Alor Gajah: World Biotechnology Hub?

I read with extreme interest, an article in the New Straits Times which proclaimed that Alor Gajah (in Melaka, by the way), will soon become the "next biotechnology hub of the world". Undertaking this "massive project costing RM1.36 billion" at the 113ha site is "California-based Actis Biologics Inc, a bio-pharmaceutical company which has set up a Malaysian-registered company Actis Biologics Malaysia Sdn Bhd."

Now, don't get me wrong, I welcome such investments into Malaysia, and certainly if indeed Malaysia can become a global biotechnology hub, it will be excellent news for the country. However, having experienced plenty of disastrous mega-projects in Malaysia with supposed foreign investment or participation, you will forgive me if I am a little apprehensive (understatement?) when it comes to such mega-announcements. I can't help but to suspect if there's anything fishy going on.

I'll just name a few examples here. Datuk Keramat Holdings Berhad was supposed to deliver the first phase of a US$60 million studio and entertainment complex is planned on a 480-hectare piece of land in Cyberjaya. It was to form an integral part of MSC's most prestigious project: the creation of a $790-million high-tech film studio and a Disneyesque theme park complex called the Entertainment Village. Unfortunately, the grand launch during the 2001 International Advisory Panel, complete with Jacky Chan in a shimmering white outfit, proved to be the only highlight of that initiative. Instead of sharing the blame, Multimedia Development Corporation laid the blame squarely on the developer after millions of ringgit was burnt.

And, what about another of Dr Mahathir Mohammad's favourite projects - InventQjaya?
A Dr Sadeg of Reveo Inc (USA), a Libyan-American, told CNN's TalkAsia host Lorraine Hahn in a programme aired in November 2002 that former premier Mahathir Mohamad had invited him to invest in Malaysia's Multimedia Super Corridor after a meeting in New York. The project is funded by a government loan of RM437 million, of which RM228 million has been paid out. Now, with practically nothing to show besides the ownership of several commercially useless patents, the Malaysian government is charging Reveo of money laundering and absconding with the loan. Disaster? You tell me.

Of course, lets not forget the latest mega-project scandal the Port Klang Free Zone (PKFZ), a RM1.3 billion project which ballooned to RM4.6 billion, which in turn now requires government bailout with a soft loan which will probably never see the light of day.

So, back to our very own "RM1.36 billion bio-technology hub". Who is this Actis Biologics Inc, and are they sufficiently competent to manage such mega projects? With the project suffer the same fate as InventQjaya and require the same bailout like PKFZ?

I've done some very simple preliminary checks, something that you and me can all do with Google. Here are some initial and not necessarily conclusive findings, which nevertheless, raises some interesting questions for the authorities to follow up on:

1. Based on a free summary report by Dun & Bradstreet, a premier provider of international and US business credit information and credit reports, Actis Biologics is an unlisted company which started in 2004. It has annual sales of US$530,000 and 7 employees.
   
   Um.. a 3 year old company with 7 employees and revenue of about half a million US Dollars, taking on a RM1.3 billion "world biotechnology hub" project?
   
   
2. Now, if the above data is sufficiently intriguing, there's a more detailed business information report available for US$110.00, which may contain further juicy information. The report studies key performance information, including sales figures, net worth, financial condition, legal suits etc. I'm sure the relevant Malaysian government authorities in-charge of the project will find the US$110 money well spent. There are of course, other reports on the company which can be purchased.
   
   
3. It will of course be useful to see other projects which Actis have undertaken, and in particular, one in India which was launched at the end of 2005. Despite many press statements then sounding overwhelmingly similar to the NST article, no further news is available as to the progress of the project in Mumbai. As reported in the Economic Times, India, Actis planned a US$3 million investment in a R&D lab in India. Also, check out the report in Hindu Business Line or the one at Rediff.com:
   

   US-based biopharmaceutical company Actis Biologics Inc is setting up its wholly owned subsidiary in India in a move to make the country a hub for its clinical research and developmental activities.
   
   Having recently licensed the angiozyme technology, jointly developed by Sirna Therapeutics and Chiron, Actis expects this technology platform to power drug development in different segments. This technology helps block blood supply to cancer cells and the same method can be used for fat cells too, he said.
   

4. Which brings me to this "angiozyme" technology. A 1-pager introduction on the enzyme is available here. Actis bought the rights to Angiozyme from the owners, Sirna and Chiron for worldwide distribution i.e., Actis isn't the inventor of the product. As reported here in the November 2005 edition of the Business World, India:
   

   Actis does not do any drug discovery. Instead, it licences promising drugs that have cleared early stages of human trials from either universities or biopharmaceutical firms in the US after a due diligence by its own scientific team. What Actis wants are partners in India that would be interested in helping it take these products through clinical trials in exchange for marketing rights in emerging markets and global manufacturing rights.
   
   Actis expects that the capital will be put up by the Indian partner while Actis brings the clinical and manufacturing expertise needed for a completely new biotech product.

The question then is, and I assume the situation is relatively similar for Alor Gajah, if Actis is not bringing in the much needed capital, then who is forking out the RM1.3 billion investment? The Malaysian Government? You and me?

Let me reiterate, I have every wish that the project announced by Actis will be wildly successful, for then it'll prove to the world that Malaysia is a worthwhile country to invest in. However, our past experiences, particularly with incompetent and guillible government officials, it certainly necessitate that stringent due diligence be conducted to ensure that we don't dig another hole for ourselves.

Open Tenders

PERMATANG PAUH asked the prime minister to elaborate on the Government's commitment in implementing an open tender system as announced by the Prime Minister on achieving his 100 days in office as the Prime Minister; and the type and justification of projects which exceed RM10 million above which are still being negotiated through direct negotiation or close tender basis after surpassing the above days.

