Latin America has traditionally lagged behind in areas such as biotech and deep tech, but recently, it seems as though some countries in the region are starting to benefit from increasing investment in these areas.\n\n\n\nThe reason Latin America has been slow to develop its biotech scene is largely due to the fact that government investment in research and development (R&D) has been relatively low when compared to countries like the U.S..\n\n\n\nHowever, between 2012 and 2017, private investment in Latin America’s pharmaceutical industry almost doubled, and this capital is also expanding the development of new medical devices and medications, helping to revolutionize healthcare in the region.\n\n\n\nAs Larissa Viana, chief executive officer (CEO) of APEXzymes, pointed out, biotech development is dependent on a collaboration between different sectors, starting with basic research, which, in Latin America, primarily comes from public universities. \n\n\n\n“Then, we need to connect potential results with the industries and the final receptors of the new scientific findings. This is possible thanks to venture builders, venture capitalists and grants from different institutions,” said Viana. \n\n\n\nThis sort of development scenario is currently on the rise in Latin America, and Viana believes it brings with it an optimistic future, with the transformation in investment in Latin America being spearheaded in particular by venture companies Zentynel (in Chile), GRIDX Exponential (in Argentina), and Vesper Ventures (in Brazil). \n\n\n\n“They play a very important role in finding promising research that can be turned into a highly technological startup to accelerate this transfer, so new therapies can find their patients, and new agriculture solutions can be applied on land,” commented Viana.\n\n\n\n“...And the more investment the region receives for this sector, the more we can accomplish and the more investors will keep an eye close to the opportunities presented here. This increase is the start we need to have the opportunity to establish the sector in the region.”\n\n\n\nPlus, alongside biotech, there appears to be an increasing amount of investment interest in Latin America’s deep tech scene.\n\n\n\nDeep tech investments on the rise \n\n\n\nAccording to a new report, entitled “Deep Tech: The New Wave”, there is room for a twentyfold increase in venture capital investment into Latin American - as well as Caribbean - startups over the next decade.\n\n\n\n“Investors across the world are starting to see the potential the region has, and we surely will see an increase in deep tech investments in Latin America, primarily focused on artificial intelligence (AI), IT and other technological developments,” said Viana.\n\n\n\nLatin America’s ‘Tech ecosystem’ was valued at $221 billion in 2020, and is actually expected to reach more than $2 trillion by 2030. And, with such an incredible influx of money, it could even help to transform the world through revolutionary technologies in climate action, healthcare, and infrastructure. \n\n\n\nBut why the sudden rise in deep tech investment in Latin America?\n\n\n\n“The main reason for this, I believe, is the sudden realization of how real the climate crisis is and how close to a no-return-point we are. Latin America has been a reference in sustainable and environmental topics for years now, especially due to our huge biodiversity and the presence of the rainforest. Naturally, this sudden crisis attracts attention to the region,” said Viana.\n\n\n\nAnother important factor, she added, is the conscious effort being made by different entities in the region: “Governments and many private institutions are focused on promoting the technological and industrial development of Latin America, as they see the value of the scientific findings we achieve, but often fail to put to use. We are about to change this, transforming our advances in real solutions through startups, instead of simply writing one more scientific article to be published and forgotten.” \n\n\n\nAn impressive number of biotech startups \n\n\n\nAccording to Viana, despite there being a few challenges holding developments back slightly - such as resistance from public universities to transfer their developments to the private sector, and a lack of diversified investors in the region - there are still an impressive number of biotech startups thriving in certain countries in Latin America.\n\n\n\n“As biotechnology development is highly dependent on an important amount of investments, the industry is better established where capital is available. So the main countries leading this growth are Argentina, Brazil, Chile and Mexico. From my experience as a biotech startup hunter in the past, I have seen a growing scene in Uruguay and Colombia as well, but at a more timid speed,” explained Viana. \n\n\n\nIn fact, according to Profissão Biotec, there are now more than 500 companies in Brazil alone, showing the considerable growth that is happening in the biotech sector in Latin America.\n\n\n\nFurthermore, these startups might even have a competitive advantage being located in the region; they are able to gain access to top scientists, hospitals and other resources for a fraction of the cost of a lab in the U.S., for example.\n\n\n\nBiotech investment in Latin America: still room for improvement\n\n\n\nHowever, certain challenges still remain before Latin America can become a fully-fledged investment hotspot for biotech.\n\n\n\nFirst of all, investors still see a certain amount of risk when it comes to investing in biotech innovation in Latin America, largely because the region is not that notorious for advances in the sector. \n\n\n\n“When you pitch your LATAM (Latin American) biotech startup to investors in the USA or in Europe, they will often ask you if there are any similar projects going on in these regions, as if we, in Latin America, could not possibly be the first ones to have conceived the idea,” commented Viana. \n\n\n\nGovernments are also slow in certain countries in Latin America to turn research into entrepreneurial initiatives. As an example, Viana said that the Brazilian government does not appear to have a strong intention to turn scientific research from public universities into entrepreneurial initiatives, meaning the country does not see as many successful results as it could potentially have.\n\n\n\nPlus, Latin America in general, has only really been focusing on its biotech sector for the last ten years or so, meaning that it has quite a bit of catching up to do.\n\n\n\nHaving said that, biotech investment in Latin America is definitely on the rise, and an increase in biotech investment in the region will naturally mean a direct increase in the development and success rate of startups in the sector.\n\n\n\n“...I am pretty optimistic about the next years to come. We are just now preparing the ground for huge success cases to take off. As soon as Latin American startups start getting FDA approval for their solutions, or hit U.S. $1 billion in valuation on an exit event, investors will start to pay real close attention to our scenario, and I believe we are a very few years away from this moment to happen,” said Viana.