Thailand is a world leader in tropical medicine, health services, agriculture and food production. Biotechnology industry will help strengthen the countryus capabilities in these areas. Establishment of the National Center for Genetic Engineering and Biotechnology (BIOTEC) laid a strong foundation for biotechnology human resource development and R&D activities.
Thailand is a world leader in tropical medicine, health services, agriculture and food production. Biotechnology industry will help strengthen the countryus capabilities in these areas. Establishment of the National Center for Genetic Engineering and Biotechnology (BIOTEC) laid a strong foundation for biotechnology human resource development and R&D activities.
Thailand is a world leader in tropical medicine, health services, agriculture and food production. Biotechnology industry will help strengthen the countryus capabilities in these areas. Establishment of the National Center for Genetic Engineering and Biotechnology (BIOTEC) laid a strong foundation for biotechnology human resource development and R&D activities.
T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 8
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importance of biotechnology and the tremendous benefits of having a strong biotechnology sector. Given its position as a world leader in tropical medicine, health services, agriculture and food production, Thailand recognizes that the biotechnology industry will help strengthen the countrys capabilities in these areas and contribute to future growth and competitiveness. Since the early 80s, Thailand had already taken steps to encourage and nurture a fledgling biotechnology industry. Early initiatives such as the establishment of the National Center for Genetic Engineering and Biotechnology (BIOTEC) provided the necessary impetus and laid a strong foundation for biotechnology human resource development and R&D activities. Setting up of the National Science and Technology Development Agency (NSTDA) in 1991 reaffirmed the belief in building S&T infrastructure to build competitiveness and upgrading S&T capacity. In addition, with the approval of the National Biotechnology Policy Framework by the Thai Cabinet in 2004, the industry can now work towards a clear set of goals, namely in using biotechnology to promote the development of new bio-businesses, enhance the competitiveness of the Thai food and agriculture industries, raise the level of medical healthcare services in the kingdom, conserve the environment and produce clean energy, create a self-sufficient economy and develop qualified human resource. As a result, the local biotechnology industry has grown. Thailand has already attracted a number of multinational corporations to base their R&D activities here. It is also home to a rapidly growing international medical tourism industry whose world-class hospitals and medical professionals are bringing in more than a million visitors a year from around the world. Biotechnology is todays frontier of Science and BIOTEC, which has since become a part of NSTDA, has used various NSTDAs instruments in playing a key role of creating a conducive research environment, a critical pool of talents and effective infrastructure and tools that will enable biotechnology to benefit the country and the well being of the people. Furthermore, we are continually strengthening the industry by bringing together multiple disciplines, synergizing with key partners and promoting both local and international collaborations. Market-driven initiatives such as the Thailand Biotech Guide which showcases the local industry and provides access to important market information, is evident of an industry that is moving to the next level of development. I hope the readers will gain insights into Thailands biotechnology industry and come to appreciate the many prospects and opportunities that are abound here. Sakarindr Bhumiratana, Ph.D. President National Science and Technology Development Agency (NSTDA) T Message biotech 6/10/06, 10:35 8 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 9 ver the years, with sustained commitment from the government and concerted efforts from the relevant agencies, Thailand has focused on developing a biotechnology base that will bring its agriculture-dominant economy to the next level. Agencies such as BIOTEC, NSTDA and the BOI have worked closely together to promote the long-term growth and development of Thailand's biotechnology sector. Through their efforts, the creation of biotechnology incentives, funding and other forms of support were undertaken specifically to provide an environment conducive for growth in this important sector. And now we are starting to see the emergence of a promising industry that currently boasts a small but increasing number of biotechnology companies. The creation of the Thailand Biotech Guide by an industry-driven consortium is another indication that the sector has reached an important milestone. The demand for key industry information has now reached critical mass. I am confident that this new publication, the Thailand Biotech Guide will become an invaluable resource for the local biotechnology industry, as well as foreign companies and investors. My best wishes to the publishers, and I look forward to seeing this publication grow as Thailand's biotechnology industry powers forward into the future. Satit Chanjavanakul Secretary General Board of Investment O Message biotech 6/10/06, 10:36 9 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 11 ince adopting the National Biotechnology Policy Framework in 2004, Thailand has made significant progress in developing the necessary infrastructure and nurturing specific sectors in its growing biotech industry. There has been increasing interest in the local biotech industry especially from potential foreign investors that are keen to learn about the countrys focus and strengths in the biotech field. The Thailand Biotech Guide is created to provide comprehensive coverage of the operational details related to the establishment of a local biotech operation and enterprise. Our aim is to develop a publication that presents relevant and practical information to all potential stakeholders and contributors to the Thailand biotech scene. We envisage that the guide will become an important source of reference for the local biotech industry and will help promote Thailands biotech sector to the world. We will like to take this opportunity to thank our advertisers for their support, without which this guide will not have been possible. We hope that you will find this guide useful and we look forward to your comments and feedback to help us improve this publication further. Please feel free to drop us an email at feedback@biotechthailand.com. Co-Editors S Derrick Tan, Ph.D. Managing Consultant 1st Phase Operations Marvin Ng, MBA Business Development Consultant Greener Grass Communications Editorial preface 6/10/06, 10:42 11 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 15 Thailand Land of Investment Opportunities Thailand is a key economy in South East Asia, with an estimated population of 66 million and a gross domestic product (GDP) of over 7,100 billion baht or US$ 186 billion in 2005. Having weathered the Asian financial crisis in 1997, Thailand has undergone a remarkable economic transformation which propelled the economy from about minus 10% growth to almost 7% growth in 2003. Although economic performance has slowed down in 2004 and 2005 due in part to rising oil prices, the 2004 tsunami and the outbreak of avian flu, the economy has remained robust, with 2005 GDP growing at 4.7%. In 2005, Thailand was rated the third most attractive FDI destination in Asia (behind India and China) by a UNCTAD survey. The kingdom is host to a growing number of MNCs operating out of Asia for a few reasons. Firstly, Thailand has a sizeable and growing economy with a substantial domestic market that represents significant opportunities for companies interested in tapping into local demands. Secondly, Thailand is committed to creating a business-friendly and low-cost operating environment that is conducive to foreign companies. Other key factors contributing to Thailand's attractiveness as a preferred investment destination include its young and educated workforce, its geographical location and its excellent logistic infrastructure. Thailand has already established itself as a global base for a number of industries such as the automotive, electronic and education sectors. For instance, world-class automotive players such as Honda and Toyota both have significant manufacturing and R&D operations in Thailand that cater to the global market. Similarly, Thailand is also the world's largest hard disk drive producer with most of the leading hard disk drive players such as Seagate, Western Digital and Fujitsu, tapping on the unique strengths of Thailand and investing in major manufacturing and development operations in the country. In the same way, biotechnology companies are discovering Thailand as a promising investment destination. The country, which is a hot spot in bio-diversity, has a large domestic and regional market, as well as a ready supply of competent scientific workers and scientists. Furthermore, it has developed dedicated infrastructure and has put in place, attractive schemes and incentives to support the industry. The Thailand BioIndustry An Up and Coming Sector Thailand regards biotechnology as an important industry sector that needs to be developed in order to strengthen its global competitiveness. The Thai government has recognized the tremendous value of biotechnology in enhancing economic productivity, especially in the agriculture and food sectors which are mainstays of the Thai economy. In particular, there is strong interest to use biotechnology for a variety of activities including processing food, Editorial biotech 1 6/10/06, 10:57 15 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 16 increasing value-add of products, improving the genetic stock of plants and livestock, developing diagnostics, enhancing aquaculture and developing biological control. As early as the 1980s, initiatives such as the creation of the National Center for Genetic Engineering and Biotechnology (BIOTEC) were launched to promote the development of the local industry. More recently, the Thai government developed the National Biotechnology Policy Framework (2004-2009), which aims to bring about US$125 million in R&D investments and the creation of more than 100 new biotech-related companies in the next few years. To meet these objectives, the government has provided significant resources to create an environment conducive for the growth of biotechnology industry including setting up a dedicated BioPark for R&D, creating training and business activities as well as establishing incentives and assistance programmes aimed at promoting the industry. Key clusters within the bioindustry in Thailand include the Agri-biotech sector, the Medical sector and the Food sector.
Agri-Biotech Sector Thailand is a major agriculture exporter, with more than a third of its land being arable and about half of the country's labour force involved in agriculture. In 2005, the country's agriculture output contributes 8.7% to its GDP. Thus, the Thai government has long realized that biotechnology, applied to the country's agriculture base, can bring tremendous benefits to the economy and people. With a large industrial base, in-depth experience and expertise in this area, Thailand possesses significant strengths in biotechnology within the agricultural sector and is already home to a number of international companies such as Bayer Cropscience, Monsanto and Syngenta. The country is now leveraging upon biotechnology advances to further develop the field and grow the industry. For example, marker assisted selective breeding has been used to develop disease resistant crops such as rice. Similarly, recombinant DNA techniques are used to produce more hardy transgenic plants including tomato, papaya and pepper. Biotechnology is also finding its way into other areas such disease (livestock and crops) diagnostics and agricultural product traceability. Within the same sector, biotechnology is playing an increasingly important role in the production of biofuels and materials from agricultural biomass. One specific example is the government's active support for projects related to the production of bioethanol from cassava, sugar cane and other agricultural materials, in an effort to augment the country's energy needs. In the area of human resource development for the agri-biotech sector, Thailand is not only focusing on its own needs but also those of the region. It is establishing itself as a regional hub for training and development. For instance, the Asian Development Bank has sponsored training initiatives that are based in Thailand which reach out to participants from neighbouring countries. This aims to strengthen the agriculture capacity and advanced agricultural science and technology cooperation among nations in the region.
Medical Sector Thailand is poised to become the region's leading healthcare hub with over a million medical tourists arriving each year seeking treatments including cosmetic surgery, dental work, hip and knee replacements and back surgery. Thai doctors and other medical staff study abroad, speak international languages and are among the best qualified in the region. Many private hospitals have translators to facilitate convenient communication with foreign visitors. The hospital facilities themselves offer spacious, luxurious accommodation and in some ways seem more like five-star hotels, with in-house Editorial biotech 1 6/10/06, 10:57 16 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 17 restaurants and food courts, spa and fitness facilities. Tourists from the United States, Europe and increasingly the Middle East are attracted to Thailand specifically because of its high-quality, attractively packaged and very affordable medical treatments. Furthermore, Thailand also offers medical treatments that are sometimes unavailable to these medical tourists back in their home countries, for example stem cell therapies. In 2005 alone, medical tourism brought in more than half a billion dollars for the Thai economy. With its superb medical healthcare infrastructure, well-trained medical personnel and a growing research base, the sector is poised to become a major clinical development center in the region. Thailand has established a number of initiatives to make this happen. For example, it has undertaken the Thai Pharmacogenomics Project with the aim of creating a comprehensive clinical database that will ultimately facilitate new drug discovery efforts with leading pharmaceutical companies and reduce healthcare costs. Thailand is also at the forefront in the application of stem cell technology. There are already organizations in the country that offers commercial applications such as cord blood banking and stem cell therapies.
Food Sector Thai food industry is the most dynamic and diverse in the world. The sector contributes significantly to the country's growth and prosperity. More than 11.72% of the country's total exports originate from the food sector, and the industry, together with the agriculture sector, employs almost 20 million people in 2003. There are about 10,000 food-related manufacturing operations in Thailand and 80% of the raw materials that go into production are harvested locally. Given the importance of the sector, it is not surprising that the industry is continuously looking to improve itself. This presents further opportunities for companies to improve upon existing production or add value to existing products through the use of technologies including biotechnology. In general, the sector is moving towards higher value-added, functional foods and nutraceuticals. It is also developing a more robust value chain that incorporates higher standards, better safety and strong regulations. For instance, Thailand's shrimp industry has managed to raise its productivity and stay ahead of other food exporting countries through the effective deployment of biotechnology. The industry has benefited from initiatives such as the Shrimp Genome Project and the Shrimp Traceability Project which have helped to improve the shrimp breeding and cultivation as well as raise the quality and safety standards of the industry respectively. More details on opportunities in Thailand biotechnology industry can be found online at the BIOTEC website at h t t p : / / www. b i o t e c . o r . t h / b i o t e c h n o l o g y - e n / newsdetail.asp?id=1420. The National Biotechnology Policy Framework Providing Clear Directions The National Biotechnology Policy Framework was formally established in 2003 with the aim of developing a competitive and self-sufficient Thai biotechnology industry. restaurants and food courts, spa and fitness facilities. Tourists from the United States, Europe and increasingly the Middle East are attracted to Thailand specifically because of its high-quality, attractively packaged and very affordable medical treatments. Furthermore, Thailand also offers medical treatments that are sometimes unavailable to these medical tourists back in their home countries, for example stem cell therapies. In 2005 alone, medical tourism brought in more than half a billion dollars for the Thai economy. With its superb medical healthcare infrastructure, well-trained medical personnel and a growing research base, the sector is poised to become a major clinical development center in the region. Thailand has established a number of initiatives to make this happen. For example, it has undertaken the Thai Pharmacogenomics Project with the aim of creating a comprehensive clinical database that will ultimately facilitate new drug discovery efforts with leading pharmaceutical companies and reduce healthcare costs. Thailand is also at the forefront in the application of stem cell technology. There are already organizations in the country that offers commercial applications such as cord blood banking and stem cell therapies.
Food Sector Thai food industry is the most dynamic and diverse in the world. The sector contributes significantly to the country's growth and prosperity. More than 11.72% of the country's total exports originate from the food sector, and the industry, together with the agriculture sector, employs almost 20 million people in 2003. There are about 10,000 food-related manufacturing operations in Thailand and 80% of the raw materials that go into production are harvested locally. Given the importance of the sector, it is not surprising that the industry is continuously looking to improve itself. This presents further opportunities for companies to improve upon existing production or add value to existing products through the use of technologies including biotechnology. In general, the sector is moving towards higher value-added, functional foods and nutraceuticals. It is also developing a more robust value chain that incorporates higher standards, better safety and strong regulations. For instance, Thailand's shrimp industry has managed to raise its productivity and stay ahead of other food exporting countries through the effective deployment of biotechnology. The industry has benefited from initiatives such as the Shrimp Genome Project and the Shrimp Traceability Project which have helped to improve the shrimp breeding and cultivation as well as raise the quality and safety standards of the industry respectively. More details on opportunities in Thailand biotechnology industry can be found online at the BIOTEC website at h t t p : / / www. b i o t e c . o r . t h / b i o t e c h n o l o g y - e n / newsdetail.asp?id=1420. The National Biotechnology Policy Framework Providing Clear Directions The National Biotechnology Policy Framework was formally established in 2003 with the aim of developing a competitive and self-sufficient Thai biotechnology industry. Editorial Page 17 6/10/06, 14:57 17 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 18 The framework provides direction over a period of 6 years (2004-2009), with 6 specific goals for the development of the industry as follows:
Emergence and Development of New Bio-Business To encourage investment in R&D and establish biotechnology companies which can tap on new opportunities in both high value-added manufacturing (e.g. production of medical diagnostic kits and supplementary food) and services (e.g. molecular-level detection and analysis for medical care, public health, agriculture and biosafety).
