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Checkbiotech: A suitable pair of genes
Posted by: DR. RAUPP ; madora (IP Logged)
Date: March 31, 2005 07:04AM ; ;

Let's start with a startling fact. As a business segment, biotechnology has
the potential of generating revenues of $5 billion and creating one million
skilled jobs over the next five years through products and services. This
can propel India into a significant position in the global biotech
sweepstakes, March 2005 by Kiran Mazumdar-Shaw.

Way back in 1986, biotech got its first push when the government set up a
dedicated Department of Biotechnology that had the well-defined objective of
establishing several centres of excellence?research and academic
institutions focused on biotechnology-based programmes. Universities were
also encouraged to introduce both graduate and post-graduate specialised

These initiatives provided a strong foundation and the skilled resource pool
that is vital in creating a sustainable business in a state-of-the-art field
like biotech. We now have 40 national research laboratories employing 15,000
scientists. There are more than 300 college-level educational and training
institutes across the country offering degrees and diplomas in
biotechnology, bio-informatics and the biological sciences, producing nearly
three lakh students on an annual basis. More than 17,000 medical
practitioners come out of 100 medical colleges in a year and nearly one lakh
post-graduates and 1,500 PhDs qualify in biosciences and engineering.

Despite these advantages, the lack of financial support forced early biotech
companies to adopt services or generics products as a business strategy.
Biocon, for example, started with a strong R&D focus on enzymes, leveraging
India's low-cost advantage.

Shantha Biotech opted for generic Hepatitis-B vaccines. From this modest
base, the sector has gradually built critical mass both in terms of
infrastructure as well as markets.

India is also rapidly gaining a global vantage position in biogenerics.
Biocon and Wockhardt, between them, can address Asia's insulin requirements.
In agri-biotech, India has the potential to be a leading supplier of GM
seeds to the world.

Pharmacogenomics is a rapidly growing segment that provides a wealth of
information pertaining to defective or missing genes which call for
differentiated medicine?a new avenue for drug research. This emerging
discipline combines both infotech and biotech skills in augmenting
high-speed data mining of both genotypic and phenotypic information with a
view to evolving new forms of medical diagnostics and therapies. Genomics
and Proteomics are churning out endless reams of data which need to be
statistically evaluated and harnessed for commercial end use. The new
medicinal approach to disease management looks at disease as a process and
not a state, where tracking disease progression will allow for therapy. Gene
regulation and other bio-algorithms will form the core of a new wave of
diagnostics that are now being referred to as 'theranostics'.

India can position itself as the hub for differentiated medicine as the
country offers one of the most affordable development bases for personalised
medicines. Personalised therapies will demand extensive clinical data
generated from well-differentiated patient populations. India and China are
the two countries with the most desired disease and patient profiles that
can enable such studies. Coupled with this is the need for a large number of
novel diagnostics based on gene and non-gene based platforms. These are
clearly large opportunities for Indian biotech companies to pursue.
Personalised drugs also address the affordability factor for expensive
therapies such as those involved with cancer.

Bioinformatics is another segment that offers the most attractive innovation
and discovery opportunities for Indian companies in designing new drug
molecules, mining novel bio-markers, generating new pharmacogenomic data and
generating high-value medical wisdom.

Custom research is a services model that most Indian biotech companies have
opted for at their start-up stage since it earns early revenues with which
to fund infrastructure and scientist salaries. These companies harbour
ambitions of original R&D once they reach a certain profit level. In 1994,
Syngene, a company promoted by Biocon, became the first such custom research
company. Aurigene, Genotypic Technology, Chembiotek, Cytogenomics and
Jubilant Biosys are other good examples of such service-based biotech
companies. This segment is expected to generate revenues of over $1 billion
by 2010.

The opportunity for international bio-partnering is a fallout of the trend
of declining risk capital in the West which seems to have dried up for
companies engaged in early-stage discovery work. Venture capitalists seem
willing to fund only companies that have reached the post proof-of-concept
stage. Thus there exists a large number of companies whose resources are
simply too frugal to take their ideas to the next stage. Indian companies
would be their natural collaborators to reduce burn rates, optimise R&D
spends and extend survival timelines. An "India strategy" offers an
effective de-risked model for VCs who are in dire need for exit or survival
strategies for their investees.

To the biotech companies, an 'India strategy' offers a lifeline for product
development and the most affordable and effective way to move up the value
as well as valuation curve. International bio-partnering has already gained
visibility in India and several collaborative partnerships have been
initiated such as Biocon's JV with Cuba's cimab and its investment cum
co-development programmes with Nobex & Vaccinex to develop proprietary
products. Chiron's recent predicament with respect to the acute shortage of
Flu vaccine has prompted alliances with Panacea Biotech and others. Serum
Institute, Bharat Biotech and others already have ongoing arrangements with

Although Indian biotechnology has received global recognition for its
biotech capabilities, government policies have thus far lagged behind. The
British government has recently announced a ?1 billion investment in
biotechnology over the next three years. Prime minister Tony Blair
acknowledged that this initiative was influenced by the tremendous progress
made by the Indian biotechnology sector. Ironically, the biotechnology
sector in India has been built not by pragmatic government policies nor
through dedicated investment but by daring and persevering entrepreneurs
with frugal resources. It's only now that this success has been recognised
and the ministry of science & technology has now mandated the Department of
Biotechnology to draw up a pragmatic policy.

This year's budget is also quite 'pro-bio', promising a favourable fiscal
and regulatory policy environment. The budget focuses on significantly
raising investment in R&D as well as in academic infrastructure. Even the
proposed National Biotechnology Policy is expected to provide the
much-needed funding for incubating start-ups and supporting product
development. Given the right impetus, companies like Biocon could easily
rank among the top 10 biotech companies globally by 2015 and India could
position itself as the preferred global destination for biotechnology.


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