Emerging Lithuania

Life-sciences industry leaders - including a large Israeli contingent - gather in Vilnius to explore the future of biotech in a forum organized by Enterprise Lithuania with help of Israeli applied knowledge center Bioforum.

By ERICA SCHACHNE
Biotech conference (photo credit: Courtesy Enterprise Lithuania)
Biotech conference
(photo credit: Courtesy Enterprise Lithuania)
Israel is known around the world for its flourishing hi-tech industry, its ideal conditions for biotechnology development and for being an agricultural biotechnology leader. Who has not heard about the Jewish state’s astounding development, as famously described in Start-Up Nation? But what were 110 Israeli leaders in the life-sciences field doing on an El Al plane to Vilnius on a late summer morning?
It is true that many prominent Israelis such as Defense Minister Ehud Barak and Israel Bank governor Stanley Fischer descend from “Litvaks,” Jews who hail from Lithuania – a thriving center of Jewish scholarship prior to the Holocaust. However, Lithuania is less well known as a biotech hub.
Life Sciences Baltics 2012, held last month in the Lithuanian capital, set out to change all that. The first international life-sciences forum in the Baltics, it was organized by government agency Enterprise Lithuania with the aim of attracting scientists, manufacturers and service providers from all over the Baltic states, as well as global business leaders, to strengthen partnerships between them and promote international cooperation within the biotech sector.
Conference attendees learned that not only did Lithuania experience approximately 3 percent GDP growth in 2012 thus far – high compared to the rest of Europe – but the biotech and pharmaceutical fields are growing by 22% a year, with 90% of the country’s biotech products being exported, to the tune of over $100 million.
Lithuania, which is said to be especially strong in the development of reagents and enzymes for molecular biology, opened its first multipurpose biopharmaceutical production facility in the early 2000s, and had its first biopharmaceutical product approved for human use by the US FDA in 2012.
The government is now investing hundreds of millions of dollars in the development of five “research valleys,” with the focus including biotech, medicine, nanotechnology and lasers. Lithuania predicts that by 2020, biotech will move from 1% to 2% of its GDP. The other Baltic states are also part of this trend. Latvia has focused on the use of stem cells and cancer drug development, while Estonia has invested significant state support in the field, despite the economic crisis.
In seeking to accelerate its growth, Lithuania has made a major effort to collaborate with Israel. In pursuit of that goal, the government sponsored the Israeli conference contingent, making arrangements for a separate El Al flight. Indeed, in a special welcome to Israeli delegates which included Vice Minister of Economy Giedrius Kadziauskas, Lithuania’s Ambassador to Israel Darius Degutis called the Jewish state a role model, saying the idea for the conference was born at the Israel Life Science Industry-Biomed Conference in Tel Aviv in 2010.
While Israel did not win any medals in the London Olympic Games this summer, it has been a winner in the “chemistry Olympics,” he noted. Lithuanian Prime Minister Andrius Kubilius echoed this in his remarks to Israelis via video, stressing the enormous potential for collaboration between the two countries.
BIOFORUM, a leading Israeli applied knowledge center that provides a range of education, training and consultation services to the biotechnology, pharmaceutical and medical device industries, worked with Enterprise Lithuania to help develop the conference, flesh out the theme and select the more than 50 speakers.
Yehudith Wexler, chairwoman of Bioforum, said that unlike other conferences, Life Sciences Baltic’s goal was not commerce – buying and selling. Rather, the organizers made it clear to the Israeli participants from the beginning that it was an opportunity, a clean slate.

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Come with a clear head, she said they were told, for the purpose of seeing what is possible.
Governments and scientists always have divergent objectives, she explained. While states want to focus on industry, scientists “live in a world of their own” and exist to do research and put out papers. Melding the two was the challenge. Bioforum, Wexler said, sought to enlighten Lithuania, Latvia and Estonia as to how other nations build industry – on the local, regional and countrywide scales. Their multipronged approach involved many prominent speakers; learning – actual science, research findings, pharmaceutical developments and technology; and “making industry happen” – with presentations on economics, regulatory considerations, clinical trials, quality management, logistics and infrastructure.