Biotechnology Promotes Thailand as Kitchen of the World - To use biotechnology to enhance Thailand's competitiveness in the agriculture and food industries. The goal is to increase the export value of the country's raw and processed agricultural products.
Thailand Represents Healthy Community and Healthcare Center of Asia - To utilize biotechnology to improve the medical healthcare of the nation and to establish Thailand as a lead hub for healthcare services in Asia.
Utilization of Biotechnology to Conserve the Environment and to Produce Clean Energy - To apply biotechnology to the conservation and management of the environment including energy production from waste, improvement of soil quality, recycling as well as the inspection, surveillance, treatment and rehabilitation of the environment.
Biotechnology as the Key Factor for Self-Sufficient Economy - To conserve and optimize the use of biological resources that are important to, or specific in, various local communities. The goal is to use biotechnology to extend the usefulness of traditional know-how, expand the diversity and value of local resources and resource-based products and to improve the quality of these products.
Development of Qualified Human Resource - To put in place infrastructure, resources and manpower development programmes to create a quality workforce that will support the growth of the industry. More details on the NBPF can be found online at BIOTEC website at http://www.biotec.or.th/biotechnology-en/policy.asp. Strong Infrastructure to Support the Developing Industry To support the development of the biotechnology industry, Thailand has been putting in place critical infrastructure necessary for industrial growth. The following section describes some of these in detail.
The Thailand Science Park Located at the northern outskirt of Bangkok, the Thailand Science Park represents the nation's first key infrastructure development to promote its science and technology research and development. The 80 acre park was completed in 2002 and is currently managed by the team from the Technology Management Center under the purview of the National Science and Technology Development Agency (NSTDA). The Park is currently undergoing Phase 2 expansion, while planning for Phase 3 development is already in progress. Editorial biotech 1 6/10/06, 11:00 18 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 19 The Park aims to be a fully integrated R&D hub to promote the translation of innovative public R&D to the private sector, as well as to provide training to advance the country's critical mass of R&D professionals. To show its resolve to make the Park the focus point of Thailand's science and technology activities, NSTDA houses its central administration and various centers of excellence here. These include: National Center for Genetic Engineering and Biotechnology (BIOTEC), National Electronics and Computer Technology Center (NECTEC), National Metal and Materials Technology Center (MTEC), and National Nanotechnology Center (NANOTEC) In addition to these national centers, the Park provides ready built research, pilot plant and business incubation space for rental and long-term leasehold lands for companies to construct their own research facilities. The Park management also provides its tenants with one-stop services in the areas of technology and technical, financial, human resource, business and juristic support. Other benefits include access to government research grants, soft loans, joint investment by NSTDA and eligibility for Thailand Board of Investment's tax incentives (BOI Zone 3 incentives). In the area of biotechnology, the abundance of state-of-the- art research activities in agriculture, food and medical biotech R&D have drawn an increasing number of companies to set up shop within the Park. The Park currently houses over 50 private companies, of which one third are active in biotechnology. Some of the notable companies include TV SD PSB (Thailand) Ltd., Betagro Group and the Shrimp Biotechnology Business Unit. Over the years, there is also a growing culture of scientific collaboration among BIOTEC, the universities in the vicinity and private companies located within the Park. BIOTEC also provides access to its many core resources to private tenants at the Park, such as the BioService Unit and DNA Technology Laboratory. An ecosystem of biotech activities is taking shape at the Thailand Science Park. More information about the Thailand Science Park may be found at www.sciencepark.or.th. With an aim of further developing the biotechnology sector, the National Biotechnology Policy Committee recently approved the expansion of the current biotech cluster infrastructure at the Thailand Science Park into a full-fledged BioPark. A sum of US$16.5 million has been allocated to create an additional 40,000 sqm biotechnology lab space by 2009, some of which will be BSL-3 level bio-containment facilities for use by private companies and public institutions. Editorial biotech 1 6/10/06, 11:00 19 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 20 When completed, the BioPark will be Thailand's first biotech hub to promote the advancement of life sciences research and new bio-businesses.
The Industrial Estate Authority of Thailand Established in 1972, the Industrial Estate Authority of Thailand (IEAT) under the Ministry of Industry is tasked to oversee the country's industrial development policies. In addition, the state enterprise implements guidelines and control measures to protect the country's environment against harmful industrial pollution. IEAT has developed more than 30 Industrial Estates across the country, either on its own or jointly with private developers. These estates are generally equipped with many of the essential infrastructure needed for a successful industrial operation. As such, many biotech companies have chosen to locate themselves within such estates to enjoy the many privileges and incentives offered by IEAT. For example, the agency provides a one-stop service to grant licenses and permits necessary for operation initiation. It also allows foreign investors to purchase the land they occupy within certain estates. Additional information on the various IEAT Industrial Estates and the privilege schemes available may be found at www.ieat.go.th. Other than these industrial estates, private developers also offer ready spaces or leasehold lands at various Industrial Parks to potential investors. However, tenants in such Industrial Parks are not eligible for IEAT incentives. In addition, they do not have access to IEAT's business licenses and permits facilitation services.
Investment Zones Thailand's Board of Investment (BOI), through the enactment of the Investment Promotion Act, divides the country into several economic zones based on the regions infrastructure availability and the local citizens income levels. These zones serve as a guide for the agency to direct different investment opportunities to the various regions and to provide added incentives to promote investment into the lesser developed provinces. Editorial biotech 1 6/10/06, 11:01 20 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 21 Different tax and duty incentives and privileges are offered by BOI at each of the zone. Details on these incentives may be found at the BOI website at www.boi.go.th/english/about/ boi_privileges_by_location.asp. Public R&D Focusing on Thailand's Strengths Much of the biotechnology R&D activities in Thailand are concentrated in public research institutes and university research centers. These organizations conduct a range of research from publ i cl y-funded upstream R&D to commercially-driven collaborations with companies. With Thailand's long history and experience in agriculture, aquaculture and food production, strong biotechnology expertise can be found in areas including tropical disease, immunology, food science and technology, fermentation and certain areas of plant biotechnology. Furthermore, given the country's rich biodiversity, Thailand has established large germbanks and natural products libraries for use in agriculture research and screening for bioactive compounds. One of the leading biotechnology research institutes in Thailand is the BIOTEC Central Research Unit, which was established in 1996. It is the largest in-house research unit under BIOTEC and NSTDA and conducts basic and applied research as well as provides technical services to the industry. Private R&D Activities Commercially Driven and Close to Market Although biotechnology R&D activities are concentrated mostly in public institutions, private sector R&D activities are also growing. Increasingly, companies are working closely with public R&D institutes and the universities to develop new products and innovations. Some of the established local firms in the agriculture and food industries collaborate with the local institutions in areas such as agricultural biotechnology. One example is the Betagro Science Center, initiated and funded by Betagro Group (one of Thailand's largest agricultural and animal husbandry companies), which is the nation's latest private advanced agro-based R&D institute. The institute focuses on food safety - detecting bacterial, viral or chemical contamination in products; this includes the detection of emerging animal diseases, such as the Avian flu. In addition, Thailand is gradually being considered by global firms as a base for R&D activities. It has attracted a number of foreign investors that have established R&D activities and research collaborations with local R&D organizations. Leading international companies such as Shiseido and Novartis currently work closely with NSTDA research centers. For example, in 2005, Novartis established a three-year partnership with BIOTEC aimed at developing new medicines based on natural products found in Thailand. Human Resource Development A Critical Component Thailand recognizes that it must have a good pool of scientists, doctors and other biotechnology professionals to support the nation's developing biotechnology industry. At present, there are a total of 24 public and private universities that offer a program in biotechnology. Of these, 14 offer the program at post-graduate level i.e. Masters or PhD. In addition, there are joint research centers between BIOTEC and leading local universities that provide research programs whi ch contri butes to human resource development. The Center of Excellence for Shrimp Molecular Biology and Biotechnology at Mahidol University and the Rice Gene Discovery Research Unit at Kasetsart University are examples of such successful collaborations. Besides the universities and joint research centers, a new breed of problem-based learning institutes have also been set up. These institutes focus on R&D training that addresses the specific needs of the private sector. The Chemical Engineering Practice School (ChEPS) and Food Engineering Practice School (FEPS) which were developed in collaboration with King Mongkut's University of Technology Thonburi (KMUTT), are successful examples which have produced graduates with skills and knowledge sought after by the industry. Editorial biotech 1 6/10/06, 11:05 21 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 22 The BIOTEC and NSTDA has committed to 244 national and international scholarships/fellowships per year in order to strengthen and develop capabilities to cope with technology changes and future manpower demand. In all, these programs help ensure a steady supply of quality manpower that will meet the raising demands and requirements of research institutes and new biotechnology companies setting up in Thailand. Thailand is also building up biotechnology research capacities for the region. In 2001, Thailand, through BIOTEC, initiated the Human Resource Development Program in Biotechnology for Neighbouring Countries. The program which is funded by the ASEAN Foundation and the New Zealand UNESCO Commission has trained a steady stream of researchers from ASEAN countries and also provides a networking platform for ASEAN researchers. Support Schemes and Government Incentives Promoting the Industry There are a variety of assistance schemes and incentives from government agencies to assist and attract biotechnology companies to set up presence in Thailand. The BOI is the main government agency offering privileges and incentives to investors. Companies that invest in biotechnology or biotechnology-related businesses in Thailand may receive tax or non-tax privileges if their projects receive approval from the BOI. Tax privileges comprise of corporate income tax exemption for up to 8 years, import duty reductions or exemptions on machinery and raw materials. Non-tax privileges include land ownership rights for foreign investors, permission to bring in foreign experts and technicians, and rapid processing of visa and work permit applications. Companies with R&D activities can also apply for 200% tax credit on R&D activities from the Thai Revenue Department. Biotechnology investors may qualify for financial support packages from several other organizations. For example, the Technology Management Center (TMC) offers grants and soft loans for R&D or to upgrade manufacturing processes for up to 75 percent of the project budget for technology development projects (not exceeding US$750,000) at a competitive interest rate. Various other programs are available from the TMC including the Industrial Technology Assistance Program (to provide financial support to companies seeking external experts from Thailand and overseas) and the Support for Technology Acquisition and Mastery Program (to facilitate technology transfer). The National Innovation Agency (NIA) under the Ministry of Science and Technology can also offer financial support and technical services for innovators seeking marketing assistance. NIA can award soft loans of up to US$125,000 for marketing and feasibility studies. In addition, NIA can also enter into joint ventures (with less than 25% equity) with companies and other investment organizations if such arrangement can result in significant innovation. Moving Forward Thailand will continue to establish itself as a major biotechnology player in the region. With a clear focus that leverages upon the nation's advantages, Thailand will concentrate its efforts on key areas of biotechnology R&D. It will also continue to enhance its supporting infrastructure and boost the quality and quantity of its human resource. The establishment of the 40,000 sqm BioPark by 2009 which will accommodate Agro-business, life sciences research, an incubation center and a pilot plant, will enhance the country's competitiveness in the bioIndustry. Thailand's new Suvarnabhumi International Airport, which has the largest terminal building in the world (563,000 sqm) with a capacity to handle 45 million passengers and 3 million tonnes of cargo per year, will enhance the country's global logistic network. Finally, the setting up of a regional training center in biotechnology with the support from UNESCO, FAO and the Rockefeller Foundation will help develop strong research capabilities in the region to meet future demand for qualified manpower from industry. These and various developments are set to make Thailand a preferred location for foreign Biobusiness in Asia. Editorial biotech 1 6/10/06, 11:06 22 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 23 Forms of Doing Business Types of Companies A Thai or foreigner may engage in business in the form of a partnership, limited company, a joint venture, a branch of a foreign corporation, or a representative/regional office.
Partnerships There are 3 types of partnerships and they differ principally in the liability attached to each: An unregistered ordinary partnership has partners who are all jointly liable, without any limitation on the partnership's total obligations. This type of partnership is not a legal entity and is subject to taxation as if it were an individual. While there are many advantages to using the ordinary partnership business organization, its use by foreigners is limited by the Foreign Business Act (FBA), if it engages in a business that is restricted under the FBA. An ordinary partnership owned by Americans may apply for treaty protection under the Treaty of Amity and Economic Relations. A registered ordinary partnership is a juridical entity having a separate and distinct personality from each of the partners by virtue of its registration with the Commercial Registrar. It is treated as a corporate entity for income tax purposes. Generally, the registered ordinary partnership form of business organization is not very popular, since it offers little or no apparent tax advantages and little or no protection against liability. A limited partnership is a form of registered partnership, in which there are one or more managing partners who manage the business and who are personally liable for the partnership's debts, and one or more partners who are not normally personally liable for the partnership's debts, except for their undelivered or withdrawn capital contributions. The partnership agreement, including the details of capital contribution, management and objects, must be filed with the Ministry of Commerce, in the same manner as a registered ordinary partnership. Limited partnerships are a popular form of business organization, since they provide an aspect of limited liability with fewer formalities than are required of limited companies. Editorial biotech 2 6/10/06, 11:02 23 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 24
Private Limited Companies The private company is the form of business organization that is most popular with foreign businessmen, because there is flexibility, especially in joint venture situations, in formulating how the company may be controlled and managed. The company may be wholly owned by foreigners. However, in those business activities reserved for Thai nationals, foreign participation is generally allowed up to 49%. The liability of the shareholders is limited to the par value of the authorized capital. The liability of the directors, however, may be unlimited if so provided in the company's memorandum of association or the articles of incorporation. The limited company is managed by a board of directors according to the company's memorandum and by laws. Although there is no established minimum level of capitalization, the private limited company's capital must be sufficient to accomplish its objectives. All of the shares must be subscribed to, and at least 25% of the subscribed shares must be paid up. Thai corporate law has some features, which may be unfamiliar to foreign businessman. Limited companies are subject to corporate income tax at the general rate of 30%. Private limited company's shareholders must never be fewer than seven at all times.
