Biotechnology Market India Potentials on India's Biotechnology Market
A new market report by Ernst & Young ('Beyond Borders – Global Biotechnology Report') sees great potentials for India's biotechnology industry. Only recently, the country's biotech market reached a record turnover of over US $ four billion.
Mumbai/India, New York City/USA – India's biotech industry is still on a steady growth curve, having broken the US $ four billion mark last year for the first time – A recent report by the professional service and accountary company Ernst & Young (E&Y) stated that domestic turnovers in India for 2010 had climbed from around US $ three billion in the previous fiscal to a record value of four billion. Future growth is expected to come from the country's strong position in biosimilars but also molecular diagnostics and personalized medicine are promising trends of India's biotech industry, the report states.
According to E&Y, India's biotech and pharmaceutical industry profits from its low-cost manufacturing capabilities and strong position in small-molecule generics. 2010 saw a series of strategic alliances, partnerships and acquisitions, mostly in the biosimilars business. Especially the acquisition of Biovel Lifesciences by Ranbaxy Laboratories in Januray, Biocon’s commercialisation agreement with Pfizer as well as the company's plans to expand its R&D facilities to Malaysia, and Cipla’s acquisition of a large stake in MabPharm and BioMab attracted attention.
Market Potentials for Personalized Medicine
Although western company's have made significant advances into personalized medicine, the Indian industry is only beginning to tap into this exciting market. In 2009, the first ever 'Indian' sequencing of a human genome was completed at the Institute of Genomics and Integrative Biology (IGIB) in Delhi. The Indian Council of Medical Research, the country’s leading biomedical research body, set up a task force for specific research topics within pharmacogenomics in 2010 to future boost the development of new, personalised treatments. Following the trend, several Indian companies developed and market pharmacogenomic tests, primarily in cancer and cardiovascular disease.
'Chasm' in Funding of Biotechnology Companies
Although the global biotechnology delivered solid performances, there is a growing funding chasm between big, established players and small and early stage start-ups. Pre-commercial stage projects often depend on years of funding to support the development of new drugs. This is also a fact for India, where, with a few exceptions, the bulk of the biotech–industry consists of small and medium enterprises.
Especially these companies, often with only limited access to venture capital, largely profited from governmental funding in the state's Eleventh Five Year Plan (2007–12), that will phase out during 2012. Wether the next five year plan will see equal funding is not yet clear. The domestic sales of pharmaceuticals profited from 2008's Rashtriya Swasthya Bima Yojana (RSBY) program , a public health insurance program for the country's rural poor. According to E&Y, the program has quadrupled India’s health insurance penetration by covering 23.5 million households in its first three years.
Market Expects Stimulation from Governmental Funding
Further stimulation is expected from a 2010 governmental plan to set up a Rs 100 billion (US $ 2.2 billion) venture fund for supporting drug discovery and research infrastructure development projects in India and direct investments in biotechnology parks.
"Of the US$3 billion invested in Indian health care and life sciences over the last decade, only US$90 million has gone toward innovative biotechnology," said Utkarsh Palnitkar, Pluripotent Capital Managing Director in a recent statement. "Investors have shied away from discovery-stage enterprises, which are still relatively nascent, though a growing number of companies are emerging."
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