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Global generic drug companies, such as Merck and Pfizer, are actively scouting for big ticket Indian acquisitions. There are huge amounts of money sitting on the fence ready to fund biotech ventures. However, early-stage funding remains a challenge despite some positive developments in the sector.
Speaking at BangaloreBio 2007, Alok Gupta, country head, Life Sciences and Technology, Yes Bank, said, "Currently, we have the mandate from big European companies to buy Indian generic companies. This interest on India reinforces the message of India's growing presence in the sector."
Funding biotech ventures in the country is limited to a few banks and venture companies who have had exposure to the sector. It is only they who are active in funding and re-financing projects, he added.
The biotech sector has witnessed a lot of activities over the last few months with many acquisitions, outsourcing deals, private equity/venture capital activity in clinical trials and contract research. There has been a mushrooming of entrepreneurial activities.
"The entrepreneurial activities in the sector are mainly in R&D, with increasing cross-border talks on intellectual property rights' licensing. There has been an escalation in interest from global firms on leveraging their India presence for research and clinical trials," he said.
According to Mark Ravera, principal, Strategic Pharma Consulting, the west is faced with a daunting task on patent expiry, increasing challenges from generics, pipeline showing limited blockbusters, and in addition to that increasing pricing pressure.
It is here that India has a huge opportunity to tap clinical trials and help western firms hit the market early.
"At present, 80 to 85 percent of the 4,500 pre-clinical trials and over 2,000 phase I trials originate in the US or Europe. There is a growing number of biotech and pharma companies in south Asia that are looking to create value out of their in-house discovery efforts," he added.
Crispin Kirkman, managing director, ETNA, in his presentation said several western companies may still be slow in exploiting Asian outsourcing. But the flow of real interest from the west in India is growing to be a strong and steady stream.
India may now have to examine its strategic readiness for this interest, especially if it becomes a flood, since regional shortage of certain commercially-trained scientists may soon emerge and labour costs may rise accordingly, he added.
