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The Indian biotechnology industry has witnessed a remarkable drive and notable modifications have spread a fresh aura of wellbeing, prosperity and sustainability. The Indian Biotechnology sector essays a strategic role in the economic development of the country by offering affordable healthcare services such as medicines and therapies while meeting the challenges of food and energy security. As per the Biospectrum-ABLE industry survey (2010-2011), the Indian biotechnology industry posted revenues of US$ 2.9 billion, in spite of the global recession during 2009 and measured recovery during 2010.
The sector has shown consistent development in double digits since the last decade with average revenue growth figures rising to more than 20 per cent. It has been estimated that the industry is poised to target a total turnover of US$ 8.6 billion by the end of 2015 which would only be possible if there will be a growth rate of about 30 per cent year on year basis.
The biotechnology industry can be classified into five different segments - agri-biotech, bio-industrial, bio-informatics, bio-pharma and bio-services with each concentrating on a particular niche area. Within the Bio-technology sector, the bio-pharma segment remains to preserve the first position, closely followed by the bio-industrial segment which has registered the fastest growing rate within the sector, surging from less than 5 per cent market share five years ago to over 14 per cent. The states of Karnataka, Andhra Pradesh and Tamil Nadu added to 44.22 per cent share of the Bio-technology industry, which was marginally higher than Gujarat and Maharashtra share of 43.60 per cent.
Major Investments
The Bio-technology sector witnessed 40 deals that were completed during 2010, and they have given a lot of impetus to the sector in India. Accompanied with low-cost manufacturing facilities and research and development capabilities in the field of small-molecule generics, the Indian Bio-technology sector is well placed on the global scenario.
Amongst the most prominent deals in the sector, Ranbaxy Laboratories acquired Biovel Lifesciences, Biocon’s commercialization agreement with Pfizer (the company also announced plans to establish R&D centers in Malaysia) and Cipla acquired a large stake in MabPharma and BioMab.
Bangalore-based Biocon will set up a bio-pharmaceutical manufacturing and research and development facility in Bio-XCell, a custom-built biotechnology park and ecosystem in Iskandar Malaysia, Johor. The new facility will become operational by 2014. The project will also focus on research and development and production of other bio-pharmaceutical products at a later phase.
Ticel Biopark is a 1.5 lakh sq ft facility dedicated for biotechnology companies, and has been set up in a joint venture between Tidco (Tamil Nadu Industrial Development Corporation) and Tidel Park, another joint venture between Tidco and the Electronics Corporation of Tamil Nadu. Ticel is now being expanded by an additional 6 lakh sq ft making it the largest biotechnology specific infrastructure facility in Asia. The expanded facility is expected to be completed by the year-end at a cost of US$ 28.7 million.
US-India Business Council (USIBC) will participate in the 12th edition of Bangalore India Bio, an annual biotech show, to explore business opportunities both in the US and in India. “They are expected to bring a sizeable team to participate at the biotech event,” Ms Kiran Mazumdar Shaw, Chairperson, Karnataka's Vision Group on Biotechnology said at the launch of Bangalore India Bio 2012.
Alexandria Real Estate, the US$ 5.2 billion US-based life science company will set up a biotech research and development (R&D) and incubation facility in the state of Gujarat at a cost of US$ 107 million for the project.
Avesthagen, a Bangalore-based life sciences firm, has entered into a joint venture with Limagrain, a French international cooperative group to build an agri-biotech business model for field crops.
Government Initiatives
In the wake of increased government initiatives through several funding schemes and venture capital funds that support the growth of the bio-technology sector in the country, significant improvement in the innovation in bio-technology has been registered. Set up by the Department of Biotechnology (DBT), the Small Business Innovative Research Initiative (SBIRI) and Biotech Industry partnership Program (BIPP) aims to offer financial support as early-stage investment and business support to biotech and medical device set ups in the country. In addition, a number of charitable organisations such as Bill & Mellinda Gates Foundations and Wellcome trust have offered funds for research and innovation in the bio-technology sector.
The Central government has taken an initiative to secure the domestic market of the fake drugs and for this purpose, a number of companies have been forced to adopt an SMS-based tracking facility to ensure genuineness of their medicines. Following this development initiative by the government, US-based PharmaSecure, a leading global player in providing SMS-based authentication services to pharmaceutical manufacturers, has reported greater acceptance of its track-and trace facility in India.
In addition, the Directorate General of Foreign Trade (DGFT), Government of India has also made it compulsory for all drug exports to bear serial numbers with track-and-trace capability. Similarly, the Drug Consultative Committee (DCC) of the ministry of health has also permitted an exceptional identifier for all local drugs so that they can be substantiated by customers through SMS, which is one of the path-breaking initiatives taken in the best interest of millions of customers in the country.
"The recent DGFT notification and DCC approval are indications of how the Indian government is positioning itself as a global leader in adopting with latest technologies to protect its consumers, both domestic and export, against fraudulent practices," said Nathan Sigworth, chief executive officer (CEO), PharmaSecure.
Road Ahead
The advantage of economical manufacturing costs, high quality drug research facilities, skilled and cost-competitive manpower has promoted India on the global platform of the bio-technology sector and is considered to be one of the major competitors in the race to become a leading global player. Besides offering a fast expanding domestic market, India provides a number of benefits to attract multinational companies from across the globe.
Exchange Rate used: INR 1= US$ 0.0191 as on November 25, 2011
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