Auckland BioSciences leads the way in animal serum technology

New Zealand’s clean history of cattle disease has boosted business for Auckland serum company Auckland Biosciences, but the country’s greatest strength could also be its biggest weakness, founder John Chang said.

Dr John Chang has had a career of more than 30 years in science - from managing a HIV research laboratory in Australia to becoming an investor in multiple bioscience start-ups. Auckland BioSciences, which was founded in 2013, processes serum from animal blood collected at NZ abattoirs. The serum is then used by multinational pharmaceutical companies to manufacture veterinary vaccines.

“New Zealand is right up there with the rest of the world in the biosciences industry,” Chang said. “Of all the major farm animal diseases, New Zealand hasn’t had any one of them. So, we sit right at the top of the list of the most preferred suppliers in the country.” But this advantage also puts the industry at risk if a disease were to break out, Chang said. “New Zealand is susceptible to major diseases because we’ve never had any before. If introduced there is a danger of it spreading across the country very quickly,” he said. “We have to rely on the robustness of MPI [Ministry of Primary Industries] to make sure pathogens aren’t introduced to New Zealand.”

Chang said New Zealand was an attractive market for overseas healthcare companies. Two of the largest serum companies in the world, GE healthcare and Thermo Fisher’s, global procurement offices are based in New Zealand. The animal blood plasma products and derivatives market is expected to be worth US$1.92 billion (NZ$2.8b) by 2024.

Chang said his five-year-old business had been growing rapidly and a major part of that was due to his young staff. The average age of his 18 employees was 27. “They’re fearless and the most tech-savvy in gathering market intelligence. That coupled with a very experienced board has been the success of the company.” Auckland Biosciences has partnered with a number of meat works companies to use slaughtered animals’ blood for its serums. The blood, that would normally go to low value products like fertilisers or stock feed, is used for vaccinations that can prevent bovine diseases. Chang said Auckland Biosciences sold its serum to multi-billion dollar companies across 14 countries, including India, China, Turkey and Russia. “We’re spread fairly evenly across those 14 countries. We don’t want to put all our eggs in one basket, I’m a strong believer of long tail theory and that is spreading the risk to various markets. “They’re all very important to us, there isn’t one predominant market.”

Long tail marketing refers to the strategy of targeting a large number of niche markets with a product or service. Chang said he was looking forward to the next 12 months for his business. “We’ll be investing another $1.2 million in a new building to set up sterile filtration. The vision there is to value-add further process and modify and keep as much wealth in New Zealand as possible.” Moving into new markets is also on the agenda for Auckland Biosciences in 2019.

Words by Anuja Nadkarni