February 6, 2023

Futureality

Future Depends on What You Do

Lithuania Focused on Building a World-Leading Life Science Sector

In a compact laboratory on an upper floor of the Vilnius University Life Sciences Center is a biotech startup being held up as one of Lithuania’s growing success stories. Delta Biosciences, which is using microfluidics, DNA tags, and artificial intelligence to speed up drug screening, is hoping to start approaching European venture capitalists for investment next year.

The founders present their company with the energy and dynamism of stereotypical San Francisco technology entrepreneurs. Daniel Kratkovski, one of the co-founders, has a background in finance and investment. He and co-founder, Dominykas Milašius, say they came to Vilnius from London during COVID-19, inspired by what they say is a wave of change sweeping over Lithuania—especially the biotech sector.

“If you go into any tech park cafe, or even the cafes in the old town, there’s this crazy vibe in the air,” says Milašius. “Everyone is either talking about Ukraine or building a tech startup. I haven’t seen that anywhere else.” Or, as Alexander Morris, PhD, the British co-founder of another Lithuania-based biotech startup, puts it, “There’s something here that’s lacking in other European countries, the U.K. included.”

Lithuania’s growing ambitions

Milašius is keen to highlight that his biotech startup benefits from wider trends in Lithuania. He references a statistic that 2020 is the first time since the breakup of the Soviet Union when more people have returned to the country than left. The population decreased from 3.7 million citizens in 1990 to 2.8 million in 2021.

“Lithuania is stuck on a mindset of 2.7 million [citizens],” he says. “Now we think seven million because we have a diaspora of seven million. There are massive communities in the U.K. and Switzerland, and that unlocks a lot of doors.”

Patriotism seems to be a major factor in recent developments in the nation’s biotech community, and again, it reflects wider political trends. Since Lithuania gained its independence from the former Soviet Union in 1991, the country has been asserting a vigorous national identity—even down to reconstructing the entire Palace of the Grand Dukes of Lithuania in central Vilnius in the 2000s (Figure 1).

Figure 1. Palace of the Grand Dukes of Lithuania

This muscular pride in the nation has helped in building a strong technology sector in Lithuania. The government is focused on supporting four growth areas, including biotechnology and life sciences, according to Innovation Agency Lithuania, one of the government’s development agencies. Invest Lithuania, another development agency, notes Lithuania’s life science sector is the European Union’s fastest growing, contributing around 2.5% of GDP with an ambition to increase that to 5% by 2030.

Building on a long history

Lithuania offers a wide range of government support for life science companies. These include 20 years of corporate tax relief for capital investments, and seven Free Economic Zones with 0% corporate and dividend tax for 10 years or more.

Most of these programs are aimed at encouraging inward investment from large overseas life science and biotechnology companies, which makes sense as Lithuania’s largest taxpayer last year was American life science and pharmaceutical supplier, Thermo Fisher Scientific.

Thermo’s Vilnius site, which has 1,850 employees, manufactures reagents and consumables, with a focus on products for protein manufacturing, qPCR, cell therapies, next generation sequencing, and genotyping. The company has shipped a number of the first products for COVID-19 detection to China at the beginning of the pandemic and finished construction of a new 59,200 ft2 building in September 2020 for manufacturing mRNA and protein production supplies.

According to Justas Plankis, Thermo’s site leader and director of manufacturing operations, the Vilnius site was set up as an enzymology institute in the “old” Soviet Union in 1975, and became Fermentas International, a restriction enzyme manufacturer, in 1994. When Thermo Fisher Scientific bought the company in 2010 for $260 million, it was the largest business deal in Lithuanian history.

“Thermo Fisher noticed the potential [of the site] right after acquisition, and they’ve made an enormous investment [in] manufacturing expansion over the years,” says Plankis, adding that although the site is known for protein manufacturing, they’ve since added additional competencies.

From restriction enzymes to CRISPR

The presence of Thermo and the long history of protein research at Fermentas and the enzymology institute have had a visible impact on the culture and skill sets of Lithuanians in Vilnius. According to Invest Lithuania, 56% of the population has a higher degree (second in the EU) with 25% of students choosing a STEM academic discipline (again, second in the EU). For reasons that never become clear, despite asking lots of questions, almost two-thirds of Lithuanian scientists and engineers are female.

Lithuania’s most famous contemporary scientist Kavli Prize laureate Virginijus Šikšnys, PhD, chief scientist and head of the department of protein-DNA interactions at Vilnius University, who is widely credited in Lithuania to have been scooped for the discovery of the pivotal CRISPR-Cas9 gene-editing technology after Cell rejected his paper.

