India’s rapidly growing biotechnology industry badly needs funds, specially at the early stages of developing new drugs. It needs to begin filing more original patents in new drugs too, says a new study Beyond Borders Global Biotechnology Report published by Ernst & Young.
“Funding of early-stage startups remains a serious issue for the sustainable development of the industry. In India, biotech investment will primarily be from the pharmaceutical investors,” said Utkarsh Palnitkar, partner, E&Y.
However, the report also adds that early trends point to the possibility of India following the path of Japan and moving up the value chain of developing new drugs.
The Indian biotechnology market will more than double till 2015, growing from $6 billion at present (Rs 24,600 crore) to $15 billion (Rs 61,500 crore), the report says.
It notes that 789 research papers came out of India on biotechnology between January 1, 1996 and August 31, 2006. In comparison, in the same period, 37,822 papers were published by United States scientists, 2,273 by Australian scientists and 1,481 by Chinese.
The figures are a measure of how many doctorates are coming out of a particular country. This might explain why despite a 30.4 per cent rate of growth in submitting papers, India contributes a mere 0.8 per cent in terms of value generated by patents filed, the report says.
Indian biotechnology is still funded mostly by the pharmaceutical industry, whose major focus is on cheap drugs where profits are low. This means money is difficult to come by. Biologic drugs often have significantly higher prices than their small molecule counterparts, said the report.
However, the only exception in developing new drugs is Biocon. It has co-developed Biomab-Egfr with Cuban Centre of Molecular Immunology (CIMAB).
The government is trying to help the biotechnology industry. India’s National Biotechnology Development Strategy, submitted for final approval in 2006, calls for intellectual property (IP) incentives, tax concessions, and grants to support the sector.
The foreign investment community has taken note of all this. “Foreign investment community has reacted favorably to the report with positive reviews,” said Palnitkar.