Joint Ventures The term "joint venture" refers to unregistered partnership, in which at least one of the partners is a juristic person and which carries on business whereby the parties maintain joint accounts and share profits. A significant aspect of a joint venture is that it is taxed as a juristic person at the general rate of 30%.
Consortiums A consortium is similar to a joint venture, in that the parties to a limited degree act together in a business enterprise. However, unlike a joint venture, they maintain separate accounts and do not share profits. A consortium does not pay income tax as such, but the parties to the consortium pay their own taxes.
Branch offices A foreign juristic person may do business in Thailand by establishing a branch office and also complying with any relevant laws relating to its business. If the branch office intends to engage in a business that is restricted under the Foreign Business Act, then it must apply for a license. If the company establishing a branch is an American company and can comply with the provisions of the Treaty of Amity and Economic Relations, the branch office may apply for a treaty protection letter from the Ministry of Commerce and thereafter engage in any business, except those excluded by the treaty. If the treaty is applicable, the American company must apply for a certificate, but need not apply for a license under the Foreign Business Act. Since a branch office is for legal purposes a part of the parent company, the parent is liable under civil and criminal law for all the acts and omissions of the branch office. Editorial biotech 2 6/10/06, 11:03 24 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 25
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Editorial biotech 2 6/10/06, 11:03 25 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 26 . +- -..- ++.- ,++.. -.-.- -..- .- . ,--., -...-+ . ., -, .-, . .++. .- .. ,..., +--... .-.. -..- .++, ..+.. ..+, .-., +.+. .+ -.., +,-.. . + .-.-. .+ .- -,+--. . ., ....., ... .-+ .- .-- s.-++- ,.+-+ -, .-, ...-+ .. - .. sa .- .-- -,+-+ ++- .- .. . .- ,...+. +- ....., . -...-+ ++- ., .- .-- s.-++- ++- ., .- .. .- .-- .- ... -, .-, i- e.-+ s...- i..+ i-.., ., e+- . i-.., -.. .+ i. ..- .+ .,.. .- ,..-+ ,-.. ,---.. ,. ..-, .- .-, +-- -.. .- .+.- i- -, .-, -... +.+-+ ..- .- +.-+ .- ..- -. i- +...i..+ --- i.+- ,---. (i-i, ... . -.. ... . ,.. ,---.. ,. . +... .-. .+ .,.- . +- +--. ++.- i..+ +. +,-.. . +-..-+ .+. s+. ,. ., - ,-..- .. .- ,. ....- ++- .- --, s+- .. .- .,,..- .. (-- ..-, ..+,, .- . +... +.++. .,., .+-, -.., +, .,., i..+ . ., - -.-., . -- . i-i . ..-.. .-.- +... .-. ..- ., ,-.. ,. . . +. . +- i- -..-+ ,. +- .-, -,,-+ , +... .-. .. --...- . .-.,, -.. .- +.-+ .- ..- -. Exceptions Business and relevant law Minority foreign ownership Majority foreign ownership -s s.-++- +-- -s s.-++- z s+-- -s s.-++- s +-- es i..+ i-.., ., ., +-- x ,- -,+-+ x ,- -,+-+ x ,- -,+-+ x ,- -,+-+ x. ,- .. ,- .- ..-. +, . sa .+ ,, +, . :s +. .-- . +-.. +. - i. .. ,- .- --, s+- s-,.. +, . aa -, .-, ...., -,+--. +-..z x ,- -,+-+ sa. ., . ,.. ,- +,-.. . sa. ., . ,.. ,- +,-.. . z s+-- -.++-+ .- i-.., -,... .+ ..+. -+.- +-.. ..+- +, -+ .,.+.+. ,++.. Nature of business New foreign ownership limit under TAFTA Previous foreign ownership limit i-.., -++... ..+. ,-.., .-.- .+ .-.,, ++ (. -..- +- ++- -s s.-++- s, sa +. +. - ...-+ +.+- s., Editorial biotech 2 6/10/06, 11:03 26 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 27 Promoted investment i- s.--. -- . +- .+-. . +,,. ,...- +- .-.-. ..-.-. ,. , .- s.+ ..-.-. (sa., - +. .+-. i- sa. ,-..- ...+..- .. .- ,.- ...-+ .- ..-.-. -. .. +:: +- . .+.- . ,,. .-..- . i. .+ -, +-- . . . -.. -,.+ +..- +-- i..+ . .,,,..- ..- .+ ...+..- .. .- ,++-- .-+ -. .- sa. ,.. ,-.. ,.-,- . .- . .-. .,,.-+ ,,-.. i- sa. .+-. ,., . ,.- - .-.- +- i..+ .+, .- ,.. ,-.. .-..- .+ .. ,.-,- .. .- sa. ,.+- ..+.- .-..- ., i. .+ -, +-- -.. +-- ..+. sa. ....- ..+,, .-. ++ ..-+, .+- .- , .+ . --, sa. .-..- -- ., . .,,... - ...- -, .-. .- +-- . . . .. -.. . .,., .--. .- .+...+, ++.- -..-+ ..+ .-- +. . ++., i..+ -- sa. ,.-,- .- sa. . .. . . - .,., aa -, .-+ +,-.. . .+. i- . ,... ,.-,- ....- .- +.-+ . . -- .,., -, .-, . ,.-+ +- .. .++ .-.- - -...-+ ++- s.-++- z s .- --, s+- .. -- .- -.-,- . . .+ +- .- ,.-+ +- --,. ..+ ..- ,-+ .- +- .++, --,. .- -,+--. . ..+ .. +.+-+ .+ ,.., ,.,-. -- . -. ..,.. ,. .--. .+ ,.,. -, . ,..- -- .- ,.. -, .+-., -- . -,, -, -,-. .+ .-... - .+....,-+ .- .. ,-..-+ , .- v., ..+ --,. ,. ++.- ..-, ,.-+ +- .- +- --,. ,. ++., -++.. ++., .. --.. ..-. +-+ .- +- --,. .,..- .- .. . ,-+ s s s .. ,-. -,-...-, .- z .+ s (-- -., +-,-+, .- - .-.-. +- + .- -,,-- -.-+-+ .. +., ., - ,..-+ . +-- ...-+ .-.. ,..- .- s . .++.. s ,-. +,-.. . +.- -,+--. e.+-+ ., - --,.-+ .. . ,-+ -,+. . .- ,-+ --,. .,..- .- .. --,. .. ,.,-. ,..- .+ -- +, . .- ,-. .- s., s.+. -.. s.+. s. -..+ i. x..+ .+ x. -.. .- z s.+. s,. s....+ -....+ s+,.+ , i, ,+...,. s..+ x. x., ...-,. . s+ s.,, .+ -+-. .- s i- -., ss ,..- .- s ,..- .- +-,..-+ . ..-.-. -. .- Laboratory accreditation i- s+-.+ ...., a+.., s..+.+ -.- . .- ... ...-+... .,-., . .-., -.. ,++.. .., .+ ... ...- ...+..- .. .sa.-. :azs s+. .-.... -.-., .- ...- . ,- ..., -..- .- ,+,- -.. ,++.. -,... .. .- -+ .+ e+, +... (-e, i- s+-.+ . .++.. ,.-., .-., .+ .-... .+..., .+ .., -..- . ... ...- Permits for Doing Business Factory establishment and operating licences i- -..., .. s- zsss (++z, .,+..- -,+.. ..., ..+.. .+ ,-.. ..., -,. .+ .-., -,+--. i- .. -.-+ , .- e-,..-. .++.. . .. .- v., .++., Editorial biotech 2 6/10/06, 11:03 27 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 28 A factory is defined as any premise, that uses machinery equivalent to 5 horsepower or more, or that employs 7 or more workers, with or without any machine, for manufacturing, producing, assembling, packing, repairing, maintaining, testing, improving, processing, conveying, storing or destroying anything included in the classes or types of factories presently listed in the ministerial regulations. A factory may include a laboratory while workers may include researchers. Under the Factory Act B.E. 2535 (1992), factories are separated into three groups according to the gravity of impact of the factory operations to the public or the environment, as follows: Group 1 - Factories that can operate immediately without prior government permission. Group 2 - Factories that require prior notification of the pertinent government authority before the business starts operations. Group 3 - Factories that require the application for a factory license before the establishment of the factory. The Factories Act also regulates the standards and procedures for control of waste, pollution and any activity that may harm the environment as a result of business operations, and necessary documentation and data which must be kept by factories to ensure compliance with the Act and its regulations. Violators of the Act are liable to fines ranging from $8,000 to $16,000 and/or prison sentences. An application to establish a factory must be submitted to the Ministry of Industry in Bangkok, or if the factory is outside Bangkok, it may be submitted to the provincial office. Full plans and details concerning the construction and proposed purpose of the factory must be submitted. Where required, an Environmental Impact Study must be submitted as well and approved before a Factory Establishment License may be granted. After the construction of the factory, the manufacturer must apply for a Factory Operating License. If on inspection it appears that the factory and its machinery conform to the Factory Establishment License, a Factory Operating License will be issued. Editorial biotech 2 6/10/06, 11:04 28 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 29 Before the construction of a factory classified under Group 3, the operator must obtain a factory license from the Department of Industrial Works, Ministry of Industry. Application for a license entails completing an official form, submitting drawings and particulars of the factory, machinery, and acceptable effluent treatment system, and attaching the documents stipulated on the form. The operator of a Group 3 factory must notify the competent authority at least 15 days before a factory test-run commences, and again 15 days before actual manufacturing operations start. The factory license is valid up to the last day of the fifth calendar year from the year of commencement and is renewable. An application for renewal of the factory license must be filed prior to the expiration of that license. Licensees must also obtain prior permission from the Ministry of Industry for any factory expansion, transfer of machinery to other sites, or transfer of factory site. Permission is likewise required in order to transfer, lease, assign, or sell a factory operation. Import and export controls There are regulations on the import and export of goods into and out of Thailand. Trade in certain items is restricted through outright prohibition, imposition of duties or licensing requirements.
Import controls The Ministry of Commerce designates classes of goods that are subject to import controls, which usually take the form of permission and licensing. Although these controls are being liberalized, at present more than 50 classes of goods require import licenses from the Ministry of Commerce. These categories are frequently changed through notifications from the ministry. A license to import any of the specified items must be secured from the Ministry of Commerce. In addition to the Act imposing the above controls, a number of goods are subject to import controls under other laws. With relevance to biotechnology, these include: The import of modern drugs requires prior licensing from the Food and Drug Administration under the Ministry of Health; The Minerals Act stipulates that without appropriate permission, an importer is prohibited from importing tungsten oxide and tin ores and metallic tin in quantities exceeding two kilograms; The Cosmetic Act stipulates that for the purpose of protection of public health, any importer of controlled cosmetics must provide the name and location of the office and the place of manufacture or storage of the cosmetics, the name category, or kind of cosmetics to be imported, and the major components of the cosmetics. Biotech hardware and chemicals and live specimens for research are regulated by the Thai Customs Department. The taxes for biotech hardware and chemicals are 5 % of the total cost whereas those for live specimens are 10 % of the total cost. Hazardous and exotic organisms are quarantined by the Department of Medical Sciences, Ministry of Public Health.
