A new investment fund is being established in the Czech Republic with focus primarily on spin-off companies in the areas of natural sciences, medicine and biotechnology originating at academic facilities in the Czech Republic and neighbouring countries. The fund is being set up thanks to successfully negotiated cooperation with the i&i Prague incubator, which is part of the innovation ecosystem of the Institute of Organic Chemistry and Biochemistry (IOCB) of the Academy of Sciences of the Czech Republic and the European Investment Fund (EIF).
The EIF has decided to invest several tens of millions of euros in the newly established fund. i&i Prague, or rather its parent IOCB and the Academy of Sciences are thus becoming members of a very narrow group of the most significant European scientific institutions which, with the quality of their scientific work and ability to commercialise their results, were able to convince the EIF to engage in investment cooperation. These also include, for example, the Flemish Institute of Biotechnology (Belgium), the Catholic University of Leuven (Belgium), Chalmers University in Gothenburg (Sweden), the University of Manchester (Great Britain) and the Karolinska Institute in Solna (Sweden).
“Fulfilling the EIF’s requirements was not easy and approval of cooperation on the part of the EIF happened after more than two years of intensive discussions. The primary decisive factor for the EIF was the quality of the results achieved by the research institutes that collaborate with us, as well as the successes achieved so far by the spin-off companies that we already have in our portfolio,” says RNDr. Ing. Jaromír Zahrádka, Ph.D., director of i&i Prague. “Thanks to the funding that we will receive thanks to the EIF, it will be possible to support dozens of projects involving the development of new medications, diagnostics and innovative medical devices, which would otherwise not have a chance of further development. We are already registering strong interest from significant Czech universities and research institutes in funding for their prepared spin-offs,” Zahrádka adds.
“To date, venture capital has not been very available for these spin-offs in the Czech Republic, so the fact that the European Investment fund chose to establish cooperation with the Academy of Sciences shows that the quality of research conducted at the ASCR has long been drawing level with that of the most advanced countries in Europe,” adds Prof. RNDr. Eva Zažímalová, CSc., chairwoman of the Academy of Sciences of the Czech Republic.
“At CzechInvest, we have long been monitoring, mapping and supporting innovative entities, which naturally include spin-offs established at academic institutions. Last year, we also published a Spin-Off Guide, which comprises a set of guidelines on how to eliminate a number of baseless concerns from the process of establishing spin-offs. The innovation ecosystem, which was established based on an initiative of the IOCB, is innovative in many respects and we are striving to play a role in cultivating it in the context of the Memorandum of Cooperation between the two institutions. The fact that the cooperation between i&i Prague and the EIF is expanding the possibilities of financing for spin-offs in the Czech Republic is unambiguously positive news for us,” says Doc. Ing. Jiří Krechl, CSc., who manages research and development activities at CzechInvest.
The new fund will be established in the next several months, as soon as the necessary legal procedures have been completed and all negotiations on the release of funding from the EIF have been concluded. In addition to i&i Prague and the EIF, several other investors and partners, with which negotiations are entering the final phase, should also become involved in the cooperation.
The new fund will be focused primarily on spin-off companies built on globally unique technologies developed at academic facilities in the Czech Republic and in other EU member countries. The fund will support the establishment of such companies and their development over the next five years with more than CZK 1 billion. The initial investments should be undertaken in 2021.