Without the support of its government, the Indian biotech industry may not be able to achieve its high potential, say James Greenwood, President and Chief Executive Officer, Biotechnology Industry Organization and Dr Panchapagesa Murali, President, Association of Biotechnology-Led Enterprises
The Indian biotechnology industry is on the cusp of entering a new era when it can provide significant economic growth and development to the people of India and around the world. India already has many of the necessary ingredients needed in order to grow its bioeconomy, such as a talented and enthusiastic scientific workforce. However, not all the ingredients are in place in order for the country to reach the next level.
In 2012, the Association of Biotechnology-Led Enterprises (ABLE) laid out an ambitious goal of growing the Indian bio-economy from its present $ 5 billion to more than $100 billion by 2025. This call to action was quickly picked up by Government officials and others who saw the potential benefits of a strong and vibrant biotech industry in meeting the needs of Indians in regards to medicine, food, fuel and environment.
This challenging yet attainable goal would place India’s biotech industry on par with India’s information technology industry in terms of numbers of high-paying jobs and in terms of revenue. For this to happen, India must address some fundamental areas of policy and regulation, and take steps towards creating an environment that encourages, not discourages, investment by innovators.
The current size of the biotech industry is approximately $5 billion. In order to reach the goal of $100 billion, we need a dual focus on entrepreneurship and innovation. At the moment, India has a limited number of biotech companies. In order to reach its potential, India needs to encourage the development of many more, by tearing down the barriers to new investment and improving the overall climate for business. About $4-5 billion in investment is needed on an annual basis for the next four years to realise the industry’s goal for growth. Furthermore, the country needs to encourage more academic researchers to become entrepreneurs, taking their ideas from the laboratories to the products, in the process creating many new jobs for India.
Separately, India needs to re-emphasise its commitment to innovation and introduction of innovative biotech products. Significant resources are rightly focused on manufacturing biotech products, particularly biopharmaceuticals, at lower costs in order to ensure widespread affordability. While admirable, this is an extremely competitive space and will not likely bring in significant revenue and thus not contribute greatly to the growth that India is looking for. An equal if not greater emphasis should be placed on developing new products for the global marketplace. By doing so, companies in India will be in a position to attract new investment capital and generate substantial amounts of new revenue. In such a manner, India will realistically reach its goal of creating a $100 billion industry.
Because our two organisations, the Biotechnology Industry Organization (BIO) and ABLE, see the potential that can result from collaborating, we teamed up last year, to produce a comprehensive report on the Indian biotech industry entitled “Accelerating Growth: Forging India’s Bioeconomy”. In order to reach the goal of a $100 billion bioeconomy, the country needs a working plan and this report was designed to provide such a guide. The goal was to provide the new Indian Government, led by Prime Minister Narendra Modi, with a road map for the nation’s biotech industry, identifying the major areas that require attention. Based on research and interviews with Government and industry stakeholders inside and outside India, the authors covered a range of topics, such as intellectual property, regulatory environment, tax and investment policies, and technology transfer.
Biotech, like other industrial sectors, requires an ecosystem to nurture and sustain it. In the case of biotech, this ecosystem requires substantial input and assistance from the Government of India, at both the Central and State levels. Biotech operates in a highly regulated environment. Numerous government policies, rules and regulations are at play, influencing every single aspect of the industry, from research and development, through regulatory approvals, taxation and finance, all the way to government procurement. These policy concerns go well beyond the mandate of any one ministry or agency. Rather, multiple ministries need to work together towards a common goal.
The biotech industry in India faces challenges that, like the country itself, are diverse and complex. We see evidence of slow growth in the sector tied directly to matters of policy and associated regulatory practices, for example clinical research. The government should take steps to speed the regulatory process, increase investment in the sector, attract multinational biotech companies, improve the business environment, and encourage innovation. However, doing so will require visionary leadership within government, coordination among agencies, public education, and steps to ensure government investments or policies are not stymied by unwarranted bureaucratic measures or the unintended consequences and costly delays of court rulings.
For India to compete globally, attract investment, and enjoy the economic benefits that its strength in biotech can bring, it needs to align itself with global standards in these areas. Below are some of the highlights taken from the report:
- The Government of India should focus on improving its regulatory agencies and processes to regulate the biotech industry in a transparent and consistent manner, giving patients and consumers confidence in the biotech products they purchase, and providing companies with a stable, predictable, and level playing field. Furthermore, India should harmonise its regulatory processes and requirements with those of other countries.
- Tax and investment policies should be reformed such that the necessary investments in infrastructure can be made.
- India should provide forums that foster partnering opportunities, and take steps to address concerns about the protection of intellectual property and other policies, laws, and business practices that impede partnering activity.
- The current intellectual property system in India is being perceived as an impediment to the development of the Indian biotech industry. Using the patent system as a mechanism to control drug pricing forestalls making the difficult decisions about necessary investment in the healthcare system, but does not deal with the underlying issues.
- Technology transfer from academic and government laboratories to industry should be encouraged, and researchers should have access to training to be successful entrepreneurs.
- The Government should exert leadership in the national debate about the appropriate uses of agricultural biotech based on a thorough social and scientific assessment of an appropriate incorporation of biotech into Indian and global food security.
India has the potential to be a powerhouse and a favoured destination for the global biotech industry. To achieve this vision, and reach its goal of a $100 billion industry, the country must have the right mix of policies, regulations, and business environment to attract global investors. Without the support of its government, the Indian biotech industry may not be able to achieve its high potential and the world will not benefit from what could be Asia Pacific region’s dominant biotech hub.
This report can provide the central government and various states with thoughts on where they should focus their energies in the coming months and years. At the urging of India’s new leadership, India is entering a new era of governance and regulation. Efficient and effective governance, coupled with a regulatory system anchored in global standards, is needed in order to provide the necessary underpinnings to allow Indian companies to compete on the global stage. In this manner, policymakers can help the Indian bioeconomy grow and thrive, in turn providing the economic, health and other benefits that India and its people richly deserve.