BW Communities

Biotech Sector Failing To Innovate

BW Online Bureau Nov 08, 2014

<?xml version="1.0" encoding="UTF-8"?><root available-locales="en_US," default-locale="en_US"><static-content language-id="en_US"><![CDATA[Despite a double digit rate of growth over the last five years, the Indian biotechnology sector is finding it difficult to launch new products that match global growth trends, the annual biotech report of consultancy Ernst & Young points out. The 26th edition of the report, Beyond Borders: global biotechnology report 2012 released on 10 July, stated that even with a CAGR 19.2 of per cent during 2007–2011, Indian biotech industry has concurrently been facing diverse challenges that have prevented the industry from transcending to the next level. Within the domestic market, companies have not been able to launch new products at a pace that they would have liked. Dealing with multiple regulatory bodies typically results in serious delays, the report says. "Companies focused on innovation have not been able to make a sizeable impact on the industry. Many of them are facing funding constraints as the investor community has shied away from investing in early stage ventures. With the lack of funding, many innovative companies will be forced to shut shop or become service providers rather than innovators", it said. "India is already facing stiff competition from China, Korea, Singapore, and more recently Malaysia, in terms of attracting investments from MNCs. This has been enabled due to better technological and scientific competence, better infrastructure, tax and duty exemptions, and easier regulatory procedures as compared to India",  Ajit Mahadevan, Partner, Ernst & Young said. The report also listed out various government initiatives, including the setting up of biotech parks and fiscal sops that have been initiated to strengthen the industry in the country. According to E&Y estimates, Indian biopharmaceutical industry constitutes 60 per cent of the biotech industry in India and grew at 21 per cent y-o-y to reach $2.3 billion in 2010–11. Vaccines, insulin, erythropoietin and monoclonal antibodies have been the mainstay of the biopharma segment. "There is strong call for action for the government to act swiftly to carry out regulatory reforms, develop infrastructure and provide more incentives to the biotech industry to remain competitive and spur growth in the industry. The industry, on its part, needs to come up with a concerted action plan to utilize the available infrastructure and resources more efficiently and focus on nurturing innovation to take the biotech industry to new heights", Mahadevan states.