Bouncing biotech

Biotechnology has remained a nascent sector despite possessing all key ingredients for global success. NDA Govt was unable to match its biotech rhetoric with enabling policies, says Biocon group chairperson and MD Kiran Mazumdar-Shaw.

Biotechnology has remained a nascent sector despite possessing all the key ingredients for global success. The NDA government was unable to match its biotech rhetoric with enabling policies.

The NDA manifesto, however, did recognise the economic importance of biotechnology and promised to lend fiscal support and enact enabling policies that would streamline regulatory processes. But this came all too late.

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The Indian biotech sector has been lobbying for regulatory reforms since 2001. The biotech community has been pleading for fiscal concessions to support R&D, technology licensing and patenting activities and have strongly raised the urgency of creating a dedicated seed fund for encouraging entrepreneurship.

The Association of Biotechnology Led Enterprises (ABLE) and CII have untiringly submitted pre-budget recommendations to the ministry of finance each year with little success. The time has come to take this vital sector seriously. It is, therefore, with a sense of renewed hope that the Indian biotech sector looks to the newly formed UPA government for its focused attention on realising its global aspirations.

The UPA government has done well by appointing a dynamic minister, Kapil Sibal, to head science and technology. His opening assurances to the biotech sector are in the right direction. He has aptly described biotechnology as a ‘high technology’ that will not bypass the common man. Food security, affordable healthcare and environmental sustainability are all made possible through this powerful ‘technology of life’. So it’s with a sense of urgency that we have to make up for lost time and address the global opportunities that Indian biotech has in terms of building a sector as powerful as information technology.

As an industry spokesperson, I would like to propose an agenda that strives to attain the following:

* Catalysing investment into the biotechnology industry.

* Globally benchmarked R&D capabilities.

* Hassle-free regulatory environment.

* Manufacturing excellence.

* A strong patenting culture.

Here’s a list of recommendations that can drive such an agenda:

* Creating a dedicated biotechnology fund of Rs 200 crore to support seed capital for start up enterprises.

* Tax incentives for R&D, including international patenting.

* Exemption of capital gains tax to venture funds investing in biotech.

* Exemption of withholding tax for technology transfer and technology licensing.

* Fiscal incentives for biotech parks on par with SEZs.

* Fiscal incentives in the form of import duty exemption for capital goods and consumables that are key to the biotech industry.

* A streamlined regulatory system that enables product approvals in a timely manner.

* Remove biotechnology from the purview of industrial licensing. While the pharma industry is exempt, biotech is clubbed along with aerospace, defence equipment and atomic energy as sensitive industries that require special licensing.

* Introduce a self-regulatory mechanism for import of microbial cultures.

* Introduce special grants to biotech-focused CSIR labs (eg. CCMB, IISc, NCBS, IMTECH, NII, IGIB etc.) for the purpose of equity investments in ‘spin off’ companies created by ‘scientist entrepreneurs’.

The biotech sector keenly awaits the forthcoming budget to see whether the government can make the vital difference to this emerging sector to realise its true global potential.

(The writer is chairperson and managing director, Biocon Group)