The Prime Minister responded by providing various reason why open tenders were not held and in many instances only local companies were qualified. I'll need to confirm the statistics again in the Hansard, when it gets updated, but he mentioned that 38% of Government projects above RM10m were concluded via direct negotiations. More details are probably needed as to whether this percentage is calculated by quantity or value of these projects.

The Prime Minister also gave the view that local companies need to be given protection and in certain instances, specific expertise was required, hence the "direct negotiations" approach.

I had my supplementary question prepared, but as expected, due to "seniority" didn't get my chance to ask (the only supplementary question allowed). My boss from BAGAN got the opportunity instead, and asked about the lack of open tenders and the impact on corruption.

Anyway, here was my supplementary question, had I had the opportunity:

Kenapa projek jambatan Pulau Pinang kedua diluluskan secara runding terus tanpa open tender walaupun saiz projek tersebut amat besar?

Dan yang lebih penting - kenapa projek tersebut diluluskan dan diberi kepada syarikat berkaitan SEBELUM harga kontrak dan hargan pembinaan ditetapkan dan ditentukan, yang menyebabkan kos jambatan kerap naik dari RM2.5b sehingga RM3.5b sehingga kini RM4.3b dan ada berita bahawa pihak kontraktor meminta sebanyak RM4.8b?

Spanking New CIQ Johor Bahru?

Ater 41 years of being in operation, the Malaysia-Singapore Causeway checkpoint finally closed its doors at 12.01am on 15 Dec. All activities and its operations moved to the spanking new Bangunan Sultan Iskandar Customs, Immigration and Quarantine (CIQ) complex.

The immigration department director said that “traffic was at a slight crawl as there were some technical difficulties. All immigration personnel have been moved to the new complex, and we expect the new complex will reduce traffic congestion."

But since, the Star letters page have been flooded with non-stop complaints. I'm sure they have received much more rude letters which can't actually be printed as well from commuters. Check out letters "Chaos at new CIQ Complex", "No excuse for chaos" and "Pedestrians have it tough".

And 'Suffered Man' wrote to me to describe the complete failure by the traffic and engineering consultants at the CIQ.

Hi Tony,

I am one of the few hundred thousands of people travelling everyday to work in Singapore. The new CIQ that was operated fully since Tuesday, 16th Dec. have caused a disaster to us.

I feel very very disappointed because our stupid government never study properly on whole building design. The roads lead to the checkpoint are very narrow (2 lines). So it causea bottleneck at checkpoint. Imagine the mouth is so big but the stomach is so small. The traffic at the entrance is so massive but inner ring roads are only two lanes.

Malaysia boleh?  Pic courtesy of The Star Gallery

How do they going to solve this problem? The roads have been built, and seem like there are no ways to expand it. Did they survey properly on the traffic flow before building this CIQ? I think probably NO.

I just think that we are earning foreign currency and brining back to Malaysia to spend, more or less has been helping local economy to go on. We love our country. But did country loves too? What has this stupid government done to us? Those VIP & VVIP come down JB and have a grant opening for CIQ, then left silently without taking care of our suffer here after this.

Please help us to question them in Parliment, how are they going to solve this problems??? If not those VIP & VVIP will 'buat tak tau' and never solve this problem at all.

If you go back to your hometown (Batu Pahat), kindly do pay a visit to this 'luxurious' CIQ.

Your help is much highly appreciated.

Best Regards,
Suffered Man from JB

Iskandar Malaysia

The Prime Minister who is also holding the portfolio of Finance Minister, Datuk Seri Abdullah Ahmad Badawi had on 11th March announced the change of name of the "Iskandar Development Region (IDR)" to "Iskandar Malaysia". I wrote on IDR when it was first announced in early 2007.

It is worth noting that this is the 2nd time the name of the project has been changed since it was launched in July 2006, which was initially named "South Johor Development Corridor (SJER)". The frequency at which the name of the project has been changed reflects badly on our government and administrators for it serves to embed confusion amongst investors. In addition, it also reflects a leadership which is unable to make up its mind and stick with a decision, at least for a meaningful period, once it has been made. This reflection certainly does not bode well in breeding investor confidence for our projects.

At the same time, the Finance Minister has declared that Iskandar Malaysia is on target to reach its investment target of RM47 billion within the next 2 years as the project has already "secured" 70% of its investment target, or almost RM33 billion. If the figure announced reflects reality, then certainly, it is an impressive feat achieved by the Government.

Hence it is of utmost importance for the Finance Minister to announce the details of investments which have been committed to date for Iskandar Malaysia to establish the credibility of the Government. Datuk Seri Abdullah Ahmad Badawi must declare:

1. Of the [RM14 billion] of investments "secured", what is the breakdown between contractually-bound investment agreements, e.g., those with penalty clauses for termination; and those which are based on "memorandums of understanding (MOUs)" not bound by contract?
   
   
2. Of the "secured" investments, what is the breakdown between the Government of Malaysia, local Malaysian private investors and foreign direct investors?
   
   
3. Of the "secured" investments, how much of the committed funds have been invested, in Iskandar Malaysia?

The people of Malaysia wishes Iskandar Malaysia to be an unqualified success, particularly in attracting renewed value-added foreign direct investment to the country. However, to do so, the Finance Minister must provide the necessary information for us to evaluate the status of the project and to come up with the necessary plans to ensure its success.

It is hoped that in the light of the results of the 12th General Elections, the Government will adopt a new culture of transparency to allow for greater contribution by parliamentarians and Malaysians in general.

(Check out Wikipedia for more info on Iskandar Malaysia)