Export Controls The Act Controlling the Importation and Exportation of Goods authorizes the Ministry of Commerce to subject products to export control. At present, close to 50 items require such control. Certain goods require export licenses under other laws, such as seeds, trees, and leaves of tobacco. Import, export and possession of hazardous substances in Thailand The Act includes ten categories of hazardous chemicals as follows: Explosives Flammable substance Oxidizing agent and peroxide Toxic substance Substances causing diseases Radioactive substance Mutant causing substance Corrosive substance Irritating substance Other substance either chemicals or otherwise which may cause injury to the persons, animals, plants, property or environments. Editorial biotech 2 6/10/06, 11:04 29 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 30 Hazardous substances are classified into four groups: Category I hazardous chemicals for which the production, import, export must be in compliance with the principles and procedures promulgated. Category II hazardous chemicals for which the production, import, export or being in possession must be informed to the authorities. Category III hazardous chemicals for which the production, import, export or being in possession must be permitted. Category IV hazardous chemicals for which the production, import, export or their possession are legally forbidden. No registration is necessary for chemicals of category I while categories II and III need to be registered before manufacture and/or import. Importation, handling and disposal of radioactive materials The importation, handling and disposal of radioactive materials is strictly regulated under the Atomic Energy for Peace Act and radiation safety regulation. The Act and regulations are enforced by the Office of Atomic Energy for Peace of the Ministry of Science Technology and Environment as well as the Department of Medical Science at the Ministry of Public Health. The Office of Atomic Energy for Peace looks after the utilization of radioactive materials and other radiation sources, while the Department of Medical Science looks after X-ray machines. The Office of Atomic Energy for Peace is responsible for licensing the utilization of radiation sources other than X-ray machines. The responsibilities include authorization and inspection, waste management and the information exchange. Applications for importation, handling and disposal of radioactive materials shall be submitted to Office of Atomic Energy for Peace for approval according to sections 12 & 13 of the Atomic Energy for Peace Act B.E 2504. Environmental legislation The Enhancement and Conservat i on of Nat i onal Environmental Quality Act B.E. 2535 (A.D 1992) is the most significant environmental legislation. The Act continues and expands the responsi bi l i ti es of the Nati onal Environment Board (NEB) and created incentives for environmental promotion and preservation, prescribes penalties for polluters for the establishment of a fund for promotion and preservation of environment quality and gives the public a greater participation role in addressing environmental problems. The Act for the Cleanliness and Orderliness of the Country B.E. 2535 (A.D. 1992) regulates and controls offences to the environment deemed dangerous or unsightly. The Act specifically prohibits the dumping of waste and waste by-products into bodies of water. Minister notifications and regulations issued under the Factories Act B.E. 2512 (A.D. 1969) control the level of effluent discharged by factories and restrict concentration levels of chemical and/or metal pollutants to defined parameters. About the Author Rouse & Co International provides a full range of intellectual property services world-wide. We help manage patent portfolios and advise on strategies that will enable the full potential of the patents to be realized. Fabrice Mattei is a partner and has been working in Thailand in the fields of patent and biotechnology for the last 12 years. Editorial biotech 2 6/10/06, 11:04 30 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 31 Human Resources A key success factor for Thailand's biotech industry is the development and management of its biotech human resources. Many initiatives are now in place to grow the local talent pool. Thai professionals abroad are encouraged to return home to contribute towards the growth of the local biotech scene. Specifically, the National Science and Technology Development Agency (NSTDA) has initiated a "Reverse Brain Drain Project" to encourage Thai professionals with backgrounds in science, engineering or medicine to return to share their technical skills with their fellow countrymen. More information on the project can be found at the NSTDA's website at www.nstda.or.th/ rbd (note: the information is written in Thai). In addition, universities across the nation are beginning to offer more relevant courses and degrees in the areas of science and engineering. Both private companies and the Thai government are offering scholarships to increase accessibility of education in this exciting area. To succeed in Thailand, companies starting up should have a good understanding of the legal framework surrounding labour issues and an appreciation of Thailand's cultural perspective. There should also be a thorough planning process to address common HR issues such as salaries and benefits, employee relations, HR practices and termination concerns prior to initiation of operation. Some of the common employment laws and issues are detailed below: Labour Laws Designed to protect workers and preserve their rights, the following legislations govern labour issues in Thailand: Labour Protection Act Labour Relations Act The Act Establishing the Labour Court and Labour Court Procedure Provident Fund Act Social Security Act Workmen's Compensation Act Thai Civil and Commercial Code The Labour Protection Act underlines the minimum employment condition requirements for an employee in the private sector, including minimum and maximum working hours, holidays, minimum wages, child and woman labor, leaves (sick, maternity, military and business) and severance pay. The Labour Relations Act provides the guidelines for the establishment of unions and the negotiation of employment contracts. The minimum age of employment in Thailand is 15 years for standard jobs and 18 years for dangerous or hazardous jobs. Under the current labour laws, some of the benefits that all employees are entitled to include: 13 national holidays per year. 1 day off per week (usually Sunday). Minimum of 6 working days of annual paid vacation upon completion of 1 year of employment. Editorial biotech 3_4 6/10/06, 11:11 31 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 32 Up to 30 days of paid sick leave. 90 days of maternity leave. Pregnant employees are prohibited from working overtime, on holidays, or between 10 p.m. and 6 a.m. Maximum of 48 and 42 work hours a week for non-hazardous and hazardous works respectively. Paid overtime compensation for extra hours but limited to maximum of 36 hours a week. 1 hour of rest after every 5 consecutive hours of work or a total of 1 hour of rest per work day. Access to welfare facilities at the workplace, including medical and sanitary facilities. Severance pay entitlement for employees with minimum of 120 days of service. Pay amount is dependent on duration of service. Duration of service Severance pay amount 120 days to less than 1 year 30 days of wage 1 - 3 years 90 days of wage 3 - 6 years 6 months wage 6 - 10 years 8 months of wage > 10 years 10 months of wage There is an on-going effort to translate the various Acts of Parliament from Thai into English. Translated versions of some of these Acts can currently be found at the Thai Law Reform Commission (TLRC) website at www.lawreform.go.th or the website of the Office of the Council of State at www.krisdika.go.th. Guidelines on the criteria and rate of compensation benefits payment are stipulated in the Act. The general provisions are as follow: Category Range of Compensation Benefits Cash compensation 2,000 to 9,000 baht Medical expenses Up to 35,000 baht for normal case Up to 50,000 baht for serious injury Work rehabilitation expenses Up to 20,000 baht Funeral expenses Up to 100 times of minimum daily wage rate Workmen's Compensation Fund In accordance with the Workmen's Compensation Act, employers in Thailand are required to make annual contributions to the Workmen's Compensation Fund. The contribution rate varies from 0.2 1% of the employees' annual wages and is dependent on the categorized risk rating of the company and the companies prior work related accident record. This fund is used to provide compensation benefits to employees or their next-of-kins for injuries, illnesses or deaths resulted from work related accidents. Compensation benefits are categorized into 4 groups: Cash compensation Medical expenses Work rehabilitation expenses Funeral expenses More details on the Workmen's Compensation Fund and the various benefit entitlements may be found at the Social Security Office website at www.sso.go.th/eng/index_en.html. Minimum wages Different minimum wages are applicable to businesses located in the different provinces. The minimum wage per day (effective January 1, 2006) ranges from 140 Baht in the northern provinces of Phayao and Phrae to 184 Baht in the capital, Bangkok. Editorial biotech 3_4 6/10/06, 11:11 32 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 33 Social Security Fund The Social Security Act provides for the creation of the Social Security Fund, which provides benefits to the employee and his dependents for loss of work due to non-work related injury, illness, maternity, disability, death, or retirement. The fund is financed through monthly contributions by the employers and employees (including foreigners). Currently, each party contributes 4.5% of the employee's monthly wage to the fund, up to a monthly wage ceiling of 15,000 Baht. More details on the Social Security Fund and the various benefit entitlements may be found at the Social Security Office website at www.sso.go.th/ eng/index_en.html. Provident Fund Under the Labour Protection Act, employers with 10 or more employees, and their employees, are required to contribute to an employee welfare fund. This fund will be used for lump sum or periodical payments to workers who resign or are laid off. It also serves as compensation to the dependents of employees who died in service. Hiring Foreigners Foreigners may not work in a number of occupations, including the following, which are related to the biotechnology industry: Agriculture, animal husbandry, forestry, fisheries, except for work requiring special expertise, farm supervision or labour in fisheries especially marine fisheries Engineering in civil engineering concerning design and calculation systemization analysis, planning, testing, construction supervision or consulting services, excluding work requiring specialized techniques Work Permit A foreigner who intends to work in Thailand will need to first obtain a non-immigrant visa (usually business - category B) to enter the country. Such a visa will entitle the holder to stay in Thailand for a maximum period of 90 days. Non-immigrant visas may be obtained from a Royal Thai embassy or consulate by producing several documents, including an employment letter from a company registered in Thailand. More information on the visa application process may be found at the Thai Ministry of Foreign Affairs' website at www.mfa.go.th. With the aim of facilitating employment and immigration needs of foreign investors, the Thailand's Board of Investment established a One-Stop Service Center jointly with the Immigration Bureau and the Department of Employment. The Center is tasked to provide quick turnaround for visas and work permits applications and renewals, usually within 3 hours upon receipt of the complete and accurate documentations. In addition, the center handles other transactions such as the issuance of multiple re-entry stamps, changes in visa class and payment of fines. It should be noted that the services offered by the One Stop Service Center are only available to foreign investors, experts and executives who have met certain criteria. Investors are advised to contact the One Service Center for additional information to see if they qualify for the Center's services. The Center's contact info is as follow: One Stop Service Center for Visas and Work Permits Office of the Board of Investment 207 Glas Haus Building Ratchada, 3 rd floor, Ratchadapisek Road Din Daeng, Din Daeng, Bangkok 10400 Tel: 0-2693-9333-38 Fax: 0-2693-9352 E-mail: visawork@boi.go.th The following sections have been extracted from the website of the Board of Investment http://www.boi.go.th./english/how/labor_issues_and_ important_addresses.asp Legal Implications of Labour Management Thai labour laws provide for considerable freedom in managing labour. As in many countries, it is not legal to discriminate on the basis of age or sex. However, personnel ads in Thai newspapers show employers narrowly defining their needs: "The successful candidate will be male, under 35 years of age, not a member of a labour union, and at least 150 cm in height, etc." Editorial biotech 3_4 6/10/06, 11:11 33 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 34 Furthermore, the government does not interfere with a company's retrenchment policies when economic condi- tions necessitate cutbacks. There is no "first in, last out" requirement in Thailand. Similarly, Thai employers have the right to transfer employees to other work locations, provided the transfer is not ordered with the exclusive intent to create hardship for them. Refusal to transfer is legal cause for dismissal.
Employee records An employer with 10 or more regular employees is required to establish written rules and regulations in Thai governing work performance. The regulations must be displayed at the work premises within 15 days of the date from which the number of employees reached 10 or more. An employer with 10 or more regular employees is also required to maintain an employee register in Thai with documents pertaining to the payment of wages, overtime, holiday work etc. Tips on Recruiting and Developing Staff The ability of a company to attract and retain staff is enhanced by tailoring compensation packages to meet the needs of individual employees. Increasingly, factors such as work environment, organizational policies, relationships with superiors, and defined career path influence decisions whether to join or remain with a company. In a challenging living environment such as Bangkok, these "quality of life" factors are important. Organizing training programs to upgrade skills helps to motivate staff and demonstrates a company's commitment to its employees. Admission to such programs can be seen both as a reward for good performance and as part of the total compensation package.
Recruiting Technically-skilled Manpower There are two main English language daily newspapers which support advertisements, both in English and in Thai. Both the Bangkok Post and The Nation boast circulation figures of close to 60,000 copies per day, and their advertising rates are similar. In addition to these mass-market dailies, there is an English-language daily, the Business Day, which claims a daily circulation of approximately 10,000. Prospective employees can be reached through the print editions of these newspapers as well as online classified advertisements on their websites. The Department of Employment, Ministry of Labor and Social Welfare also has a website which list job fairs and employment opportunities. It is found at http://www.doe.go.th/ eng/index/html. Several domestic and international personnel recruitment firms operate in Bangkok. These companies also offer services such as advice on issues of organizational structure, labour relations, and the cultural implications of managing labour in Thailand. It is also recommended that companies develop contacts with educational institutes to identify and court potential candidates as early as possible. For companies with ongoing manpower needs, establishing a network of contacts can be especially valuable. Besides tailoring compensation packages to individual needs and emphasizing long-term and organizational benefits, companies need to give high-end technical employees, such scientists and engineers, work that are commensurate with their skills. Given greater challenges and expanded roles in areas like systems design and management, technical personnel can become more productive and are more likely to view themselves as an integral part of the company. Concrete, long-term benefits are an effective retention tool. Long-term benefits motivate personnel to work through problems and to identify self-interest with company interest. Committing resources to long-term benefits also ensures that companies are able to realize increased production levels from staff as they gain experience. Editorial biotech 3_4 6/10/06, 11:11 34 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 35 Withholding Tax Certain types of income paid to companies are subject to withholding tax at source. The withholding tax rates depend on the types of income and the tax status of the recipient. The following table shows some of the prevailing withholding tax rates: Types of income Withholding tax rate 1. Dividends 10 % 2. Interest 10 % if paid to associations or foundations 15 % in other case 3. Royalties 10 % if paid to associations or foundations 3 % in other case 4. Advertising Fees 2 % 5. Service and 3 % if paid to Thai company professional fees or foreign company having permanent branch in Thailand 5% if paid to foreign company not having permanent branch in Thailand 6. Prizes 5 % It should be noted that government agencies are required to withhold tax at the rate of 1% on all types of income paid to companies. The payer of income is required to file the return and submit the amount of tax withheld to the District Revenue Offices within seven days of the following month in which the payment is made. The tax withheld will be credited against final tax liability of the taxpayer. Details of tax regime can be found at the Thai Revenue Department website at www.rd.go.th. The website provides comprehensive coverage on tax matters and is a valuable online resource. Some of the more relevant sections are summarized below: Corporate Income Tax Generally, companies are taxed on net profit derived from business in Thailand at 30%. Various rate reductions are available depending on the category of the company. Personal Income Tax Foreigners are considered Thai tax residents if they spend 180 days or more in Thailand during the calendar or tax year. A tax resident is liable to pay tax on income from sources in Thailand on a cash basis, regardless of where the money is paid, as well as on the portion of income from foreign sources that is brought into Thailand. Tax rates for residents depend on their total taxable income during the calendar year and range from 0% to 37%. A non-resident is, however, subject to tax only on income from sources in Thailand. Value Added Tax (VAT) The Value Added Tax (VAT) was implemented in Thailand in 1992 as an indirect tax imposed on the value added of each stage of production and distribution. Any person or entity that regularly supplies goods or provides services in Thailand and has an annual turnover exceeding 1.2 million Baht is subject to the VAT. The current VAT is set at 7%. Editorial biotech 3_4 6/10/06, 11:11 35 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 37 An Overview of Bio-IP Legal Framework in Thailand In order to create a supportive infrastructure for biotechnology industry development, the Thai Government has been actively seeking to improve the laws governing the industry. In particular, it is upgrading laws to provide a more favourable environment for the protection and enforcement of intellectual property, a vital element for the growth of biotechnology. There are five forms of intellectual property protection relevant to the biotech industry, namely, patents, trade secrets, plant variety, trademarks and copyrights. However, the most used and relevant protection for the biotechnology industry is patent. Patents, utility models and designs 1
Patent for invention Having an appropriate patent portfolio helps attract investment and assures investors that when products and services are finally marketed, exclusivity will be assured to the company. A patent gives the patentee exclusive rights, empowering him/her to prevent another from using, making, selling or offering for sale, importing or exporting the invention claimed in a patent. The right is territorial and limited to the country where the patent is granted. Biotechnological inventions are generally protected through patents, which can include composition of matter claims for instance on isolated nucleotide or amino acid sequences. It is not permissible to claim methods of medical treatment of humans and animals, or methods of diagnosis in relation to humans or animals. However, a method for preventing a disease can be patented. The Patent Act does not allow for patents on plants and animals. Patents on micro-organisms are only granted if the organisms are modified. It further excludes patents on plant varieties, which are protected under the Plant Variety Protection. The law protects pharmaceutical products through patent. Methods for the production of transgenic animals, plants and micro organisms can also be patented as can the organisms themselves as long as a discernable new function or trait can be documented. For example, modified Bt gene, isolated strains, purified strains etc. What is the test for an invention to be capable of patent protection? Are there separate tests for biotechnology, medical device inventions? The answer is no, the test is uniform. In order to obtain a valid patent in Thailand, the subject invention must be novel (that is, not known) and inventive at the date of filing the patent application. A further requirement for a valid patent is that the invention must be capable of industrial application or be useful. 1 Patent Act B.E. 2522 as amended by the Patent Act (No.2) B.E 2535 and the Patent Act (No.3) B.E. 2542. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 38 The novelty requirement can be troublesome. The invention must not have existed somewhere (in or outside of Thailand) in the form in which it is claimed. In the context of biotechnology, the most obvious concern is the patentability of natural products, which, at first glance, appear to have pre-existed. However, if these materials can be claimed in a manner, which distinguishes them from their status as they occur in nature, there is no barrier to patentability in properly constructed claims. For instance, patents have been issued on DNA encoding erythropoietin, pure TPA, DNA encoding TPA, and so forth. The exclusive rights to the patentee are: in the case of product patent, the right to manufacture, use, sell, possess for sale, offer for sale or import the patented products; in the case of a process patent, the right to use the patented process, manufacture, use, sell, possess for sale, offer for sale or import the products which are manufactured by the patented process. The validity period of a patent is 20 years from the application date.
