Reliance Life Sciences (RLS), the pharmaceutical and biotechnology business arm of the Mukesh Ambani group, is planning a fund to nurture start-up biotechnology companies in India.
As a first step, RLS has entered into an agreement with MPM Capital, the world’s largest venture capital firm investing in biotechnology companies. Dr David Baltimore, who won the Nobel Prize in medicine for the year 1975, is one of the advisors to the fund.
Investing in small companies will also open a vista of new opportunities for RLS. The company would have the advantage of benefitting from the results of the innovations made by these companies, with a fraction of the investment required for them. New drug research in biotechnology is extremely expensive.
RLS has invested as a “Limited Partner” with Bioventures IV as part of the agreement, a venture fund managed by MPM. The fund closed on March 3. "The quantum of investment however, is small," said KV Subramaniam, Senior Executive vice-president and head of RLS.
“We will have an analyst working closely with MPM, gathering information and transferring knowledge to us as to how a venture fund works,” said Subramaniam.
The Bioventures fund would give RLS the unique ability to exert indirect management control over the companies the venture funds. However, there are other large limited partners in the fund that include major pension funds and financial services.
RLS would also have the exclusive rights to clinical research activity outsourced by ompanies in which the Bioventures fund would have a holding, said Subramaniam. The entire process would be facilitated by MPM, according to a joint release by the two companies.
RLS is also expanding its US operations in clinical research to accommodate the increased order flow. It has set up a wholly owned subsidiary, Reliance Clinical Research Limited, in Delaware, US.