The new listing rule introduced in 2018 by the Hong Kong Stock Exchange has transformed Hong Kong into a hub for initial public offerings in biotech by welcoming pre-revenue biotech companies to list on the main board. More than 100 life sciences and health care companies, including pre-revenue biotech, went public over the past five years, raising over HK$250bn (US$32bn) in total.
Hong Kong is also a major research location with active integration into national development, including eight State Key Laboratories linked to life and health sciences. It is also developing more top-of-the-range scientific and technological infrastructure, such as the Hong Kong-Shenzhen Innovation and Technology Park (HSITP).
“HSITP offers an environment that supports research, collaboration, innovation, and business growth,” says Vincent Ma, HSITP Limited chief executive officer. “This promotes sharing of expertise, research, and innovative ideas.”
Life sciences companies leverage Hong Kong’s international advantages, Ma adds. “Hong Kong excels in certain areas of research and development, such as biomedical sciences, financial technology and engineering,” he says. “Hong Kong also has strong intellectual property protection, a robust legal system, efficient regulations, and a business-friendly environment.”
Ma acknowledges there are challenges, both externally in the form of geopolitical tensions between China and other countries, and internally in terms of scale: Hong Kong as a small market needs to develop new markets, expand its talent pool and access enough capital. More collaboration with Shenzhen and its Guangdong-Hong Kong-Macao Greater Bay Area (GBA) hinterland would help mitigate those challenges, he adds.
Image of Hong Kong-Shenzhen Innovation and Technology Park
Government a key partner
One of HSITP’s key partnerships, Ma notes, is with the Hong Kong SAR government, which has provided policy support and guidance, helping businesses navigate regulations and requirements. “This support can streamline processes and create a favourable environment for I&T businesses to operate in,” he says.
The government earmarked HK$10bn (US$1.28bn) for the development of life and health technology, and launched another HK$10bn (US$1.28bn) programme known as Research, Academic and Industry Sectors One-plus Scheme to accelerate the transformation of research and development outcomes. The latter aims to help fund at least 100 research teams from universities with good potential to become successful start-ups to complete their projects within around five years.
The government also strives for a trial implementation of cross-boundary policies on innovation and technology co-operation covering the flows of I&T material, capital, data and people between Hong Kong and Shenzhen. “Government agencies often have strong local and international networks,” says Ma. “They can assist with market research and trade promotion and facilitate connections.”
Ma adds that HSITP’s physical location lures talent. “The proximity of Hong Kong and Shenzhen allows companies to access both the local and international markets. Companies can tap into the vast market potential in the GBA,” he says, highlighting the scale of the GBA, which covers nine major cities in Guangdong province plus the special administrative regions of Hong Kong and Macao with a combined population of more than 86mn and a market size of nearly US$2tn.
Collaboration across boundaries
Cross-boundary co-operation enables both mainland China and Hong Kong to combine the strengths and expertise of researchers, scientists and engineers. “Shenzhen and Hong Kong together have a deep pool of tech talents, and Hong Kong has five institutions ranked in QS World’s Top 100 Universities,” said Ma.
One of those five is the Hong Kong University of Science and Technology (HKUST). Nancy Ip, its president, says another government initiative fuelling Hong Kong’s development in biotechnology is the HK$10bn (US$1.28bn) InnoHK research clusters at the Hong Kong Science Park, which promote global research collaboration among top-notch local, mainland China and overseas institutions. So far, 16 research laboratories related to life and health technology have been set up under the InnoHK research clusters.
But Hong Kong, with its relatively small population of about 7.5mn, has limited medical data, even when the Hospital Authority, which manages Hong Kong's public healthcare, shares its well-documented records. That means researchers must collaborate to obtain data from larger patient pools, such as in the Mainland.
The government will establish the GBA International Clinical Trial Institute in the Hetao Shenzhen-Hong Kong Science and Technology Innovation Co-operation Zone in 2024 to provide a one-stop clinical trial support platform for medical research institutions, expediting R&D of new drugs and further developing Hong Kong’s position as a health and medical innovation hub.
Ip has seen the benefits of such co-operation first-hand as a researcher specialising in neuroscience. “I have collaborated with public hospitals and clinicians based both in Hong Kong and the Mainland to build one of the first comprehensive databases on Chinese Alzheimer’s disease populations,” she says.
Collaboration with frontline doctors and clinicians is also important for conducting trials to test the efficacy of new therapeutic drugs, devices or protocols, she adds. A joint study by HKUST researchers and clinicians from the Chinese University of Hong Kong shows how Covid-19 infections may lead to late pregnancy complications, paving the way for the development of potential molecular targets in future treatment.
Hong Kong University of Science and Technology
The importance of funding
World-class medical and life sciences research, Ip says, requires “sustained and substantial funding” due to the significant time and effort it takes to transform laboratory findings into real-world solutions. Institutions, including the Innovation and Technology Commission and the University Grants Committee, help “spearhead the development of life sciences research projects”.
As an international financial centre, Hong Kong is attractive to world-class pharmaceutical companies. “For example, AstraZeneca, a global pharmaceutical company, partnered with the Hong Kong Science and Technology Parks Corporation in 2021 to launch a co-incubation programme that supports biomedical start-ups,” says Ip.
In November 2023, AstraZeneca established an R&D centre and an incubation platform in Hong Kong. The R&D centre focused on research and development of medicines in key areas such as cell therapy and gene therapy, while the incubation platform assists start-ups and engages in collaboration with local universities, research institutions and I&T parks.
That co-operation, she adds, can help Hong Kong life sciences companies to “further their mission to develop integrated clinical solutions, accelerate innovation, foster local biomedical technologies, and enhance Hong Kong's position as a leading biomedical innovation hub”.