Petty patent or utility model Many technical creations involve a contribution of minor additions to existing technology and do not comply with the higher criteria of inventiveness required for a patent. Product and process qualify for utility model protection. Unlike patents for inventions, utility models are not required to meet the inventiveness requirement. Practically, it means that there is no need to prove prominent substantive features and notable progress to existing or prior technology. A product or process is eligible for registration as a utility model if it is new and has industrial applicability. The novelty requirement and industrial applicability are the same as for an invention. The period of protection for a utility model is six years from the application date, with a possibility of extension for up to four years.
Designs Design protects the shape or appearance of an object, composition of lines of colors giving a special appearance to a product. Design protection is particularly relevant to packaging, products shape etc. It must be new and capable of industrial application. The owner of a design has the same rights as the owner of a patent. The validity period of designs is 10 years from the registration date, not renewable. Trade secrets 2 A trade secret will comprise any information, which has commercial significance (valuable information in the commerce) as a result of its confidentiality. In the biotechnology area, compositions, tissue, experimentation results, clinical trials results, process know-how, confidential business idea, marketing plan etc may be protected by trade secrets. The ability of its holder to keep a secret is the ultimate requirement. The holder is not protected against discovery 2 Trade Secrets Act B.E. 2545 (2002). T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 39 of the trade secret because of inadequate schemes for ensuring secrecy. Thus, it is necessary to initiate and maintain institutional practices which may or may not be acceptable to affected parties, such as requiring employees to sign confidentiality agreements, requiring visitors to wear badges and be escorted, requiring exit interviews for employees leaving the company, requiring identification of what is and what is not under trade secret protection and other burdensome and rather ill-defined measures to assure confidentiality. Given the high level of skill in biotechnology and the efforts put in research and development, it is difficult to rely on trade secret protection to provide a market advantage although there are some rare and isolated cases proving the contrary. Plant Varieties Protection 3 The Plant Variety Protection Act 1999 (PVP) protects conservers of local plant varieties as well as owners of commercial plant varieties. Compensation has to be paid for the use of local plant varieties in the development of new commercialized varieties and when materials from local plant varieties are extracted to gain ingredients for medicinal or other products. There are other laws related to the protection of specific biological resources and in order to coordinate them, the Government has passed regulations on conservation and use of biological resources on January 17, 2000 (see below). There are four types of plant varieties protected under the PVP: New plant variety A new plant variety, for example one created through genetic modification, will only be granted protection if its biological safety is proven. If a new variety causes damage to community environment or community health, its owner, by law, is liable for compensation. The new varieties shall meet the following criteria in order to obtain registration: distinctive, uniformity and stability. For protection purposes, new varieties should not be commercialized in or outside of Thailand more than two months prior to the date of the application. The protection period varies according to the nature of the plant. For annual crops the protection is 12 years; for perennial crops 17 years; and for trees, 27 years. There are some exceptions to the exclusive rights granted to applicants of new plant variety for research and farmers uses. Indigenous varieties There are plant varieties developed by a community, which have never been registered as new varieties. The community has exclusive rights, after registration, and the access to those varieties needs approval and negotiation for the benefit of sharing with the community. The protection follows the Convention on Biological Diversity guidelines. Traditional local varieties Traditional local varieties are those originated in the country in which they are widely used by farmers. They are neither new, indigenous varieties, nor wild species. Wild plant species Wild species are those that are found in nature and have never been cultivated. Anyone who wants to make commercial use of these varieties or their plant parts should seek approval and negotiate fees and benefit sharing with the relevant authority. In addition to the Plant Variety Protection Act, there is the Thai Traditional Medicine and Local Knowledge Protection and Promotion Acts 4 that protect medicinal herbs, local medicinal preparations as well as traditional knowledge such as traditional medicine technology, diagnostic of illnesses and diseases. Efforts to conserve biodiversity are also restricted by government policies and other legislations such as the Forest Act B.E. 2484 amended, Wildlife Preservation and Protection Act B.E. 2503 amended, the National Park Act 3 The Plant Varieties Protection Act B.E. 2542 (1999). T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 40 B.E. 2507, the National Forest Reserve Act B.E. 2507, the Forest Plantation Act B.E. 2535, the Fishery Act B.E 2490 (1947) amended on 2528 (1985), the Plant Quarantine Act b.e 2507 (1964) amended on B.E. 2542 (1999) as well as the National Environment Quality Promotion and Conservation Act B.E 2535 (1992) and the Plant Reservation Act B.E 2542 (1999). Copyright 5 Copyright protects creative works such as literary works, computer programs, artistic work, musical work etc. No one can reproduce or adapt the work for commercial purposes without the priors authorization of the copyright holder. Unlike patent, copyright does not need to be registered. The protection occurs upon the creation of the work and its publication. However, it is possible to record it with the Depart ment of I nt el l ect ual Propert y f or of f i ci al acknowledgement. Copyright protection is less relevant for the biotechnology area. However, it may be used to protect the three dimensional structures of proteins, user manuals, drawings, diagrams, research report etc. Keeping good records of such work is therefore important to prove ownership. Software can be protected by copyright and this is particularly relevant to researchers and developers in the bioinformatics area. Trade and service marks 6 A mark is the brand name under which a product is sold or a service is offered. Although the right to a trademark is not relevant to the substantive protection of a biotechnology invention, it is an invaluable right in the commercialization of biotechnology inventions. When a product, process or service is well named, the trademark can be used to protect the market share. Thus a well thought out marketing program will require the careful selection of a trademark. The Department of Intellectual property is responsible for receiving and examining trademark applications. Assuming no complications, the Registrar normally grants registration within 8-10 months from the application date. A registered trademark is valid for 10 years and can be renewed for unlimited subsequent periods of 10 years. Registration of a trade or service mark in Thailand offers the two main benefits: Prevents others including competitors from registering identical or similar marks in the same or related class of goods or services; Entitles the trade mark owner to take civil, criminal or administrative actions in Thailand against counterfeiters Enforcing intellectual and industrial property rights The enforcement of intellectual and industrial property rights is under the exclusive jurisdiction of a specialized court: the 5 Copyright Act B.E. 2537 (1994). 6 Trade Mark Act B.E 2534 (1990) as amended by the Trade Mark Act (No.2) B.E 2543 (1999). T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 41 Central Intellectual Property and International Trade Court (CIPITC). The CIPITC and its special procedural measure to support the substantive laws on intellectual property have helped improve the enforcement of IPRs. An interesting feature of the CIPITC is the inclusion of associate judges in the quorum. Some of them have strong expertise and academic records in life science, biotechnology and pharmacy. A quorum of judges in each case is composed of two career judges and one associate judge who has the same voting power and authority over the case as a career judge. Associate judges help to guide the career judges through the technical aspects of some cases and they hold office for a term of five years. The proceedings in the CIPITC are speedier than the ones in the normal courts. The CIPITC may grant a preventive injunction which orders the prospective counterfeiter to stop or refrain from committing the infringement in the line with the provisions in the Copyright Act (section 65), Trade Mark Act (section 116) and Patent Act (section 77bis). IP Issues related to Biotechnology There are IP and IP-related legal issues that researchers in Thailand must be aware of. The most important ones are listed below: Inventorship, ownership and compensation It is a rare situation when only one person is involved in the matter from start to finish and can go to the patent office or his agent with a complete working invention and say this is all my own work. Real life situations are usually more complicated and the ownership of the rights in an invention or creative work is regulated by law and by contractual terms. Invention made in employment According to the Thai Patent Act 7 , employees invention is owned by the employer if the invention is made in the course of his employment. It is still important to include appropriate provisions in employment contracts dealing specifically with IP ownership. Employers generally require to own any inventions and developments devised by the employees during the course of their employment and require the employees to take any step required to transfer ownership and/or to assist the employer to protect and enforce its intellectual property rights. However, employee-inventors are entitled to compensation where the invention is assigned to the employer and the employer obtains benefits from the commercial exploitation of the invention (e.g. licensing, assignment of the invention etc.). Commissioned inventions Similarly commissioned or contracted inventions will be owned by the person commissioning the work, provided appropriate provisions are included in the commissioning agreement. The inventor shall always be named as such on the patent, whether or not he owns any rights in it. The inventor must be a real person and not a company or juristic person. Joint-inventorship and ownership It is not unusual for an invention to be co-invented. In that case, more than one person may jointly hold a patent or 7 See supra note 1. _ T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 42 even trade secret. Intellectual property rights can also be assigned to others. About the Author Rouse & Co International provides a full range of intellectual property services world-wide. We help manage patent portfolios and advise on strategies that will enable the full potential of the patents to be realized. Fabrice Mattei is a partner and has been working in Thailand in the fields of patent and biotechnology for the last 12 years. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 44 Regulating Bioprospecting in Thailand Thailand is a land rich in biodiversity. Out of 14 million species of living organisms in the world, it is home to 1.27 million species. Legal protection of biodiversity in Thailand has a long history. The country joined the international efforts to protect biodiversity when it acceded the Convention on Biological Diversity (CBD) on 12 June 1992 and later ratifying it on 31 October 2003. The Convention is the principal international treaty that governs bioprospecting (the processes of securing the right to search and acquiring rights to genetic resources). The CBD also establishes the principles for sharing the benefits that are obtained from the use of those resources, often referred to as Access and Benefit Sharing (ABS). The rules on bioprospecting are derived from the three primary goals of the pact: the conservation of biodiversity, sustainable use of the components of biodiversity and sharing the benefits arising from the commercial and other utilization of genetic resources in a fair and equitable way. Through the enactment of the CBD, transfer of genetic resources is increasingly being dealt through bilateral negotiation. Thailand has set up its own domestic laws by adopting the important CBD principle of ABS - access and benefit sharing-into its jurisdiction. The enactment of the Plant Variety Protection Law in B.E. 2542 (1999) marked the high point of the development of legal protection of plant genetic resources. The Act was introduced in Thailand in order to protect both new and existing varieties. Existing varieties include wild varieties 1 , local varieties 2 and traditional varieties 3 . In the case of local varieties, the law requires the registration of local plant species that are found traditionally in an area and local plant species of villages. The rights of reproduction, species modification, research, investigation, experimentation, production, sales and exportation belong to the registrar. And in order to pick, acquire or collect the subject plant species for species modification, research, experimentation and study, an agreement for benefit sharing is required (article 48). In the case of domestic general varieties and wild varieties, picking, acquisition and collection of parts of plants for improvement of the species, research, experimentation and study for commercial purposes will require permission of the Department of Agriculture as well as having a benefit sharing agreement in place (article 52). In cases other than commercial purposes, the rules stipulated by Plant Variety Protection Committee (article 53) must be followed. The Act on Protection and Promotion of Traditional Thai Medicinal Intelligence (enacted in B.E. 2542) can also be regarded as bioprospecting law since statutory subject matter includes herbs. The term herbs is defined as plants, animals, bacteria, minerals, extracts of plants or animals used, transformed, mixed or blended as drugs or food for diagnosis, therapy, treatment or prevention of diseases, or for promotion of the health of humans or animals. The definition also covers the origin or the areas in which the herbs exist. The Minister of Public Health has the power to introduce rules, procedures and conditions on certain activities involving controlled herbs. Without an official permission, certain uses of controlled herbs are illegal. The prohibited uses include commercial research, exportation, commercialization and processing. At present, a bioprospecting agreement is key in controlling the use of genetic resources. In the past, most bioprospecting arrangements involved foreign organizations paying Thai organizations to collect and send bioresources and sometimes to provide information such as location and 1 Wild varieties mean varieties that exist in a natural habitat but not widely cultivated. 2 Local varieties mean varieties indigenous to one particular community. 3 Domestic general varieties mean varieties widely available in the country, excluding new, wild and local varieties. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 45 application. Based on the information, foreign companies had studied, developed and commercialized products. In recent years, the concept of bioprospecting collaboration has changed. The concept of provider and taker has made way for one of equal partnership. Both parties are encouraged to jointly plan and conduct collaborative projects. Benefit sharing is also calculated on a fair and equitable basis which helps to create long term partnerships. Having witnessed several incidents of biopiracy, many Thai organizations have taken great care in managing their biological resources. For instance, the National Center for Genetic Engineering and Biotechnology (BIOTEC) realizes that biotechnological research and development is directly associated with both domestic and foreign biological resources. It is aware of the rules and regulations on access to biological resources as well as the need to prevent biopiracy. As a result, the Center has introduced its Guideline on the Movement of Biological Material. The Guideline aims to prevent biopiracy of Thai biological resources held at BIOTEC. Any acquisition of biological resources by BIOTEC staff must comply with all applicable laws. The deposit of biological resources in BIOTEC must be accompanied by Material Acquisition Agreements (MAA) while the transfer of materials to other organizations is controlled by Material Transfer Agreements (MTA). These two important legal documents have been widely used in many research organizations. Reference 1. Handa, S.S., a paper presented at Consultative Meeting of BIMST Countries on Biodiversity Conservation & Sustainable Industrial Utilization of Medicinal Plants, 20-22 May 2002, Bangkok, Thailand. 