Positioning Singapore as a Global-Asia Hub of Technology, Innovation and Enterprise

Introduction

Members of the media, good afternoon and thank you for joining us at A*STAR’s year-in-review.

Today, I will share with you A*STAR’s achievements in Year 2 of the national Research, Innovation and Enterprise (RIE) 2020 plan.

Global Economic Outlook and Trends

At the global level, growth is projected to rise to 3.9 percent in 2018 and 2019. This upswing is reflected by an increase in world trade, especially among the advanced economies.

There is also an economic shift towards Asia. By 2030, Asia is expected to make up more than half of the world’s middle-class population, and account for the bulk of the demand for consumer goods and services. Advanced economies are increasing their RIE investments to boost their competitiveness:

• China aims to become a global manufacturing leader, investing in massive research facilities and innovation zones, under its Made in China 2025 Strategy. It already has the world’s most powerful supercomputer and captured half of global AI startup funding ahead of the US.

• The US has approved its largest research spending in a decade. Nearly all science agencies in the US will see their budgets grow in 2018, under a US$1.3-trillion spending deal announced in March 2018.

• The UK launched the UK Research and Innovation (UKRI) organisation to bring all the research councils together under one umbrella in order to better coordinate science and research across all the disciplines and along the innovation value chain in the UK. Based on the recently published Industrial Strategy White Paper, the UK also has ambition to increase its Gross Expenditure on Research and Development (GERD) from 1.7 per cent GDP to 2.4 per cent GDP by 2027.

• Germany has embarked on a high-tech Industrie 4.0 strategy to scale smart manufacturing, and they also have a stepped up goal to increase its GERD from 2.9 per cent to 3.5 per cent by 2025.

• Closer to home, Japan has also rolled out Society 5.0, its strategic blueprint to leverage artificial intelligence and big data to drive digital transformation. Japan aims to increase its GERD from 3.1 per cent to at least 4.0 per cent by 2020

Given these global developments, Singapore needs to continue to sharpen our differentiation and deepen our value proposition to remain competitive.

Innovation for Singapore’s Future Economy

R&D and Innovation is at the heart of Singapore’s drive to remain competitive and to grow the economy. The government has sustained its commitment to RIE and businesses are responding positively.

One measure is the business expenditure on R&D (BERD). According to the 2016 National R&D Survey, the amount that businesses in Singapore spent on R&D has been maintained at around $5.7 billion.

In 2016, the electronics, and biomedical sciences-related sectors remained the largest contributors to BERD.

In her recent address at the opening of the second session of the 13th Parliament on 7 May, President Halimah spoke about how Singapore’s investments in R&D are bearing fruit, enabling us to exploit deep technology and digitalisation, to conceive, test-bed and scale up new products and services.

Indeed, A*STAR’s efforts align with the Future Economy Council’s goal to help our key industry sectors thrive in the age of digital and technological disruption. In particular, A*STAR, along with our fellow MTI agencies EDB and ESG, work closely together to shape and implement the Industry Transformation Maps in the Manufacturing Cluster.

A large part of the efforts is to encourage and facilitate our companies to adopt emerging technologies and develop digital capabilities in high-value manufacturing. Under the government’s RIE 2020 plan, A*STAR has done well in executing the innovation agenda, and supporting our national priorities outlined by the Committee on the Future Economy.

We have maintained the momentum of our R&D efforts, and continued to catalyse innovation for industry, helping our local enterprises remain relevant, and keeping Singapore globally competitive.

Let me now touch briefly on A*STAR’s achievements in the year 2017.

Keeping Up the Momentum for RIE2020

In FY2017, we worked on over 2,100 projects with companies, a 20 per cent increase over FY2016.

Out of the industry projects undertaken, one third remained with local enterprises. At the same time, A*STAR achieved around $340 million of R&D spending through industry projects with our RIs, a more than 50 per cent increase from $220 million in FY2016.

More significantly, R&D spending by local enterprises outpaced this increase, growing by around two thirds from $61 million to $102 million. More local companies are also taking up A*STAR licenses.