They accomplished this, according to Wexler, by employing different elements in building the event: the actual conference; an exhibition of leading Baltic biotech companies at over 40 booths; business-to-business sessions, with any relevant organization having the opportunity to present for the full three days of the conference; presentations on how specific countries had cultivated industry, including institutions in countries such as Singapore, the Netherlands and the US; and site visits to bodies such as Vilnius University Hospital and Vilnius-based companies such as Moog Medical Devices.
Bioforum utilized professional social networks such as LinkedIn to help bring in participants from all over the world, including the US and Russia, Wexler said.
It also ensured that Israeli delegates attended presentations by Baltic representatives (such as the “Estonian Nationwide Health Information Exchange Platform” talk given by Dr. Peeter Ross of the Estonian eHealth Foundation and East Tallinn Central Hospital), and vice-versa (with Baltic delegates attending talks such as “Meet the Regulator,” which was moderated by lawyer Yoel Lipschitz of the Israeli Health Ministry). Many students from the Baltic States were also present, including Lithuanian medalists in the International Chemistry Olympiad for high-school students.
Moreover, to give participants a sense of what it really takes, Bioforum enlisted those from the Israeli science world with the economic power to actualize. They included Dr. Nissim Darvish, senior managing director at the OrbiMed healthcare investment firm, who spoke about the venture capitalist vantage point, and Rina Pridor, former director of the Israeli Program of Technological Incubators, who spoke about incubators as a national catalyst for the life-science industry.
Lithuania gave them a lot of latitude and had only a few specific requests, Wexler said. They wanted a Nobel Prize-winner who could open the conference plenary – provided in Prof. Ada Yonath, who won the 2009 chemistry prize for the study of ribosomal structure and function – and they wanted a biotech leader on the business side – provided in Prof. Michel Revel, an expert in stem cell research and its application in medicine.
Yonath was indeed a huge conference draw. Her plenary, “Crystalization of Ribosomes: Wishes & Experience” cited countries that are healthiest in terms of life expectancy for those of all ages, including Canada, Iceland and Japan. Yet increase in average life expectancy throughout the world is statistically lower than expected, and this, she explained, is due to resistance to antibiotics.
Yonath called on pharmaceutical companies to make a serious commitment to produce effective antibiotics.
The industry currently prefers not to produce these drugs, she said, because it is a lengthy process and the end results are not as good a moneymaker as other drugs. But if the pharmaceutical industry does not do so, the world will go back to the pre-antibiotic era within 20 years, she warned.
As to future developments, scientific, pharmaceutical or otherwise? Yonath said she does not know, since she is not as clever as the bacteria.
ONE PERSON who does have a clear vision for the future is Vilnius Mayor Artūras Zuokas. Famed for a viral YouTube video in which he mowed down an illegally parked car in the city center with a tank, the charismatic Zuokas has more ideas up his sleeve.
Currently in his third term as mayor, the head of the YES political party and former war correspondent said Vilnius has many aspects that make it a city to watch. But because Lithuania was part of the former Soviet Union – with Lithuanians at the forefront of the Perestroika movement that eventually dissolved the union – Zuokas said visitors expect it to be Soviet and gray.
Instead, they are surprised to find the “Mediterranean of the Baltics,” whose people “work precisely but enjoy life.”
Vilnius was historically very important for a number of populations, including Russians, Scandinavians, Poles and Jews, Zuokas explained, and is located at what is still considered a strategic point for many Europeans. Investors will benefit from the modern-day city’s dedicated labor force, he said, which is largely young and educated – with 90% of the population going on to secondary education, and 40% earning a college degree or higher. Many of them speak at least one foreign language, commonly English or Russian.
Zuokas also pointed to the city’s good infrastructure, its strong investment in hi-tech and ICT infrastructure – Vilnius has the fastest Internet in the world – and its efficient bureaucracy that allows companies to get to work quickly. An example he offered was IKEA, which will open in Vilnius in 2013 and was granted a permit to start work six months from the time they came to his office. This, the mayor said, is unprecedented in comparison to other cities.
To further improve Vilnius, Zuokas has been exploring ways to increase the quality of public transportation with a light rail and electric buses, and will be building a factory for waste recycling and employing a private company to modernize the citywide lighting system. A new state museum of the Hermitage is also planned.
Much of Zuokas’s strategy employs provocative social change. In addition to his unorthodox approach to parking, the mayor has made it illegal for residents to give money to panhandlers.