2. Svarstad, H. and Dhillion, S.S. (eds.) Responding to Bioprospecting: From Biodiversity in the South to Medicines in the North, Spartacus Forlag, Oslo, 2000. This article is contributed by Dr. Tanit Changthavorn of the National Center for Genetic Engineering and Biotechnology (BIOTEC) T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 47 Investment Promotion in Biotechnology Biotechnology is very important to Thailand which aims to become the supermarket of Asia and a hub for healthcare services in the region. Therefore, the Board of Investment gives high priority to this sector and encourages foreign investment into this sector without any restriction on foreign shareholding. In addition to non-tax incentives such as granting permission for land ownership and facilitating the application of visa and work permits, the Board of Investment also offers the following investment incentives: Biotechnology R&D A project eligible for investment promotion under Category 7.12 Research and Development is offered exemption of import duty on equipment and 8-year corporate income tax exemption. Biotechnology Laboratories A project eligible for investment promotion under Category 7.13 Scientific Laboratory or Category 1.22 Inspection and Analysis of Diseases of Crops, Livestock, or Aquatic Animals or both is offered exemption of import duty on equipment and 8-year corporate income tax exemption. Pharmaceutical A project eligible for investment promotion under Category 6.8 Pharmaceutical and Active Ingredient is offered exemption on import duty on equipment. For corporate T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 48 income tax, if the project is located in Zone 1, it will receive 5-year tax holiday. If it is located in Zone 2 and outside of an industry estate, it will receive 6-year tax holiday. On the other hand, if it is located within an industry estate, it will receive 7-year tax holiday. Finally, if the project is located in Zone 3, it will receive 8-year tax holiday. However, the amount of corporate tax exemption shall not to be more than the investment amount excluding the cost of land and working capital. Bioenergy A project eligible for investment promotion under Category 1.26 Manufacturing of Alcohol or Fuel from Agricultural Products is offered exemption of import duty on equipment and 8-year of corporate income tax exemption. Grading, Packaging & Storage A project eligible for investment promotion under Category 1.13 Grading, Packaging, and Storage of Plants, Vegetables, Fruits, or Flowers, Using Modern Technology is offered exemption of import duty on equipment and 8-year corporate income tax exemption. The amount of corporate tax exemption shall not to be more than the investment amount excluding the cost of land and working capital. Food and Beverage A project eligible for investment promotion under Category 1.11 Manufacturing or Preservation of Food or Food Ingredients, Using Modern Technology is offered exemption of import duty on equipment and 8-year of corporate income tax exemption. The amount of corporate tax exemption shall not to be more than the investment amount excluding the cost of land and working capital. However, if the project produces ready-to-eat or semi-ready-to-eat food, there will be no restriction on utilization of the 8-year corporate income tax exemption. Chemical A project is eligible for investment promotion under Category 6.1 Manufacturing of Basic Chemical or Category 6.2 Manufacturing of Other Chemical or both will be offered the following tax privileges: Project in Zone 1 will receive 50% reduction on import duty on equipment if it is located outside an industrial estate and both 50% reduction on import duty on equipment and 3-year corporate income tax exemption if it is located inside an industrial estate. Project in Zone 2 will receive 50% reduction on import duty on equipment and 3-year corporate income tax exemption if it is located outside an industrial estate and exemption on import duty on equipment and 7-year corporate income tax exemption if it is located inside an industrial estate. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 49 Project in Zone 3 will receive exemption on import duty on equipment and 8-year tax holiday. The amount of corporate tax exemption shall not to be more than the investment amount excluding the cost of land and working capital. Hospital A project eligible for investment promotion under Category 7.11.1 Hospital is offered the following tax privileges: Project in Zone 1 will receive 50% reduction on import duty on equipment if it is located outside an industrial estate and both 50% reduction on import duty on equipment and 3-year corporate income tax exemption if it is located inside an industrial estate. Project in Zone 2 will receive 50% reduction on import duty on equipment and 3-year corporate income tax exemption if it is located outside an industrial estate and exemption on import duty on equipment and 7-year corporate income tax exemption if it is located inside an industrial estate. Project in Zone 3 will receive exemption on import duty on equipment and 8-year tax holiday. The amount of corporate tax exemption shall not to be more than the investment amount excluding the cost of land and working capital. Investment Promotion The following are a number of recent projects approved by the Board of Investment: This article is contributed by the Thailand Board of Investment (BOI) T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 50 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 51 Conducting Clinical Trials in Thailand Investment in the life science and biotechnology sectors is often high risk, particularly as innovations have long gestation periods before a viable end use or product may emerge. In light of this, investments need to be securely protected within a robust intellectual property (IP) system. Such an IP system should be fully integrated with research activities and should be accepted by all involved as a necessary main component for any country that wishes to compete in the biotechnology arena. At the forefront of Thailands efforts to promote biotechnology is the Thailand Center for Excellence in Life Sciences (TCELS). This organisation has taken up the challenge of attracting high level investment to Thailands life science institutes and centers particularly in the field of bio-pharmaceutical products. TCELS is in the process of attracting high value (in terms of revenue and knowledge generation) pre-clinical testing and clinical trial activities using Thai facilities and scientists. These activities are in line with the first key milestone of the National Biotechnology Policy Framework i.e. Thailand to become a main center for clinical testing in Southeast Asia before 2007. In the last decade, Thailand has already seen a large number of clinical trials of new drugs being carried out at hospitals, medical centers and research institutes nationwide. The Ministry of Public Health (MoPH) has also made considerable efforts in the past few years to persuade international pharmaceutical companies to conduct clinical trials for newly developed drugs in Thailand. From a regulatory standpoint, the process of approving clinical trials has not yet been centralised in this country. Whilst drug regulation is centered at the Thai Food and Drug Administration, one of the departments under the Ministry of Public Health (FDA), this organisation does not directly monitor, and is not directly responsible for regulating, clinical trials of drugs in humans. Nevertheless the FDA does play an indirect role. In addition, the Department of Medical Services and the Department of Communicable Diseases Control, both within the MoPH have jurisdiction. The Ethical Review Committee for Research in Human Subject of the MoPH (ERC) plays a central role. The FDAs primary jurisdiction to control the import of drugs into the country for research purposes is frequently used to indirectly bestow the FDA with the authority (or responsibility) to regulate clinical trials of drugs in humans. To launch a clinical trial in Thailand, a drug developer/ sponsor must first select a research facility and a team of physicians to conduct the study. In most cases, hospitals and university medical centers are more apt to locate and retain suitable participants for clinical trials than other research institutes due to their ready access to a broad range of patients and research volunteers. Therefore, most clinical trials in Thailand are being carried out at these establishments. As required by law, a drug developer/sponsor needs to obtain approval from an ethics committee overseeing human research projects undertaken in an implementing institution prior to launching a clinical trial. Approval must also be obtained from the ERC and also from the ethics committee of the research institute or university that will conduct the trial. A protocol for conducting the clinical trial must also be established and approved at the outset before T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 52 approval can be obtained. The proposed protocol is sent to the Department of Medical Services within the MoPH for review and consultation. As for the ethics committees standard for review, although there is no national standard, most ethics committees follow the International Conference on Harmonisation (ICH) Good Clinical Practice (GCP) guidelines for clinical trials, promulgated by the World Health Organisation (WHO). In general, a clinical trial proposal submitted to an ethics committee would have to include the following information. Background information of the proposed study Objectives of the study Justifications and expected benefits from the proposed study Location and duration of the study Characteristics and the number of participants in the clinical trial (with the details of sex, age, disease or specific symptoms, etc.) Inclusion and exclusion criteria Discontinuation criteria Discontinuation criteria for participants Criteria for termination of the study. Implementation and monitoring procedures, including data collection and analysis. Ethical considerations, including Possible risks and preventive measures Compensation, medical care and other services to be provided to participants who may experience complications Information sheet and consent form for participants Budget and source of funding Typically, the review process takes approximately 2-3 months (from date of submission to final decision). Once a drug developer/sponsor receives an approval from the ethics committee to conduct a study in humans, he may proceed to request a licence from the FDA to import drugs into Thailand for research purposes (in relation to the FDAs licensing role of medicines, see below). Apart from an official approval from an authorised (or FDA approved) ethics committee, supporting documents to be submitted with an application for licence to import drugs into Thailand for research purposes include details of the drugs to be imported, (pre)clinical trial report, a complete clinical trial protocol, estimated amount of drugs required, and a power of attorney. The application must be submitted to the Drug Control Division of the FDA. It should also be noted that this special import licence is valid for one year only, regardless of the term of the ethics committees approval. Therefore, if a clinical trial is not complete within a year, a new import licence must be obtained. At the moment, the MoPH is in the process of drafting new legislation pertaining to government regulations of clinical trials and national guidelines for research projects involving humans. Details of the new legislation have not been disclosed to the public. Nevertheless, it will likely cover the establishment of a national ethics committee on human research and its guidelines, rights of participants in a research project and details of a contract that has to be signed before a material transfer can take place. Although the changes are on the way, it is difficult to predict when the new legislation, regulations and/or national guidelines will be implemented. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 53 Marketing Approval for New Drugs Outside of the conduct of clinical trials, the Thai pharmaceutical control system is divided into a pre-marketing and post-marketing phase. In the pre-marketing phase, companies must obtain a licence to produce, sell or import any pharmaceuticals into Thailand, as well as register their product for actual sales. The FDA is the main agency in charge of drug approval, registration and regulation. The system of regulation is derived from the Drug Act B.E. 2510 (1967) together with its four amendments, ministerial regulations and ministerial notifications. The fundamental basis of Thai drug regulation is that all activities in relation to the trading (i.e. importing, sales, production) of modern medicines must be licensed by the FDA, and such licensees must be Thai legal entities as set out in Section 12 of the Drug Act, which reads: No person shall produce or sell a modern drug or import or order a modern drug into the Kingdom, unless he has obtained a licence from the licensing authority. The application for a grant of a licence shall be in accordance with the rules, procedures and conditions prescribed in the Ministerial Regulations. In practice, the main types of licences available are: A licence to produce modern drugs; A licence to sell modern drugs; A licence for modern drug wholesale; A licence to sell only ready-packed modern drugs which are not dangerous or specially-controlled drugs A licence to sell only ready-packed modern drugs for veterinary use; A licence to import or order drugs into Thailand. It should be noted that the legislation uses the rather ambiguous term modern drug. Nevertheless, this term is defined to include drugs which are intended for use in the practice of modern medicine, and will clearly cover small-molecule and large-molecule drugs (such as biologics), as opposed to herbal medicinal products and traditional drugs. The procedure for seeking approval for a modern drug will in turn depend on whether the applicant is the drug originator, or a generic producer. Drug originators face the most onerous task as each element of drug safety, efficacy and effectiveness must be demonstrated to the satisfaction of the Drug Control Division of the FDA. In practice, there are three core stages that must be followed in seeking marketing approval for a new modern drug. New modern drugs include new chemical entities, new indications, new combinations and new routes of administration. With biologics, the procedure to be followed for approval is identical to the procedure discussed below, in respect of new drugs and generic drugs. The main steps for new drug (including biologics) approval are as follows: Step One: Obtain Manufacture or Import Licence for a Drug Sample This first step involves the making of a formal application to the Drug Control Division of the FDA to obtain a licence to import a sample of the drug for which marketing approval is sought. Alternatively, an application can be made to obtain approval to locally manufacture the drug sample. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 54 At present, Thailand does not have any real active pharmaceutical ingredient (API) production facilities. A significant proportion of manufacturing in the country takes the form of drug formulation. In light of this, applications to obtain import licences tend to be more common. Step Two: Submit Application for Marketing Approval Once the licence has been obtained to either import or locally produce a sample of the new drug, a full marketing approval application must be compiled to accompany the samples of the new drug. The application is also submitted to the Drug Control Division. This stage corresponds with the NDA procedure before the US FDA and requires the applicant to submit a complete dossier demonstrating the efficacy, safety and quality of the new drug. The data and documents to be submitted include: Relevant application form The proposed labels and leaflets (such as product inserts) Human and animal pharmacological study data (pharmacokinetics, pharmacodynamics) and animal toxicology studies Data generated from the safety and efficacy studies including clinical trial result dossiers Full chemical (or biological) details of the new drug, in addition to pharmaceutical data Where the drug is to be imported, a certificate of free sales from the country of origin Where the drug is to be manufactured locally, a certificate of raw materials for local manufactured drugs Updated status on the approval of the drug in other countries. It is common for the review process to last at least 12 months. At any time the drug originator may receive questions. Whilst clinical trials need not be conducted in Thailand for the purpose of supporting a new drug application, the FDA does have discretion to require a local study. Since 1994 the Thai government has recommended that production of pharmaceutical products take place according to Good Manufacturing Practice (GMP). The MoPH now mandate all public hospitals to ensure that drugs being purchased are produced in accordance with GMP. Safety Monitoring Period Once the review of the new modern drug (biologic) has been passed by the FDA, full unconditional approval is still not available until the drug has passed through a Safety Monitoring Period (SMP). Under this system, the newly approved drug may only be sold in medical institutes (such as government or private hospitals) under close medical supervision. These limited circulation rights exist for a minimum of two years but may be extended up to a total of four years. The purpose of this SMP is to enable distribution of the drug in the Thai market under conditions that would enable the drug to be closely monitored and to compile safety data, eventually leading to the grant of unconditional marketing approval for the drug. When a drug remains in the SMP, no generic version of the drug may be registered nor can any bioequivalency tests be conducted by any generic drug manufacturer. The SMP effectively secures exclusivity for a drug manufacturer T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 55 _ for as long as the drug remains in the SMP, indirectly providing the ability to exclude competitors from the market in a manner similar to a situation had a Thai patent been granted for that drug. However, a severe draw-back of the SMP system is that a drug may not be listed in the National List of Essential Drugs (NLED) if it is in the SMP stage. This effectively curtails the market for the new drug which in turn may cause difficulties in