Rolling Indian biotech attracts EU attention

Image courtesy Biocon (www.biocon.com)

Naturally, the optimism was palpable at the BIO 2006 conference in Bangalore last week. What was equally noticeable was the number of overseas participants – in particular from the EU – that are anxious to get in on the action.

More than 75 biotech firms from over 25 countries participated in the event, but it was clearly the European Union - represented by four ambassadors from the UK, Sweden, France, and the Netherlands, and led by the minister counsellor of science and technology from the European Commission, Andrew Sors - which was leading the pack of international suitors.

Currently, Indian biotech industry has a modest $1.45 billion in revenue, but this puts it well on track to cross the targeted $5 billion revenue by 2010. But it is the assortment of opportunities, both in business and research, that makes India an attractive destination.

Pharma revenues

The bulk of the sector’s revenue this year came from biopharmaceuticals, with three the three categories of vaccines, therapeutics and diagnostics, accounting for over $1 billion in sales, of which exports amounted to $560 million. Bio-services and Bio-industrial sectors are other high growth segments growing at over 70 and 17 per cent, respectively, according to a new industry survey released at the conference.

And while the investment hasn’t flown particularly thick and fast, it grew to over $360 million in 2005. The fledgling industry, hardly 6-years old, added 28 new firms last year. This brings the total to 326, more than half of them in Bangalore.

BIO 2006 saw some soul searching. “There is still very little discovery-led research. We need to focus on clinical research more, as clinical data generated here is now gaining more acceptance overseas,” said Kiran Mazumdar Shaw, chair of Biocon, the India’s largest biotech company.

At the show Biocon announced regulatory approval for its monoclonal antibody for cancer – BioMab EGFR – India’s first indigenously developed monoclonal. The drug will hit the market in three months, bringing a boost to a sector that is just about managing to steer towards more innovation-based products and diagnostics.  

EU woos Indian biotech

The large delegation at the conference was not the first overture the EU has made to Indian biotech. As part of attempts to woo researchers around the world to participate in the Framework Research Programme 7, beginning in 2007, the EU set up a science and technology counsellor’s office in New Delhi last November, headed by Andrew Sors.

“We want the best team from India to participate in the Seventh Framework Programme,” Sors told delegates, adding that the significantly increased budget of €55 billion offered plenty of scope for Indian participants.

The response of M.K. Bhan, Head of the Federal Department of Biotechnology (DBT) in New Delhi, to Sors’ invitation gave an insight into the government’s ambitions for the sector. Bhan said the India-EU partnership should be a strategic, EU-backed collaboration rather than an individual, isolated-lab driven partnership. He noted that India already has several collaborative research programs with countries in Europe, including 14 with Switzerland.

“We are replacing earlier, sporadic, academic partnerships with a strategic partnerships which will be backed by solid management,” said Bhan. As a role model he cited the relationship between DBT and the US National Institutes of Health under which the DBT has entered into special funding and logistical arrangements, leading to several research initiatives between the two countries.

Bhan also sprang a surprise on the EU delegation, asking them to come forward with, “ambitious partnerships, which India was willing to sit across the table and discuss”. He called also for more industry-to-industry partnerships between the two regions. EU and India should visualise goals and concurrently work together with enterprise-based research topped by intellectual property and corporate-style management.

Sors was surprised by DBT’s official position and he couldn’t hide it. “You spoke to us rather directly, Dr Bhan,” he said, adding that he would bring up Bhan’s views at the Commission.

DBT probably has a reason to be direct as it strives to open up India’s notorious bureaucracy and speed up the functioning of various offices within the government. “Global best practices will not come into India without your pressure and feedback,” Bhan told the EU delegation.

Due diligence for Indian biotech

Notwithstanding the encouraging growth rate, the Indian biotech industry has several holes to plug before it can aspire to become a leading player in the Asia-Pacific region. The country’s much-talked-about large pool of human resources does not suffice for this industry, which needs specialised skill-sets to deliver innovative products. While the industry has been crying itself hoarse over this issue for some years now, the gap in talent came into sharp focus with two industry reports. The first from Yes Bank, and the other from Bangalore-based human resources consulting firm, Leader Prospects, revealed an absence of  “foundation knowledge” in basic sciences.

“There is a lack of innovation and entrepreneurial culture in academic institutions. Research collaborations, critical to an effective ‘Industry-Academia nexus’ are largely absent. Research investments of corporates are not necessarily aligned to the research collaborations and initiatives of  academia,” says the report from Leader Prospects. “Government interference was found to be more restrictive than conducive in nature towards fostering the growth of the academia.”

Another thorny issue is sluggish investment. To overcome this, Aditya Sapru, Frost & Sullivan’s Managing Director for South Asia & the Middle East, suggested that Indian biotech firms should try to replicate successful global models for attracting investment, focusing on “building critical mass by geographical expansion, acquisition of specific portfolios and leveraging Indian intellectual capital and infrastructure”. According to Sapru, the six existing biotech parks, along with 10 others at different stages of development in various parts of the country, should be leveraged for attracting investment.

Overall, the Bangalore event was a good showcase for Indian biotech – but it remains to be seen how much is translated into business deals.