“You think you are helping them, but you are really keeping them on the streets. Better to donate money to nonprofits,” he said.
To that end, he has distributed special cards to restaurants, hotels and other places the homeless seek charity, with information on free food, shelter and social services.
MILDA DARGUZAITE – managing director of Invest Lithuania, the sister agency of Enterprise Lithuania – concurs with Zuokas about her country’s potential. Princeton-educated, she moved back to Lithuania last year after 17 years abroad – 16 of those years in the US, where she worked on Wall Street. Recruited by the minister of economics, Darguzaite works to attract foreign direct investment.
Her biggest challenge, she said, is that her country is not well known among venture capitalists. Indeed, she said people do not recognize the incredible progress Lithuania has achieved in the relatively short period since its independence in 1990. Moving from a Soviet centralized economy to a complete market economy, it is now the 11th freest economy in Europe, and the 23rd freest economy in the world.
When it first became independent, Lithuania was the only growing economy in the former Soviet Union, Darguzaite explains, with virtually no unemployment.
Then, in 2009, the economic crisis hit and it suddenly went into one of Europe’s deepest recessions. Suffering from the stoppage in lending and decline in exports, the country had a 15% drop in GDP, with unemployment soaring to 18%.
But Darguzaite said that out of catastrophe came opportunity, and what she characterized as Lithuania’s dynamic nature came through. Without the impetus of riots or demonstrations, instead utilizing discussion and negotiation, the government “reacted surgically,” she said. It quickly instituted a series of reforms to balance the budget deficit, raising taxes and cutting salaries.
The EU also provided structural funds to raise productivity, and exports started growing. Now, Lithuania’s GDP is at a healthy level, Darguzaite said, with real GDP growth at 1.4% in 2010, 5.9% in 2011 and estimated at 2%-3% for 2012.
She points to this resiliency on the part of the government and the people as one of the strongest factors that should attract investors to Lithuania.
DESPITE ALL the work the Lithuanian government is putting in, and its eagerness to collaborate with Israel, many Israelis are not so convinced. One Israeli conference attendee characterized Lithuania as “developing into a developing country,” and this reporter heard the opinion expressed many times that Lithuania has much to learn from Israel, but Israel does not have much to learn from Lithuania.
However, Prof. Joseph Press, director of Schneider Children’s Medical Center in Petah Tikva, clearly recognizes the potential – and possible threat – Lithuania represents.
The Kovno-born physician has been a leader in Israeli medicine since he made aliya in the 1990s, formerly serving as Pediatrics Division chairman at Soroka Medical Center in Beersheba. He said that in his experience, especially from his current position of director and head of Schneider’s research institute, he strongly believes that research means the difference between a good and excellent medical center. Press is very concerned about why Israeli bioscientists are increasingly leaving Israel and looking toward Eastern Europe as the base for their research.
Having come to the conference in large part to understand the Israeli motivation for leaving Israel, Press said he realized it does make sense.
This is because research costs in Eastern Europe are much lower than in Israel and the rest of Europe, with no sacrifice in quality.
This was evident during the conference site visit to Vilnius University Hospital, he noted, where he learned that they have some of the most developed lab equipment in the world. Press also said he found the Lithuanian people to be a good match for Israelis, in the sense that they are very eager to learn and develop, and are very highly educated.
Press said he finds this very worrying. With Teva Pharmaceuticals already in Lithuania, he foresees other such established companies, as well as startups, moving their operations from Israel to Eastern European countries – which will welcome them with open arms and attractive tax incentives.
Israeli hospitals would then suffer from the lack of clinical researchers, he said.
Press was adamant that the government must pay closer attention to this issue and invest in its scientists, ensuring they stay in Israel. If it does not, he cautioned, the country will suffer in myriad ways, including lack of improvement in current medical services, and lack of innovation and development of new services and equipment.
SO WILL Israelis increasingly do business in Lithuania? And did the conference fulfill Bioforum’s objectives for equipping the Baltic states to build industry? You can lead a horse to water, Wexler said, but you cannot force it to drink. The forum armed participants with knowledge to help create a thriving life-sciences sector, and facilitated over 1,000 meetings between science and business representatives from all over the world. Now it was up to the Baltics to put this into action, she said.