the collection of sufficient post-marketing safety data to have the drug removed from the SMP. Approval of Generic Drugs Generic drugs on the Thai market have accounted for a significant proportion of overall drug sales. This trend is likely to continue in light of the governments health care policy which seeks to make affordable medicine available to all. While drug originators have traditionally faced generic competition with respect to the more conventional types of small molecule modern drugs, generic competition is now increasing in the field of biologics. As is the case in many countries, an abbreviated form of approval exists in Thailand for generic versions of drugs that have already obtained marketing approval in Thailand. In essence there are two types of generic drug approval, depending on whether a reference originator has already been approved in Thailand, or if the generic is an entirely new non-patented drug on the Thai market. In such a case a protocol on the local conduct of bioequivalence studies must be submitted and approved. The common element in both forms of generic approval is that the applicant need only submit bioequivalence data as opposed to conducting rigorous trials and tests to prove safety and efficacy of the chemical entity or biological molecule. In other words, the Thai FDA does not require the generic applicant to reproduce clinical trials or pre-clinical tests. The primary steps involved in generic approval are as follows Step One: Obtain Manufacture or Import Licence for a Drug Sample Similar to the first step to be followed by new drug originators, this stage involves the formal application to the FDA for a licence to import a sample of the drug/biologic for which marketing approval is sought. Alternatively, an application can be made to obtain approval to locally manufacture the sample. Step Two: Obtain drug quality and analytical control method approval Various details as to the drug production process to be used in producing the generic are submitted as part of the application process. Most of these details concern the demonstration of quality of the drug. Amongst the details are manufacturi ng methods, i n-process control s, specifications of the active ingredients and excipients. Information as to the storage conditions of the drug and details as to the stability of the drug are also required. Step Three: Submission of Generic Product Registration Request The final stage involves submission of a formal application for a drug registration certificate. This directly corresponds to the NDA procedure before the US FDA in that this stage requires the filing of a full dossier in support of the application. It is possible to obtain generic approval within six month from the submission of the documents in step three. However, in practice, it can take up to another extra six months to conduct the requisite bioequivalence studies. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 56 Relationship between RegulatorySystem and IP Laws Thailands clinical trial system and drug regulatory system operate independent of the IP system. Whilst the separation of drug regulation and IP is common in many countries, there is a tendency for healthcare authorities to consult with IP regulators to avoid potential conflicts in practices. Other countries, such as Hong Kong and Singapore, have also sought to enshrine legislative safeguards. In Thailand, there is still a weakness in communication between the Department of Intellectual Property (responsible for granting and maintaining patents) and the FDA. This may affect the attractiveness of Thailand as a destination for the development and launch of new products because drug originators fear that generic competition may be facilitated at an earlier than expected stage in a new drugs product life cycle. An overview of the some of the main IP issues intersecting the regulatory system is as follows: Patents, Relevance & Weaknesses Thailands Patent Act became 25 years old in 2004. Despite its age, patent law is still regarded as a relatively new area within the Kingdom, especially when compared to many developed nations where extensive patent laws have existed for many decades. Early proposals for a patent system in Thailand, dating as far back as 1913, met with little success. After a 1964 Supreme Court judgment directed that patents were not recognised as legal rights, the need for patent law became more pronounced. But it was not until September 1979 that the Patent Act B.E. 2522 (1979) was finally enacted. This legislation remains the core patent law in Thailand today despite having undergone two substantial amendments in 1992 and in 1999. Thailands patent laws were crafted in a manner that was thought to complement the technological progress development strategy of the Kingdom. As part of the strategy, the original section 9 of the Patent Act contained a clear prohibition against the patenting of foods, beverages, pharmaceuticals or pharmaceutical ingredients. In effect, it ruled out the possibility of obtaining a patent for new pharmaceutical products (including biologics). The exclusion was much in line with the patent law of many developing countries in the pre-WTO/TRIPS era. It was argued that by excluding pharmaceutical products from being patentable, growth in the domestic pharmaceutical industries would result. Domestic drug companies would be permitted to legally copy drugs protected in developed markets, thereby enabling the domestic industry to develop and grow exports. With increased exports, income and profits could be generated and eventually find their way to fund research activities, thereby promoting technological development. On the other hand, manufacturi ng processes for pharmaceutical products were patentable. This enabled new processes for producing, maintaining or improving the quality of a pharmaceutical product to be protected. However, this protection was regarded as weak as non-infringing work-around to manufacturing processes could be developed. As a result of the perceived weakness of process patent protection for the pharmaceutical products, many pharmaceutical industry groups pressed for reform of the patent system in Thailand to extend protection to pharmaceutical patents. In 1992 amendments to the Patent Act finally enabled pharmaceutical products to be patented in Thailand for the first time. Furthermore, the amendments also extended the protection for patents from 15 to 20 years. Pipeline Protection One of the weaknesses of the 1992 amendments was that the ability to obtain patents for drug products was not applied retroactively to products already on the market i n overseas j uri sdi cti ons. Patent appl i cati ons for pharmaceutical products that were current in overseas jurisdictions at the date of the amendments to the Patent Act could be extended to Thailand provided that the application was filed within 12 months of the priority date. For other applications or patents in other countries, no protection existed. As a consequence, in October 1993, a form of pipeline protection for pharmaceutical products was introduced. The compromise that was reached was not an amendment to the Patent Act but the introduction of administrative rules to be applied by the FDA in the T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 57 approval of new drug products for sale on the Thai market. In effect, the rules enabled proprietors of drugs patented abroad between 1986 and 1991 (and for which the patent was still in force), but never distributed in Thailand to obtain, in effect, a form of limited marketing exclusivity for their drugs for the Thai market by using the SMP system as outlined earlier. Bolar Provisions & Generic Competition The exclusive patent rights of the drug innovator should, in theory, enable him to prevent third parties from conducting any activities in relation to the patented drug with a view to obtaining marketing approval from the FDA while the drug is still under patent. To this end the patent rights of the drug innovator should also permit restriction of third partys preparatory activities such as the development or import of the generic drug for the conduct of pre-clinical tests, and the conduct of the clinical trials itself. However, Section 36 of the Patent Act contains a number of broad exceptions to patent infringement including (4) Any act connected with an application for drug registration wherein the applicant has the objective of producing, selling or importing the patented medical products after the expiry of the patent This exception, which has come to be known as a Bolar Provision effectively enables generic drug developers in Thailand to develop, import and conduct clinical trials and other activities for the purpose of registering a generic version of patented drug with the FDA while the original drug is still under patent. Patent Linking At present the FDA does not have a legal obligation to determine whether a particular drug formula or active ingredient is under patent in Thailand when deciding on whether to grant marketing approval for a generic drug. In effect, the FDA is free to examine and grant marketing approval for a generic version of a drug even while the reference drug is under patent protection in Thailand. Pharmaceutical innovators are concerned that the freedom with which the FDA can grant marketing approval while a drug is under patent protection can accelerate the process by which a generic drug can enter the market and compete with the branded drug. If the FDA is required to ensure that all generic drug marketing approval applicants are off-patent, the drug originator will then have a longer period of time after the patent expires to recoup investment costs for the development of the drug. Patent linking is widely regarded as a modern necessity and is firmly enshrined in the laws of some prominent biotechnology players including the US, EU countries, Australia, Singapore and Hong Kong. Patent Term Restoration The term of protection for a patent owner in Thailand is 20 years from the earliest application date, with no possibility for an extension. Patent applications must be pursued directly in Thailand as the country is still not a member of the Patent Cooperation Treaty. Thailand is also a full examining country, meaning that full substantive examination of all patent applications must be conducted before a patent can be approved. Due to resource limitations, the Department of Intellectual Property outsources much of the examination work to the Australia patent office. In the event that an unreasonable delay occurs in the granting of a patent (i.e. a delay often in excess of four years) or in the approval of a drug (i.e. a delay frequently in excess of two years), the effective patent life may be dramatically curtailed and hence severely impede a drug developer from using the patent to recoup costs of development. To encourage drug developers to continue developing new medicines and to discourage patent offices and drug regulators from incurring unreasonable delays, many countries operate a system of patent term restoration which provides patent owner with a limited extension (often capped at between 3 and 5 years) of the patent term, to T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 58 compensate for such avoidable delays. Unfortunately, this is still unavailable in Thailand. Protecting Pre-Clinical & Clinical Trial Data The extent to which a generic applicant can rely on test data on file with the FDA has also proved to be a thorny issue. In practice many countries recognise the extreme cost of developing such data and hence confer a limited period of protection to drug originators. These laws often confer exclusivity rights on the drug inventor in relation to the clinical test data it has submitted, effectively excluding generic manufacturers from relying on the data for a limited time. The requirement to protect such test data is also firmly enshrined in the TRIPS Agreement, although the parameters of this right are not clear. In the EU, data protection/exclusivity periods of up to ten years exist, while in the US the exclusivity period can be up to 5 years. Recently the Thai Government enacted the Trade Secrets Act 2002 (BE 2545). This legislation creates a legal framework for the protection of trade secrets and other confidential information, rendering the unauthorised use and disclosure of such information an actionable offence punishable by civil and criminal remedies. Section 15 of the legislation specifically addresses the issue of data exclusivity in respect of data submitted to the FDA for drug approval purposes. The Act recognises that such information may amount to a trade secret and that the trade secret owner would have the right to request the FDA to maintain the confidentiality of the information. Upon such request, the FDA would have a duty to maintain the trade secret from being disclosed, deprived of or used in unfair trading activities, in accordance with the regulations prescribed by the Minister. Future Directions The potential for a free trade agreement (FTA) between Thailand and the United States (TUSFTA) has long been in the offing. But it was not until February 12, 2005 that initial formalities were completed when US Trade Representatives notified the US Congress of their intention to commence negotiations with the Thai Government. TUSFTA is welcomed by many businesses and industries as it will ensure the attractiveness of Thai products in the US market. It is also widely expected that a key chapter of the pact will contain a number of obligations on Thailand to modernise its intellectual property regime in line with international trends and in compliance with Thailands original obligations arising from accession to the TRIPs Agreement. In essence, TUSFTA will present an ideal opportunity for Thailand to enhance the attractiveness of the country through the strengthening of its laws and procedures, making it a safe and secure destination for foreign direct investment, particularly in the biotechnology and pharmaceutical fields (in addition to other areas such IT, automotives and agriculture). Thailand is capable of becoming a major player in the regional biotechnology sector. In addition to a strengthening of drug regulation in line with international best practices and procedures, Thailand must firmly recognise the need for and role played by IP. About the Authors Edward Madden (emadden@tillekeandgibbins.com) is director within the Intellectual Property Department of Thailands oldest law firm Tilleke and Gibbins. He acts on behalf of a number of leading pharmaceutical companies such as Merck & Co, GSK and Schering Plough and is part of the advisory team to PReMA. Siraprapha Rungry (siraprapha@tillekeandgibbins.com) is a legal consultant within the Intellectual Property Department of Tilleke and Gibbins and is separately assisting the National Innovation Agency with respect to innovation promotion and IP commercialisation. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 59 Biosafety Regulation Thailand is currently not trading in genetically modified plants, except for research purposes. It acceded the Cartagena Protocol on 10 November 2005 which was entered into force on 8 February 2006. The treaty required Thailand to put in place a legislative framework for the entire country so that it can fully participate in this multilateral approach to managing the potential risks of LMOs. Such a framework would define how Thailand can regulate and promote modern biotechnology at a faster pace than before. The country has made good progress as the drafting Committee has already approved the draft Biosafety Act (issued on 29 June 2006) which is currently under public consultation and consisting of 103 Articles in 10 sections. In addition, the Office of Natural Resources and Environmental Policy and Planning has been nominated as the National Focal Point for the Protocol and Biosafety Clearing House (see more detail in http://bch-thai.onep.go.th/ index_en.html). Biosafety Guidelines for Research and Development Thailands current regulatory system does not specifically prohibit or control any research, development and production of GM crops developed domestically. The Biosafety T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 60 Guidelines for Work Related to Modern Biotechnology or Geneti c Engi neeri ng (for more i nformati on vi si t http://biosafety.biotec.or.th/?sw=topicview&id=637), a non-binding set of rules proposed and used by BIOTEC since 1992 was the first set of guidelines in biosafety that researchers and developers (including plant breeders who involve in genetic engineering) in the country were encouraged to follow. To effectively implement those guidelines, the Central Biosafety Committee (CBC) was established. Subsequently, sub-committees for specific areas such as for plants, food and micro-organisms were also set up. The committees act as technical supervisor on biosafety for the Institutional Biosafety Committees (IBC) which have been encouraged to be set up at various research institutes as well as for the Competent National Authorities such as Department of Agriculture and Food and Drug Administration. The figure 1 below shows the process, for example, for research project approval by the IBC for type 1 and type 2 research project categories. Only type 3 category projects which may cause harmful effects to researchers, communities and environment will be approved or be recommended by the CBC. Funding agencies will not grant the research project unless the approval letter from IBC/ CBC is attached. Figure 1. Research project approval process Biosafety-related Legislation Thailand currently has no specific laws on biosafety. But the Ministry of Natural Resource and Environment (MNRE) is developing a bill for biosafety law which is expected to be finalized soon. In its absence, some related acts are applied as follows: 1) Plant Quarantine Act B.E. 2507 (1964) The notifications under this act are promulgated to cover aspects of LMOs issues that are not clearly stated in this act. Eighty nine species of LMOs are prohibited to be imported into and transported across the Kingdom, except for research and development granted by the Director- General of the Department of Agriculture in compliance with guidelines on import and transit of prohibited materials. 