When talk turns to the Scandinavian life science sector, Sweden and Denmark – and the Øresund region that combines the two countries – are often in focus. But going forward, one might have to pay just as close attention to what happens further north, in the Norwegian capital city Oslo.

Over the past decade, an exceedingly strong life science environment has been developing here in the area around Oslo’s university hospital, Radiumhospitalet, and the biotech hub Oslo Cancer Cluster, as well as Oslo Medtech not far from there.

Benedicte Bakke, who is senior advisor for international healthcare in Norway-based financial services group DNB, believes the life science industry in Norway is now attracting international attention.

“Oslo Cancer Cluster has shown itself to be one of the most exciting and promising clusters, at least in the European space. They are rated as one of the top European biotech clusters and they are among the best environments for cancer research,” she says in an interview with MedWatch, adding:

INFO
  • Benedicte Bakke is Senior Advisor, International Healthcare, in DNB's International Corporate Division.
  • She has experience from the pharmaceutical industry with a focus on business development and has previously worked for international drug companies like Pfizer and Novartis.
  • Before joining DNB, she worked with innovation and business development for Inven2, which helps Norwegian companies to commercialize their research and inventions.

“I think the Norwegian healthcare industry has great conditions to be a very important industry for Norway going forward, because we have world-class research, we have a setup that allows for commercialization and we have a history of success.”

Acquisition marked the beginning

According to the senior advisor, international focus on the academic results created in Norway has increased. She points to the German life science giant Bayer AG’s takeover of Norwegian biotech Algeta in 2014 in a deal worth NOK 17.6 billion as proof of that.

The biotech had developed prostate cancer drug Xofigo, which now belongs to Bayer. That drug generated revenue of EUR 331 million last year compared with EUR 257 million in 2015 – an increase of nearly 29 percent.

Aside from the promising cancer medicine, Algeta also had some 180 full-time employees. A number of those workers went with Bayer to Germany, while a portion of them stayed in the life science environment around Oslo and some have moved on to other biotech companies.

Work lives on

“When the company was bought by Bayer, there were a lot of competencies and resources that were allocated to other promising companies. So other companies can capitalize on [the worked performed in Algeta]. The inventors of Algeta have started two new companies,” Benedicte Bakke explains.

She refers to Øyvind S. Bruland and Roy H. Larsen, who worked on the early development of what would become Xofigo and founded Algeta in 1997. Since then, they have also helped found the company Nordic Nanovector in 2009 and Oncoinvent the following year.

Both of these companies are members of the Oslo Cancer Cluster, which, in addition to a slew of local biotechs, also includes a bunch of international drug groups, local academic players, investment companies, and DNB itself.

Nordic Nanovector is the most mature of the smaller biotech companies in the cluster, and the company is rapidly advancing its lead candidate toward the market and enjoying great success on the Oslo stock exchange where it is one of just three companies from the cancer cluster.

The company’s CEO recently told Reuters in an interview that Nordic Nanovector could very well be the next Norwegian biotech to be sold to a larger player.

Improved funding environment

But Nordic Nanovector has also previously indicated that it wants to take its development as far as possible on its own, and only a few months ago it raised NOK 500 million for its clinical work.

Oncoinvent closed a funding round of its own recently, securing NOK 210 million, and in a general sense, the funding environment in Norway has improved immensely in recent years – not least due to the sale of Algeta and a general recovery of the stock market.

“Funding follows the development on the stock exchange to a high degree, so when the stock market falls on tough times, investors don’t invest in high-risk shares. Now we have a good environment on the stock exchange, and we have seen for at least half a year that it has been a very good environment for raising equity and doing IPOs,” says Benedicte Bakke.

Now we have a good environment on the stock exchange, and we have seen for at least half a year that it has been a very good environment for raising equity and doing IPOs."

— Benedicte Bakke, Senior Advisor, International Healthcare, International Corporate Division, DNB.

But although the Norwegian life science hub is attracting international attention, the funding still comes mainly from homegrown investors – at least for most of the biotechs.

“We have mainly Norwegian and Scandinavian companies [investing in the sector]. But when the companies develop and become more mature, we can see that international investors are interested - but not in the early phases,” the senior advisor says.

She points, for example, to the major investment fund HealthCap, which is also a member of the cluster and has posted millions in both Nordic Nanovector and Algeta.

Going beyond cancer

As the name suggests, Oslo Cancer Cluster focuses on research and development into a specific disease area. But in spite of the relatively narrow focus and what might appear to be a closed eco-system, the cluster collaborates with a number of other hubs around Europe, Benedicte Bakke explains.

Moreover, she believes that the potential in the Norwegian life science environment could stretch beyond oncology in time. She stresses that the Nobel Prize in Medicine was given to a Norwegian research couple for discoveries relating to the central nervous system in 2014.

She also points to a mayor licensing deal struck in the Scandinavian country recently, as Japanese drug group Astellas Pharma signed an agreement with the hospital Betanien in the city Skien and its research physician Anita Kåss for a hormone-based drug designed to treat rheumatoid arthritis, psoriasis, and sclerosis.

Astellas is paying NOK 800 million for the experimental drug and is also obligated to pay milestones and possible sales royalties to the hospital. Ole Kristian Hjelstuen, who is CEO of Inven2 - a company that helps to commercialize inventions in Norway – has called it the biggest license deal ever signed by a hospital in Norway.

“So Norway definitely also has excellent research in other areas. But in regard to commercialization, I believe that Oslo Cancer Cluster and Oslo Medtech are home to the most advanced companies,” Benedicte Bakke says and adds:

“But we do have other therapeutic areas in focus, and I think they will capitalize on what’s going on in the cancer research field and the commercialization happening there.”

  Nordic bio-bridge to the US is dominated by Swedes  

  Finland wants to form closer ties with Denmark

  Solomon has Danish ambitions for Norwegian company  

  Vaccibody raises more money than planned  

  Norwegian biotech prepares to raise NOK 200 million  

English edit: Martin Havtorn Petersen

Would you like to receive the latest news from MedWatch directly in your e-mail inbox? Sign up for our free English newsletter below.