Everyone is eager to see technology solving all the problems faced by humanity. But the response to this mass expectation has been dismal. Bio technology which is touted as the one stop solution for all problems is yet to prove its credentials in a big way. Its achievements so far cannot be belittled. However there is a big mismatch between the hopes and reality.

Along with the developments in bio technology there is a parallel growth of controversies. Especially the food products and medicines. It is up to the bio technologists to sort out these troubles and prove to the world that they are savious of future.

Kiran Mazumdar Shaw writes in The Times of India on 3 December 2009

Biotechnology is aptly described as the “technology of hope” for its promise to deliver food security, life-saving drugs, alternate energy and environmental sustainability. India has many assets in its strong pool of scientists and engineers, vast institutional network and cost-effective manufacturing. Over 100 national research laboratories employ thousands of scientists. More than 300 college-level educational and training institutes offer degrees and diplomas in biotechnology, bio-informatics and the biological sciences, producing nearly 5,00,000 students annually. About 3,00,000 postgraduates and 1,500 PhDs qualify in biosciences and engineering each year. According to reports, outside of the US, India ranks the highest with 61 USFDA-approved plants and in excess of 200 GMP certified pharmaceutical manufacturing facilities.

The Indian government’s national biotechnology development strategy is a comprehensive road map for this emerging sector. The document recognises the challenges of building both scale and critical mass in pursuing a global leadership profile. The biotech industry is poised to deliver a size of $5 billion by 2010 with biopharma driving the growth trajectory. However, funding, infrastructure, regulation and skill competency mapping pose obstacles in this path to the future. Conversely, India is uniquely placed to build a strong competitive edge. It offers an attractive cost arbitrage in research & development at roughly a third of that in the western hemisphere. Key enablers include a large, qualified English-speaking workforce, a network of reputed research laboratories and state-of-the-art pharmaceutical labs and manufacturing facilities. Further, the patient population offers a large, diverse pool for effective clinical research and development.

Ever-increasing cost and time involved in drug discovery and development, fierce competition and pricing pressure are all spurring western pharma companies to have an India strategy. A large number of blockbuster drugs are also set to go off-patent, giving the sector here tremendous opportunities. The industry is collaborating with global giants in clinical trials, discovery and development research, and manufacturing, thus rapidly moving up the value chain. In this age of hyper competition and wafer-thin margins, India’s biotech sector is poised at an inflection point.

Yet the industry continues to face numerous challenges. Foremost is finance. Venture funding has abstained from investing in this sector on account of its high risk profile. Aversion to risk is also seen within the sector, which prefers low risk ventures based on services and generics, shying away from an innovation-led business model. The department of biotechnology has plugged this deficiency through a number of funding schemes. It is for entrepreneurs to avail of these funds and rise to the challenge of innovation.

The sector also faces the same infrastructural hurdles affecting Indian industry. The country continues to fall short on critical enablers such as quality roads and uninterrupted supply of power and potable water. However, beyond these common issues, the sector has its own problems. It requires a streamlined regulatory framework to accelerate commercialisation of products. Numerous regulatory agencies pulling in different directions slow down the process of growth. Bt Brinjal is a good example of how years of intensive research investment are unable to guarantee commercial returns. Human clinical trials are still an unresolved aspect. Further, essential strong industry-academia connections are sadly lacking.

The government can lead the way in facilitating growth by treating biotechnology as a priority sector. R&D is the bedrock on which biotech rests. The government must enable international patenting, which curiously does not qualify for tax deduction, and encourage investment. A regulatory environment that helps the drug discovery process and approves products without delays is urgently required. A five-year tax holiday on new products developed in-house can be a great incentive for R&D. Profits on such products can be mandated for reinvestment in R&D to encourage development of newer and better drugs at lower costs.

The biotech sector needs creativity to harness its potential and assume global leadership. There exists a huge opportunity for growth but only if innovation becomes part of the business ethic and a primary enterprise driver. It is no longer enough to produce clones of pharma products that have saturated the market, which do nothing to add value. Benchmarks must be set high and out-of-the-box thinking must become the norm. Profit margins can be maintained through contract discovery and manufacturing for foreign firms.

Extensive research requires expensive equipment that needs to be imported. The government can step in again by exempting or reducing import duties. It can also approve the Association of Biotech Led Enterprises’s (ABLE) recommendation to set up a biotech fund to support first-generation biotech entrepreneurs up to the ‘proof of concept’ stage. ABLE has also urged the government to exempt venture funds investing in the sector from capital gains tax. That can act as a reward for longer-term investment cycles.

Already a major hub, India has all that it takes to become a global biotech leader. This will not only spur economic growth and provide much-needed jobs, but also ensure that we find answers to modern-day challenges in healthcare, energy, food security, and the environment. However, biotechnology’s promise and India’s potential can be realised only if government and industry work together and draw up a road map to facilitate innovation.

The writer heads a biotech company.


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