Three-quarters of over 260 A*STAR licenses were taken up by local enterprises, compared to about 60 per cent of 235 in FY2016.

These licenses cover a broad range, from antibodies, to AI speech services, and inventory management tools.

They enable the companies to grow their innovation capacity, and bring innovative products and services to market.

All these show that some of our local enterprises are stepping up to grow their innovation capacity and undertaking R&D to build competitive businesses.

Future of Manufacturing

The manufacturing sector has continued to boost the economy, with an expansion of 10 per cent on a year-on-year basis for the first quarter of 2018 . Singapore must maintain a globally competitive high-value manufacturing industry. This is why A*STAR launched the FoM Framework at the beginning of RIE 2020 and the effort continues to gain traction with the industry.

In the last review, I mentioned that we were working with Rolls-Royce to focus on developing smart manufacturing capabilities in the Aerospace sector. Last September, we established a joint lab with Rolls-Royce and SAESL, a five-year programme worth S$60 million, that will allow both parties to speed up the development of innovative technologies. These technologies will be adopted at Rolls-Royce and SAESL’s facilities to improve productivity, save costs and enhance competitiveness.

Around the same time, A*STAR initiated the Pharma Innovation Programme Singapore (PIPS). Partnering with the National University of Singapore (NUS), we bring together leading pharma companies GSK, Pfizer, and MSD, to transform manufacturing operations and technologies of this sector. We have also started discussions to collaborate with companies in the food manufacturing and fast moving consumer goods industries who are keen to tap on the latest technologies on the factory floor to increase their productivity.

A*STAR’s FOM Technologies

Last year, A*STAR also launched specific initiatives under its Future of Manufacturing Framework. The goal is to sustain Singapore’s competitiveness in manufacturing and technology innovation, so that it is a location of choice for developing, test-bedding and deploying advanced cutting-edge technologies in the manufacturing sector. The key thrusts of these initiatives are the public-private partnership platforms of Tech Access, Tech Depot and Model Factory, that aim to drive technology innovation, knowledge transfer, and adoption across the manufacturing industry.

Tech Access provides local enterprises with access to A*STAR’s advanced manufacturing equipment and facilities, as well as training and technical advice. Through this platform, we have supported 30 companies since, to help them appreciate and then adopt specific new technologies and capabilities to complement what they already have.

Through our Model Factory initiative, A*STAR bridges technological gaps in the private sector, helping businesses to re-invent themselves through effective technology adoption at the system level. The initiative provides a ‘live’ production environment allowing companies to experience and experiment with advanced manufacturing technologies and co-develop innovative solutions for greater productivity and efficiency. So far, over 30 companies have participated in this initiative.

We are also supporting SMEs in technology adoption through Tech Depot which was launched in April 2017. Tech Depot offers companies readily adoptable technological solutions, developed and pre-qualified by A*STAR, ESG and IMDA. To date, there have been 265 adoptions of A*STAR’s ready-to-go technologies through this platform.

MD Dr Raj Thampuran will provide more details on these later.

From Innovation to Value Capture

Beyond transforming manufacturing, A*STAR, together with the wider community, has achieved significant breakthroughs in other areas and I shall highlight two today.

Catalysing A Vibrant Local Biotech Ecosystem in Singapore

In my opinion-editorial for the Straits Times last July, I mentioned that our local biotech sector has reached an inflexion point. Over the years, we are seeing a significant increase in the number of local biotechs with innovative drug pipelines and services that were made in Singapore. From 2010 to 2017, at least 60 local drug-development and related biotechs have been incorporated, tripling the 19 of the preceding decade (2000-2009). As an indication of this rapid growth, around the same period, the R&D expenditure of these biotechs saw an increase of nearly nine-fold, from S$21m to S$186m.

A*STAR has played a part in nurturing our nascent biotech ecosystem – one-third of these biotechs were A*STAR spin-offs, and more than half of them have some form of IP, co-development project, or joint lab with A*STAR.