According to Šikšnys, CRISPR was the “logical development” of Lithuania’s history and expertise in protein production. “[Fermentas] became a big production site for restriction enzymes to be distributed all over the world. This allowed Lithuanian scientists and researchers to gain the necessary protein production skills.”

Šikšnys co-founded the gene-editing company Caszyme in 2017, which is among Lithuania’s better established biotechs. The company manufactures CRISPR-Cas proteins with different characteristics as a molecular tool the life sciences, including industrial biotech. The company says it offers a library of more than eighty Cas9 orthologs. These include smaller Cas proteins for efficient delivery by adeno-associated viruses (AAVs), which have human therapeutic applications.

Caszyme also is now developing CRISPR-Cas12 proteins, which are smaller in size and introduce a double-stranded break into DNA by a different mechanism than Cas9 with different potential applications. Caszyme has visibly outgrown its space in the biotech incubator at the Vilnius University Life Sciences Center (Figure 2) and is working to move to new premises.

Figure 2. Vilnius University Life Sciences Center

A major historical inspiration

The Thermo Fisher Scientific site serves as a source of supporting science in the local community. It partners with local universities, including Vilnius University, gives guest lectures, runs internships, and collaborates with a volunteer-led mobile bioscience lab where high-school students can run simple experiments to find out, for example, whether an onion is genetically modified or not.

But the company’s role as a driver of Lithuanian biotech is a result of being “a big player within the local economic environment,” as Plankis puts it. For biotech startups, Fermentas is a major inspiration. “Every young tech entrepreneur looks at [the history of] Fermentas and hopes to do the same in the next couple of years,” Milasius says.

Both Milasius and his co-founder came to Lithuania from London. Among the factors encouraging them to relocate was the reverse of Lithuania’s historical “brain drain” with scientists joining them from the University of Geneva in Switzerland the Crick Institute, and the University of Cambridge in the U.K.

Another factor is the lower costs of founding a startup in Lithuania. Genie Biotech is fitting out its laboratory in the Centre for Innovative Medicine in Vilnius, where they’ve been for about six months, after deciding turn-key laboratory and incubator space in London was too expensive. The company, which is using Click Chemistry to develop a site-specific conjugation technology called GenieTAG™, is hoping their early-preclinical-stage technology will eventually find applications in vaccine production.

The GenieTAG is a fusion protein that can be used to attach other proteins together, such as decorating a virus-like particle with parts of the SARS-CoV-2 viral protein to create a synthetic COVID-19 vaccine or—potentially—a prophylactic cancer vaccine. According to Grigorij Sutov, PhD, Genie’s CEO, the tag has robust chemistry, slowly dissociates over time for controlled drug release, and benefits from being smaller (200 Dalton) than other conjugate chemistries. “The bigger it is, the more chance of a [negative] immune response,” he says.

Creating an ecosystem

Lithuania also benefits from an emerging “biotechnology ecosystem,” according to Milašius, with companies, such as Caszyme and microfluidics instrument manufacturer, Droplet Genomics, coming onto the scene.

Delta Biosciences is using a Droplet Genomics instrument, which they cheerfully demonstrate, to run their screening tests. The aim of the company’s technology is to accelerate drug discovery by running drug candidate screening experiments in pico-sized droplets, instead of in 96-well plates. Two streams of droplets, one containing a target and the other a candidate molecule with a DNA carrier tag, are encapsulated in the same bubble on which screening experiments can be performed. According to the company, they can experiment on 500,000 droplets a day—the equivalent of one technician pipetting 50 droplets every second.

Providing a service

Like Fermentas and Thermo, many Lithuanian biotech startups appear to be service companies aiming to sell products or license out technology. For a few of them, the need to secure funding is the key driver.

According to Rytis V. Urbonas, PhD, co-founder and general manager of Sanobiotec, a Lithuanian manufacturer of minor cannabinoids for medical and well-being applications. “Our goal was making revenue and finding a product we could sell as fast as possible, as we don’t have the same possibilities as in the U.S. where you get $20 million in pre-seed funding. Here you get 200,000 Euros and, you know, you should be happy.”

Many of the startups interviewed seem to rely heavily on the enthusiasm and support of their founders for financing. Officials at Delta Biosciences, for example, say they were initially seed-funded by the founders. Genie Biotech reports receiving 30,000 Euros in Lithuanian government funding, but most of the “skin in the game,” as Morris puts it, remains theirs.

According to Innovation Agency Lithuania, the country is middle ranking for GDP among EU countries, with only 7% unemployment. But reputations die hard. As Karolina Makovskytė, business development manager at Caszyme says, “We’re a small company in a small country—we have to reach out to be seen.”