial biology do not yet have a dedicated company center nor was there any discussion on such possibilities dealing with these topics in the immediate future during the site visits. Given the nature of how centers are formed, like in the United States, a champion for a particular effort needs to be there to make it happen.

New JKTC centers, as well as those involved in cutting-edge science, have more academic interaction and foreign scientist participation, reflecting the reality that science is now global and that hot biotechnology areas such as genomics are highly competitive. Some centers, in fact, are starting to have discussions with foreign firms as an outlet for their technology but not necessarily as participating members. However, foreign companies operating in Japan can be members and some indeed are members.