For example, Tessa Therapeutics, a clinical stage biopharmaceutical company, has collaborated with A*STAR’s Institute of Molecular and Cell Biology (IMCB), through a joint laboratory to build on Tessa’s virus-specific T cell platform, to create next generation of immunotherapies that treat solid cancer tumours.

This partnership follows Tessa’s announcement that it was conducting the world’s largest T cell therapy cancer trial, using its core virus-specific T cell (VST) technology to treat nasopharyngeal cancer.

Tessa is also collaborating with IMCB and A*STAR’s Singapore Immunology Network (SIgN) and the National Cancer Centre Singapore, to investigate viruses that cause cancers. Last year, Euchloe Bio, a spin-off from A*STAR, which develops novel therapeutic antibodies for cancer treatment and therapy, was acquired by Tessa.

Just a few months ago, Tessa closed a USD 130 million financing round led by Temasek and joined by EDBI, Karst Peak Capital, Heliconia, Heritas and other investors .

It is heartening to see the growing presence of biotech companies in Singapore, as they are receptacles for A*STAR’s assets and IP and that of the wider public sector research performers to benefit the economy and our society.

Strengthening Singapore’s Leadership in Microelectronics

Today, we are also pleased to announce a new spin-off from A*STAR, which has unique capabilities in customisable protoyping and commercial manufacturing for silicon photonics integrated circuits.

There are not many start-ups like it.

This spin-off is called the Advanced Micro Foundry (AMF), a specialty commercial foundry for integrated optics manufacturing with expertise in silicon photonics technology.

AMF has secured investments and the company is valued at around US$300 million. It is also in the process of securing additional investments for future capital and operational needs that may raise the valuation to US$400M.

This achievement is a result of having invested early in fundamental research, and building capabilities for over a decade, and then having the responsiveness to seize the economic opportunities when the time was right.

In the early 2000s, A*STAR decided to invest in research in silicon photonics, a technology platform that is now a game changer for future computing systems and advanced data centres.

Since then, we have developed market leading capabilities that enabled A*STAR to support nearly 70 per cent of the integrated photonics industry in silicon wafer fabrication, bringing the technology to production and commercialisation.

In this digital age, the increasing need for high-speed data communications is driving demand for silicon photonics devices that enable unprecedented performance, functionality, and economies of scale compared to traditional optic devices.

Manufacturers are under pressure to innovate rapidly and tailor their products to meet consumer demand for trend-based, unique products such as mobile devices, autonomous vehicles, as well as smart home devices. This calls for flexible and cost-efficient manufacturing setups capable of high-mix low-volume production, which are currently lacking in the traditional fabrication plants.

This is a niche position for AMF.

It is the world’s first commercial micro foundry capable of high-mix low-volume manufacturing and specialising in silicon photonics, and primed to cater to current industry demands.

AMF will also add to the small but growing number of deep tech local companies that will become useful receptacles for the innovative technologies developed in our public sector research entities.

AMF is led by Dr Tan Yong Tsong, former Executive Director at A*STAR. AMF’s board will be chaired by leading industry veteran Dr Sun Shih-Wei, who was previously UMC’s Vice Chairman and CEO, and who brings a wealth of experience in starting and leading large-scale foundries.

The creation of AMF marks a major milestone for A*STAR and Singapore. It is a testament to A*STAR’s commitment to develop differentiated capabilities and nurture talent, enabling us to capture valuable economic opportunities for Singapore.

Conclusion

To conclude, we have sustained the momentum of our R&D efforts under RIE2020, delivering on our mission to catalyse innovation and propagate the digital transformation in our key industry sectors, and help our local enterprises become more productive and competitive.

Long-term investments in excellent and differentiated research are necessary to build capabilities for the future. These enable us to better respond to market opportunities when they arise, and derive greater value from our research and innovation efforts. Through our sustained investments in developing competitive research capabilities, we are able to adapt to the evolving global trends, to create and capture value for Singapore, and position Singapore as a Global-Asia hub of technology, innovation and enterprise.

Thank you and let me now invite MD Raj Thampuran to speak on the details of A*STAR’s achievements in FY2017.