No matter what, Wexler said, there was no doubt about how seriously Lithuania takes its commitment to become a biotech leader. This sentiment was repeated by a number of Israeli delegates, who also said the effort that went into planning the conference was evident and had borne fruit in the breadth of topics, speakers and participants.
Interestingly, an unanticipated success of the conference was the networking that took place among the members of the Israeli contingent, who said they do not usually have the opportunity to spend three uninterrupted days with other leaders in their field. They felt that through the forum, they had forged a number of meaningful connections with their Israeli colleagues that might result in future collaboration and partnerships.
In any case, it is evident that Lithuania, which is set to assume the presidency of the Council of the EU in the second half of 2013, is growing dynamically – with or without Israeli contributions. So is it a potential powerhouse? Only time will tell. One next step was delineated by the huge banner at the airport as delegates made their way home, which read “See you at Biotechnology 2014!” This is certain, however: if the country has its way, the whole world will know where to find Lithuania on the map.
An Israeli's Lithuanian odyssey
Haim Ariel, the honorary consul-general of Lithuania in Israel and the Israeli representative at government agency Enterprise Lithuania, has an amazing story about how his family history led him to his active role in Israeli-Lithuanian relations.
Ariel’s family, originally from Vilnius (then known as Vilna), was deported to Siberia by the Russians. His father ultimately emigrated to Palestine in 1933, and his family became well-ensconced in Israeli life. In 2001, in the course of his work, Ariel met with the South African ambassador, who knew of his Vilnius origins and introduced him to the first Lithuanian ambassador to Israel. The ambassador offered him the post of honorary consul of Lithuania, which he took up that November.
Ariel said that despite having grown up in Israel, when he came to Vilnius for a visit he felt like a native – he knew where all the Jewish locations and buildings were. Shortly thereafter, the Lithuanian ambassador called and asked him to come to the embassy in Tel Aviv right away – as he had to tell him something in person.
When Ariel arrived the ambassador took out a file full of old Jewish documents. It emerged that the ambassador’s wife had been in Vilnius and renovations were being done at a building across the street from where she was staying, on the floor above a café. Breaking down a wall, the construction workers had uncovered the sheaf of Jewish documents, which they gave to the café owner, who then gave them to the ambassador’s wife. The ambassador said he wanted to pass the documents on to Ariel, since he knew Ariel had been named after someone who had died in the Holocaust.
The documents included the passport of a man named Haim Pupko. That was his full name, (Haim) Ariel explained, before his family had changed it to an Israeli name. Through research of his family tree, Ariel discovered that Haim Pupko was a cousin of his grandfather.
Pupko, he learned, had escaped Vilnius during the Holocaust with the help of Chiune Sugihara, the Japanese vice-consul in Lithuania at that time. Sugihara helped several thousand Jews leave the country by issuing transit visas - with Pupko escaping via Dutch Guiana in the Caribbean, today known as Suriname. It turned out that all of the documents given to Ariel were from Jews who had written to consulates asking for help, and were saved by Sugihara – who ultimately died penniless and was finally honored posthumously by Israel in 1985 as Righteous Among the Nations.
Ariel and his family had thought that Pupko died in the Holocaust along with other family members - but it was suddenly clear he had not. Pupko and his sister, they learned, ultimately settled in New York but did not know about their family in Israel, and had died two years before Ariel received the documents that would impact his life.
In 2004, Ariel and his wife took 17 second- and third-generation cousins on a trip to Vilnius to explore their roots. They got a surprise the day they landed – Valdas Adamkus, who served as Lithuanian president from 2004 to 2009, invited them to the presidential palace for a special welcome.
That was not the only surprise the trip had in store. In what Ariel considers divine providence, his family was caught in a rainstorm one day and looked to take refuge in a cafe. Being a very large group, they were turned away from a number of places, but were finally welcomed into one café’s courtyard. When Ariel’s wife and a cousin went inside, they discerned that it was in fact the café where the documents that meant so much to his family had been found.
Upon finding out the story, the café owner took them up to the second floor and showed them the hole in the wall where the documents had been found.
Now, Ariel told this reporter in Vilnius, he feels the story has come full circle – with 110 Israelis visiting for the life science conference.