Drug manufacturing in Chile: pharmaceutical companies head South

Lower labor costs, highly trained scientists, government support and innovative environment are making Chile the destination of choice for emerging pharmaceuticals. 

“This is where it all happens, this is where we have fun,” Sebastián Bernales, a Chilean biochemist and research director of U.S. biopharmaceutical company, Medivation, told Business Magazine Chile.
Bernales and a dozen other researchers in white medical coats work amid trays full of brightly colored liquids and high tech microscopes, tucked away on the second floor of a building in the suburban neighborhood of Ñuñoa, Santiago.
The team are on the verge of a major breakthrough. Medivation are just about to launch a drug called Enzalutamide (a.k.a. MDV 3100) – developed with the help of the Chilean scientistswhich fights prostate cancer, and could extend the life of patients by 40 percent.
Expected to be approved by U.S. regulators in the coming months, the drug has already seen shares in Medivation skyrocket on the back of successful clinical trials, up from US$16 in November, 2011 to US$88 in May of this year.
Meanwhile the company’s market valuation has soared to over US$3 billion.
Why Chile?
Bernales’ team – which played a key role in gathering data on how the drug works, a crucial process in getting approval – was selected partly due to the relationship of Bernales and world-renowned Chilean biochemist Pablo Valenzuela with other colleagues in the United States.
Bernales holds a PhD in biochemistry from the University of California and did an internship at Valenzuela’s biopharmaceutical firm Chiron, also based in California. Meanwhile, Valenzuela returned to Chile in 1997 and established the non-profit Fundación Ciencia Para La Vida (“Life Sciences Foundation“), keeping in touch with his former colleagues from the U.S.
So years later, when Medivation’s president and CEO David Hung was looking to outsource research, he thought of Valenzuela, and in 2007, Hung asked Bernales to lead Medivation’s first lab outside the United States.
“Opening a lab in Chile for a U.S. company was a crazy idea, but you never know where the next discovery will come from,” said Bernales.
For the Chilean scientist, his country’s main advantage is the high quality and low cost of its scientists. “There is a limited pool of people to hire from and supplies are more expensive, but human resources are much cheaper and our scientists are really well prepared,” he said.
Bernales added that an innovation friendly environment is also a key factor that will continue to draw pharmaceutical companies to Chile, as well as the support of public institutions like Scientific and Technological Development Fund (FONDEF) which has helped fund Bernales’ team.
And then there are the private foundations, such as the Fundación Ciencia Para La Vida, which Bernales said had helped the company negotiate regulations, and work at a fast pace.
For more information, check out the Business Magazine Chile article.