MALAYSIA, which aspires to become a global biotechnology hub, will launch a US$200 million (RM730 million) biotechnology fund today.

The country wants to have a big slice of the world's biotechnology industry, which would be worth over US$1 trillion (RM3.65 trillion) by 2015.

The fund, called Malaysian Life Science Capital Fund, is one of Asia's biggest and will be launched by Prime Minister Datuk Seri Abdullah Ahmad Badawi.

The Government has already allocated RM150 million for the fund under the Ninth Malaysia Plan (2006-2010), and more money will be raised from financial institutions, government-linked companies (GLCs) as well as local and foreign private investors.

Abdullah will also officially launch the country's first full- fledged government-owned drug and biotechnology firm, Inno Biologics Sdn Bhd, whose plant is built at a cost of RM100 million.

Abdullah will also launch a hub for biotechnology companies called "BioNexus" to bolster Malaysia's biotechnology sector.

Malaysian Biotech Corp Sdn Bhd chief executive officer Iskandar Mizal Mahmood said details of the recipients of the fund will be revealed today.

"Now we have the funding infrastructure available to bring the research and development findings into the market," Iskandar told reporters at a media briefing at Inno Biologics new facilities in Nilai, Negri Sembilan yesterday.

"Some 40 local and international biotechnology firms will receive their funding today," he added.

Malaysia has some 100 biotechnology firms and the sector aims to contribute 5 per cent to the country's gross domestic product by 2020.

The fund will be handled jointly by government-owned venture capital firm, Malaysian Technology Development Corp Sdn Bhd (MTDC), and Burill & Co.

The fund is the sector's very own dedicated funding mechanism. It needs one because it is shunned by banks due to the high investment risks and huge loans needed to push the sector forward.

San Francisco-based Burill is the world's pioneer venture capital company in the field of biotechnology, managing about US$650 million (RM2.37 billion) in funds.

Inno Biologics is a wholly-owned subsidiary of Inno Bioventures Sdn Bhd, which in turn is 90 per cent owned by a Minister of Finance Inc-owned company, with a paid- up capital of RM75 million.

The remaining 10 per cent is owned by the Malaysian Industry-Government Group on High Technologies (Might).

The fund will invest in emerging and successful biotechnology companies in both Malaysia and overseas, and firms will be selected based on Malaysia's biotechnology aspirations in fields such as healthcare, industrial and agri-biotechnology.

Future business proposals will be jointly evaluated by MTDC and Burill.

Out of the US$200 million (RM730 million), US$140 million (RM511 million) will be invested in about 20 companies, while the remaining will be invested in the Burill Life Science Capital Fund.