2) Plant Variety Protection B.E. 2542 (1999) New plant species and the holder of the plant variety right are protectable under this act. Living modified plants capable of registration shall be assessed for potential risks 3) Food Act B.E. 2522 (1979) According to this Act, the Minister shall be empowered to promulgate notifications for controlling food by reference to the class and kind of food produced for sale, import for sale, or sale including condition and methods of labeling, principle and methods of advertising on the label. Information on biosafety-related legislation can be found at http://bch-thai.onep.go.th/law_list_e.html Regulation on GM Plant/Seed in Plants In accordance with the Plant Quarantine Act B.E. 2507 (1964) 1964 as amended in 1999, importation of GMOs into Thailand as a plant is prohibited. To comply with the Plant Quarantine Law concerning transgenic plants as the prohibited materials, the MOAC has issued many rules and measure, as follows: 1) Ministerial Notification T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 61 MOAC issued The Ministerial Notification B.E. 2543 (2000) under the Plant Quarantine Act B.E. 2507 amended by Plant Quarantine (No.2) B.E. 2542 specified 89 GM-plant species as prohibited materials for importation unless for experiment and research purposes that requires the import permit issued by DOA. However, soybean and corn grains are exempted from the ministerial notification in light of food, feed and industrial utilization. 2) DOA Notification DOA has issued 3 notifications, firstly is an application guideline for the importation of prohibited transgenic plants; secondly, is to certify crop production in Thailand as Non-GMOs (list of 159 plants), and thirdly is to certify that imported plant propagated materials are not derived from genetic modification. More details on the application guidelines are as followed: Procedures for Importation of Transgenic Plants. Application of imported transgenic plants into the Kingdom has to be submitted to the Director of Agricultural Regulatory Division (ARD). The plant quarantine authority will review and check all the necessary documents in accordance with ministerial and DOA notifications. Furthermore, the Director of ARD will submit the application accompanied with information and technical documents to the DOA Biosafety Committee for consideration. The Committee shall appoint four to five committee members to evaluate and examine all technical information and make recommendation to the Committee. Finally, the Director General (DG) of DOA on the advice and recommendation of the Biosafety Committee will make a decision whether to approve or reject the application. Approval of Transgenic Plants. In accordance with the Plant Quarantine Act B.E. 2507 (1964) amended (No.2) B.E. 2542 (1999). The importation of prohibited material shall require the permission from the DG of DOA only for the purpose of experimentation or research in related to the following processes: The experiment must be carried out under the strict control of the Field Inspection on Biosafety Working Group responsible for inspection and monitoring in laboratory/greenhouse, closed containment and field trial. At present, there are five Field Inspection on Biosafety Working Groups; rice, maize cotton, tomato and papaya & cucurbitaceae. Rules and procedures of biosafety guidelines will be observed and strictly implemented. The working group will conclude and report the testing result at each step to the Risk Assessment Sub-Committee to evaluate the risk and safety. Risk Assessment Sub-Committee will submit the evaluated report to the Biosafety Committee for consideration. DG-DOA by recommendation and advice of the Biosafety Committee will submit an opinion to deregulate certain GM-plant to the Minister of Agriculture and Cooperatives if no adverse effects are found. The Minister of Agriculture and Cooperatives will have a final decision whether to deregulate or not. The biological risk assessment of imported transgenic plants shall take into account the following factors: The experiment will be conducted in an enclosed environment on its first introduction. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 62 s,.. .--. . - ..- . ...+. .- -,--. ++- .- +,-. .- .,,.-+ ., ,+, .+ +...-- .--. i -..+..- ,.. ,.-+ ..,-. ,.. .- ., ,... ... +. - .+--+ i- ,.-.. ,-- . i- --.. --.. -.. +. . -- .+ ..+. --- -, ,-+.. .+ ,...- i- ,., .--+- i- --.. .,. i- --.. .- ., ,.. e+, .- +-. ,.- -- ., .- +-. . +--,+..- , .- v., ,.+.+- .+ .,-...- - .. + .-., .--. ++ - ,.+-+ .- ,.. . . - +-+ +. .+,. i .. . - ..-+ .- s+...-- -+ s.-., .. ... . . .-... .+., .- -+ .+ e+, +... 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Do you need to boost your companys public image? How can your company let potential customers learn about its products and services? In todays competitive environment, getting noticed for the right reasons and by the right people is crucial to any organisations success. This is especially true in the bioindustry where savvy biotech organisations often use public relations (PR) as a tool to help them change the opinions, mindsets and actions of the public, customers, partners and investors. PR is very effective if used well, but what exactly is it? Public Relations-Back to the basics PR can be defined as the planned effort that helps develop a communication channel between an organisation and its publics. Typically, this is done on a long-term, sustained basis so as to build up better understanding, acceptance and cooperation. There are a number of different ways that PR can be used. T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 64 This includes: Media relations - This involves disseminating information through media, such as newspapers, magazines, radio, television and on-line portals. The main benefit is that information is effectively disseminated, in a manner that is generally perceived as being accurate, as it is from an independent third party. For example, having a favourable write up of a new product in a newspaper is likely to be perceived positively by more people than a paid advertisement or a corporate brochure. Another benefit is that there is usually no direct cost to the organisation for publicising such material, though costs are incurred through organising press conferences, writing press releases or arranging media interviews. Advertising - Like media relations, advertising involves disseminating information through similar media. The key difference is that advertising is characterised by payment to the media. This results in the advantage of control-control over the content, placement of content and timing of release of information. For example, a lab equipment company could put regular placements throughout the year of its products in relevant industry magazines. However advertising can result in high costs, both for the placement of the advertisement, as well as to design companies for creating unique and memorable advertisements. Corporate material - This includes brochures, posters, annual reports, newsletters, websites and other corporate information produced by the organisation. This material allows the organisation to develop its messages, according to the specific way that it wants. It can also help to build up the image and branding of the organisation. Organising of events - This allows an organisation to reach out to its target audience directly, instead of going through different forms of media as the previous activities. It includes taking part in large scale international conferences and exhibitions, or coordinating specific events related to an organisation, such as industry-specific seminars, or the launch of a product. As organisations are likely to meet T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 65 existing and potential clients, investors, collaborators, suppliers, competitors and the general public at such events, they must be well prepared in terms of information that they are presenting. Organisations in the bioindustry frequently use a range of PR activities, as communication for this industry is crucial. This industry is often associated with products and services relating to health and quality of life of mankind, and breaking scientific information into understandable layman terms is vital. Research organisations must keep the scientific community informed of their latest developments, in order to further advance their research. Furthermore, as the industry frequently requires significant investments, which take a long time to bear fruits, establishing good PR can open doors for companies seeking financial support. Tips of the trade For organisations that rely on PR activities for their continued well-being, it is recommended that they employ qualified PR staff or outsource the work to a professional company. However for those organisations with limited resources, handling PR work in-house may be a good option. Here are some suggestions should you need to implement your own PR work: 1) Identify at the start who is your target audience, what are your key messages and what your end goal is. 2) When writing a press release, it is preferable to ask non-technical staff to draft it, as usually you are writing for a journalist who may not be technically trained. Start with the most important information first, and fit in the Why, When, Who, What and How. Use simple language and explain all technical terms. Use Annexes to provide additional details. 3) If the content is highly technical, target the trade publications and industry specific media. 4) Hold a press conference if you believe there will be different media interested and many questions will be asked. If the news is more straightforward, T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 66 a simple press release should suffice. 5) Identify your spokesperson(s) and all media communication should go through him or her. Ideally your spokesperson should be the highest ranking and most relevant person, e.g. CEO if you announcing corporate information, CSO if you are announcing research or scientific information. If you have more than one spokesperson (e.g. CEO and CSO), ensure that they are updated on the latest developments, to avoid the confusion of giving out conflicting information. Prepare your spokesperson with FAQs and possible sensitive questions. 6) Be aware that media are frequently on tight time lines. If a journalist has a question that you need more time to answer, check with him or her on the time line, and stick to it. 7) Once you have established a contact with a journalist, maintain a good relationship with him or her. This can be done by contacting the same journalist with subsequent news, giving them a few days advance notice should you have a significant announcement and follow up with thank you emails and phone calls after your news is published. By using a combination of the different types of PR activities, biotech organisations can generate greater awareness and more importantly, support amongst their target audience. Effective PR will enhance your organisations competitiveness; make it an essential part of your organisations suite of business tools. About the Author Chan Yiu Lin is the Principal Consultant of Greener Grass Communications, a public relations firm specializing in marketing communications strategies for technology-based companies. She is familiar with life sciences scene and has assisted clients in launching their presence and increasing awareness in Asia. To contact Yiu Lin, email her at yiulin@greenergrass.com.sg T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 67 AGRICULTURAL RESEARCH DEVELOPMENT AGENCY (PUBLIC ORGANIZATION) 2003/61 Phaholyothin Rd Ladyao, Chatuchak Bangkok 10900 Tel: (66) 2579 7435 Fax: (66) 2579 7235 Email: veerasuda@arda.or.th Website: www.arda.or.th BIOTECHNOLOGY ALLIANCE ASSOCIATION Rm 308, 3/F, Kasetsart University Alumni Association Bldg. 50 Paholyothin Rd. Ladyao, Chatuchak Bangkok 10900 Tel: (66) 2940 5264 Website: www.thaibaa.org DEPARTMENT OF AGRICULTURE 3/F, The Center of Operation Training and Conveying Technology Bldg. Chatuchak Bangkok 10900 Tel: (66) 2579 0151-7 Email: itc@doa.go.th Website: www.doa.go.th DEPARTMENT OF INTELLECTUAL PROPERTY 44/100 Nonthaburi 1 Rd. Muang Nonthaburi 11000 Tel: (66) 2547 4632 Website: www.ipthailand.org DEPARTMENT OF LIVESTOCK DEVELOPMENT Payathai Rd. Bangkok 10400 Tel: (66) 2653 4444 Fax: (66) 2653 4925 Email: foreign@dld.go.th Website: www.dld.go.th DEPARTMENT OF MEDICAL SCIENCES 88/7 Tiwanon Rd. Muang Nonthaburi 11000 Tel: (66) 2589 0022 Website: www.dmsc.moph.go.th DEPARTMENT OF SCIENCE SERVICE 75/7 Rama VI Rd. Ratchathewi Bangkok 10400 Tel: (66) 2201 7000 Fax: (66) 2644 5698 Website: www.dss.go.th EXPORT-IMPORT BANK OF THAILAND EXIM Bldg. 1193 Paholyothin Rd. Phayathai Bangkok 10400 Tel: (66) 2271 3700 Fax: (66) 2271 3204 Email: info@exim.go.th Website: www.exim.go.th Useful address 6/10/06, 11:20 67 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 68 FOOD AND DRUG ADMINISTRATION 88/24 Tiwanon Rd. Muang Nonthaburi 11000 Tel: (66) 2590 7000 Website: www.fda.moph.go.th FOOD SCIENCE AND TECHNOLOGY ASSOCIATION OF THAILAND (FOSTAT) 113 Thailand Science Park, Phaholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 6700 EXT 3119 Fax: (66) 2564 6701 Email: fostat@biotec.or.th Website: fostat.biotec.or.th INDUSTRIAL ESTATE OF THAILAND 618 Nikommakkasan Rd. Ratchthewi Bangkok 10400 Tel: (66) 2253 0561 Fax: (66) 2253 4086 Email: ieat@ieat.go.th Website: www.ieat.go.th INDUSTRIAL PARK CENTER, KING MONGKUTS UNIVERSITY OF TECHNOLOGY THONBURI The 4th Chemical Engineering Bldg. 91 Suksawas 48 Rd. Bang Mod, Tung Kru Bangkok 10140 Tel: (66) 2470 9719 Fax: (66) 2452 3455 Website: www.kmutt.ac.th/organization/Park/#Ind INSTITUTE FOR SMALL AND MEDIUM ENTERPRISE DEVELOPMENT (ISMED) 99 Gym 1 Thammasat University Rangsit Klong Luang Pathumthani 12120 Tel: (66) 2564 4000 Website: www.ismed.or.th MARINE BIOTECHNOLOGY RESEARCH UNIT, CHULALONGKORN UNIVERSITY 254 Phayathai Rd. Pahatumwan Bangkok 10330 Tel: (66) 2218 5279 Fax: (66) 2254 7680 Website: www.biotec.or.th/marine/ NATIONAL CENTER FOR GENETIC ENGINEERING AND BIOTECHNOLOGY (BIOTEC) 113 Thailand Science Park, Phaholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 6700 Fax: (66) 2564 6701 Website: www.biotec.or.th NATIONAL FOOD INSTITUTE 2008 Charansanitwong 40 Rd. Bang Yi Khan, Bang Phlat Bangkok 10700 Tel: (66) 2886 8088 Fax: (66) 2886 8106-7 Website: www.nfi.or.th NATIONAL INNOVATION AGENCY 73/1 Rama VI Rd. Rajdhevee Bangkok 10400 Tel: (66) 2644 6000 Fax: (66) 2644 8444 Email: info@nia.co.th Website: www.nia.or.th NATIONAL SCIENCE AND TECHNOLOGY DEVELOPMENT AGENCY 111 Thailand Science Park, Paholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 7000 Fax: (66) 2564 7001-5 Email: info@nstda.or.th Website: www.nstda.or.th Useful address 6/10/06, 11:20 68 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 69 OFFICE OF SMALL AND MEDIUM ENTERPRISES PROMOTION (SMEs) 17/F, TST Bldg. 21 Vibhavadi-Rangsit Rd, Chatuchak Bangkok 10900 Tel: (66) 2278 8800 Fax: (66) 2273 8850 Email: info@sme.go.th Website: www.sme.go.th OFFICE OF THE NATIONAL RESEARCH COUNCIL OF THAILAND 196 Paholyothin Rd. Chatuchak Bangkok 10900 Tel: (66) 2561 2445 Website: www.nrct.net PHARMACEUTICAL RESEARCH & MANUFACTURERS ASSOCIATION 21/F, Paholyothin Place Bldg. 408/51, Paholyothin Rd. Samsen Nai,Phayathai Bangkok 10400 Tel: (66) 2619 0729-32 Fax: (66) 2619 0728 Email: info@prema.or.th Website: www.prema.or.th PROTEIN SOCIETY OF THAILAND 4/F, Rm 427, Chalermprakiat Bldg. Faculty of Science, Mahidol University Rama VI Rd. Bangkok 10400 Tel: (66) 2201 5840 Fax: (66) 2201 5843 Email: proteinthai@gmail.com Website: http://cbag2.sc.mahidol.ac.th/protein SERVICE CENTER FOR MEDICINAL PLANT INFORMATION 447 Sriayudhya Rd. Ratchathewi Bangkok 10400 Tel: (66) 2644 8677-91 Fax: (66) 2354 4327 Email: headpypi@mahidol.ac.th Website: www.medplant.mahidol.ac.th SHRIMP BIOTECHNOLOGY BUSINESS UNIT (SBBU) BIOTEC Pilot Plant, Module 2 117 Science Park, Paholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 6531 Fax: (66) 2564 (66)02 Email: info@shrimpbiotec.com Website: www.shrimpbiotec.com TECHNOLOGY MANAGEMENT CENTER (TMC) 111 Thailand Science Park, Paholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 7000 Fax: (66) 2564 7003 Website: www.nstda.or.th THAI SOCIETY FOR BIOTECHNOLOGY 73/1 Rama VI Rd. Ratchthewi Bangkok 10400 Tel: (66) 2644 8150 Fax: (66) 2644 8150 EXT 406 Email: tsb@biotec.or.th Website: tsb.biotec.or.th Useful address 6/10/06, 11:20 69 T H A I L A N D B I O T E C H G U I D E 2 0 0 6 / 2 0 0 7 70 THAILAND BOARD OF INVESTMENT 555 Vibhavadi-Rangsit Rd. Chatuchak Bangkok 10900 Tel: (66) 2537 8111 Fax: (66) 2537 8177 Email: head@boi.go.th Website: www.boi.go.th THAILAND CENTER OF EXCELLENCE FOR LIFE SCIENCES (TCELS) 22/f CMMU Bldg. 69 Vibhavadi-Rangsit Road Samsen Nai,Phayathai Bangkok 10400 Tel: (66) 2644 9524 Fax: (66) 2644 9538 Website: www.tcels.or.th THAILAND SCIENCE PARK (TSP) 111 Thailand Science Park, Paholyothin Rd. Klong Nueng, Klong Luang Pathumthani 12120 Tel: (66) 2564 7222 Fax: 66 2564 7201 Email: Tsp-mkt@tmc.nstda.or.th Website: www.sciencepark.or.th THE ASIA & PACIFIC SEED ASSOCIATION 7/F Institute of Food Research and Product Development Bldg. 726, 731, Kasetsart University Chatuchak Bangkok 10900 Tel: (66) 2940 5464 Fax: (66) 2940 5467 Email: apsa@apsaseed.com Website: www.apsaseed.com THE FEDERATION OF THAI INDUSTRIES 4/F, Zone C QSNCC, New Ratchadapisek Rd. Klong Toei Bangkok 10110 Tel: (66) 2345 1000 Fax: (66) 2345 1296 Email: information@off.fti.or.th Website: www.fti.or.th THE GOVERNMENT PHARMACEUTICAL ORGANIZATION 75/1 Rama VI Rd. Ratchathewi Bangkok 10400 Tel: (66) 2354 8857 Fax: (66) 235 9958 Email: intgpo@health2.mogh.go.th Website: inter.gpo.or.th THE THAILAND RESEARCH FUND (TRF) 14/F, SM Tower 979/17-21 Paholyothin Rd. Samsen Nai,Phayathai Bangkok 10400 Tel: (66) 2298 0455-75 Fax: (66) 2298 0455 Email: callcenter@trf.or.th Website: www.trf.or.th Useful address 6/10/06, 11:23 70