Hong Kong’s Biotechnology ‘Trailblazer’
Imagine drinking a glass of water with only a few mineral salts added. It would be difficult to taste their presence.
Hong Kong-born entrepreneur Ricky Chiu takes an innovative approach to a similar issue, focusing in effect not on the ‘mineral salts’, but the ‘water’ in which they are suspended. His medical diagnostics start-up, PHASE Scientific International Ltd, says it utilises sample preparation methodology that could improve the accuracy of biological diagnostic testing by concentrating and purifying the sample to make the molecules easier to detect.
“Sample preparation is an upstream in diagnostic testing that many people do not pay attention to,” Mr Chiu told Innovation Hong Kong. “I have picked a niche to develop my business.”
He has more than a decade of experience in the biotechnology sector in the United States. After graduating from the University of California, San Diego in the 2000s, the Hong Kong-born entrepreneur worked for more than two years in a U.S. bioengineering firm focusing on rapid diagnostic testing. He thinks the stint was instrumental to developing his career.
“Rapid diagnostic testing really renders the results more quickly compared with lab testing, but the accuracy rate is not high,” Mr Chiu said. “I wanted to find solutions to improve this technology.”
He then spent six years studying at the University of California, Los Angeles for a PhD relating to diagnostic testing, and founded a company in the U.S. with an aggregate of US$10-million backing, including from U.S. agencies the National Science Foundation and the National Institute of Health. Two years ago, he incorporated the firm in Hong Kong as PHASE Scientific and set up the global headquarters in the Asian financial centre a year later.
“As I was born and raised in Hong Kong, I want to give something back to help the city, and it also makes senses to come back to this population-dense market [Hong Kong and Mainland China] for our technology,” said Mr Chiu. The CEO and chairman of the company was speaking from his office in the city’s Kwun Tong district.
PHASE Scientific says its sample preparation technology could be applied to two key areas: rapid point-of-care tests for infectious diseases to make the diagnosis more accurate and fast; and liquid biopsy for cancer screening, an area on which the company has placed greater emphasis in recent times.
“We now focus on the application in liquid biopsy, as there is huge demand and our solution could address the pain points felt by the industry,” Mr Chiu said.
Liquid biopsy is said to be a less invasive form of diagnostic technique – as far as patients are concerned – because it uses blood samples, rather than tissue biopsy, which would involve collecting samples from a target location or organ of the body. However, liquid biopsy is currently only used in the medical sector for screening for a few types of late-stage cancers, given the low concentration of DNA fragments of cancer cells to be found in human blood in early-stage cancers. PHASE Scientific says its technology could help concentrate and purify blood samples to make it easier to detect DNA fragments of cancer cells, thus allowing liquid biopsy to be viable for early-stage cancer screening and enhancing the accuracy of such testing.
“There are industry gold standards [about sample preparation in liquid biopsy] that have been used for 30 years or so, but our technology is much better and could disrupt the segment,” said Mr Chiu. “The industry has been undergoing rapid growth, and if we could step into the market at this early point, our company could develop more quickly alongside the organic growth of the market.”
PHASE Scientific will launch in the next few months its first product regarding sample preparation technology for liquid biopsy. The firm’s target market includes laboratories and institutions performing diagnostic tests. The CEO suggested the sector would be likely to welcome his product, because of the sector’s emphasis on new technology. “What we focus on now is facilitating the market to understand our technology. We attend conferences and present results in high-quality journals, so that the sector knows about our technology’s advantages and switches over,” Mr Chiu told Innovation Hong Kong.
PHASE Scientific has developed and readied a HKD80 tooth decay risk detection kit as its first product offering a rapid point-of-care test for infectious diseases. The company is now looking for a partner to assist in marketing it and helping with other relevant processes. The product could be officially launched next year, Mr Chiu said.
Opportunities and challenges
Part of the firm’s 35-strong labour force is in the U.S., and the other part is based in Hong Kong. “Half of our headcount is involved in R&D [research and development] and 80 percent of our resources have also been put into R&D, as our core value is our technology,” said the CEO.
Mr Chiu said that while the U.S. was a relatively mature market for biotechnology, Hong Kong was “still like a blank page”. He noted this “could translate to opportunities as there is no competition in the market,” but added it “could also mean challenges because there are no established investors, infrastructure and channels” for his firm’s product output.
Describing himself as “a trailblazer” in the Hong Kong biotech sector, Mr Chiu noted the biggest challenge for developing the market in the city was fund raising. “It’s difficult to find institutional investors in Hong Kong” for such products, he noted. Local investors were plentiful, but “don’t have expertise in the biotech area, so they might not be willing to take risks and make the relevant investment.”
In Mr Chiu’s perspective, one of the keys to overcoming this challenge is the degree of determination the Hong Kong government has to cultivate an “ecosystem” for the biotech sector. The U.S. already had government funding, angel investors, venture capital and other channels for funding, he noted.
Referring to the public sector in Hong Kong, Mr Chiu stated: “The government does not have to keep on providing support: once it has helped nurturing a few successful cases, the investors will gradually have more faith in the industry.”
While the Hong Kong authorities might be interested in providing a framework to support the sector, they were unlikely to offer a blank cheque, accepted Mr Chiu. He noted the success rate for biotech start-ups seeking U.S. government funding was below 10 percent, with a committee panel made up of industry veterans and academics meticulously looking into the technology and commercial potential of the projects applying for help.
“A government grant [in the U.S.] is like an endorsement, which will enhance the confidence of investors” thinking of getting involved in the funding of biotech start-ups, added Mr Chiu.
Recounting his experience of navigating for the past two years in the Hong Kong market, the entrepreneur noted it had been a “learning process”.
He stated: “I have no regrets for coming back here. What I am doing is meaningful and I’m happy to help the city in which I’ve grown up.”