Interferon is any of several types of proteins produced by the body’s cells to fight against viral infections and tumours. Although the discovery of interferon in 1957 is linked to the efforts of Isaacs and Lindenmann in the UK, its presence was first observed by Japanese virologists, who serendipitously stumbled on a ‘viral inhibitory factor’ while attempting to produce a more efficient vaccine for smallpox. They conducted the earliest research on this VIF, but because their work was published in French it did not reach a wide audience. Later, in the 1960s, when pharmaceutical preparations of natural or synthetic interferon became feasible, the world’s media heralded the development of this drug, which was thought to be a remedy for all kinds of ills by boosting the body’s natural defences to destroy viruses. In particular, interferon was seen as a wonder drug for the treatment of cancer. One of the pioneers in developing this new drug, and the first company in Japan to do so, was not a conventional pharmaceutical company or a biotechnology start-up firm, but a long-established manufacturing company in the textile business. Toray, a company synonymous with the production of rayon (and, subsequently, nylon and polyester) had recently embarked on a journey to diversify into new strategic industries, and it latched onto the announcement about interferon, which it saw as a means to develop a biotechnology group and produce interferon for the Japanese market. Toray had some modicum of prior experience in the nascent biotechnology business. Shortly after the Second World War, a number of Japanese non-pharmaceutical companies, including Toray, began to synthesise penicillin because of the demand to treat bacterial infections such as septicaemia, syphilis and gonorrhoea. Toray developed deep-tank fermentation as a means to scale-up production of penicillin. Although Toray ceased penicillin production after a few years, because many other companies supplied it, it retained a core group of scientists with knowledge of fundamental techniques who formed the basis of its later efforts in interferon. This paper traces the story of how Toray first became aware of the potential of interferon, why it entered the biotechnology business, and how it developed the first interferon drug for the Japanese market. It benefits from interviews with research scientists and managers in Japan as well as use of secondary data.