A similar ‘BT urge’ grips Andhra Pradesh. Start-ups like Shantha Biotech, Bharat Biotech and Dr Reddy’s Labs are growing feverishly in the entrepreneurial catchment of the Centre for Cellular and Molecular Biology. Chief minister Chandrababu Naidu is driving the state’s Genome Valley, carved from the badlands some 40 km from Hyderabad.
But take aside some 20 individual entrepreneurs like Shaw or Varaprasad Reddy of Shantha, Anji Reddy of Dr Reddy’s, Hari Bhartia of Jubilant Organosys, or Krishna Ella of Bharat Biotech, and the repeat of India’s prowess in IT appears unlikely. Here’s why we may get somewhere in bio-infomatics, but not in real products and brands that might guide this century:
First, patents. Giants like Elli Lilly have thrown a mere fraction of their budgets here—$20 million is loose change for the company’s bio-vision!—because they won’t trust our patent regime. “It would certainly help, if India stopped by just to look at alternate legal models available in Korea and the US,” says Singapore-based Heller Ehrnan attorney Russel A Stamets carefully, breaking the bad news as gently as possible. However, the frustration shows. Here’s one guy who has married a Gujarati, who didn’t mind if he had to beg CII for a Mallika Sarabhai dance performance in Singapore last winter, and he all he hears on the beat is complaints against patent violations dragging on for years, and companies not coming in, because they fear they may never be allowed to shut shop.
“I don’t like this...but that’s what’s happening: Clients never hire, if they can’t fire!” says Stamets. Clearly, this problem isn’t going to go in a long time, because the Supreme Court has taken a very empathetic view in the favour of workers. Then there’s the delay in new patent laws, and once they do come, the absence of special courts equipped to handle complaints professionally and expeditiously.
But Stamets remains hopeful. That one day, when Indian bio-tech majors start creating a shindy in the courts about the thefts of their own patents, “the outlook will improve”. But all that is in the longer term. Until then, the attorney fears that at the most the work that international majors will do here will be bio-infomatics, and back-end processes, but never really products.
Now is that all that is to India’s bio-aspirations Analyst David Flores, president and CEO of BioCentury, is regarded in life sciences, in a manner the Economist Intelligence Unit is in global business. And he won’t take that question! What he would tell for sure is that aside of leverages inherent in infomatics, far more important is capital.
“Today and more and more in the future, bio-tech equals science plus capital,” Mr Flores predicts, going on to warn against the pitfalls of fragmented (capital) markets and low levels of experience among investors.
“One day, India will need to throw up bio-tech pathfinders. Those who throw up risk funds. Those who are willing to become co-gatekeepers on quality...who can educate amateur investors,” he hopes, trying not to be judgemental about how little is the work that’s gone into the subject among Indian financial institutions. The one exception we’ve managed by far is the ICICI’s life sciences R&D incubator facility located adjacent to Hyderabad’s Biotechnology Park.
“There are too many soft models floating around,” Mr Flores warns. “Models where starry-eyed states reduce the risks, and co-invest, are fraught with danger. Let me tell you, it’s easier to start these companies than (it is) to grow them,” he argues, as minister Chandrashekhar nods in affirmation. Mr Flores estimates that there is already some $10 billion worth of liquidity available among venture funds for life science and pharma.
So how can India get a neat chunk Again, Mr Flores chooses to make a broader point. “In the absence of transparent and predictable policy, I see assets—human capital and idea—flying towards this capital rather than the other way around,” he fore-warns.
What lies within Mr Flores’ warning is that ad hoc policy responses on life sciences—from India’s often-at-war ministries of health, environment, science and technology, food processing, and bio-tech—isn’t the way to be. “You don’t have to protect a company if it screws up. But you don’t have to retain constant unpredictability on your policies either! To a bio-company, unpredictability means certain death!” he says.
Clearly, ‘IT’ won’t give India an automatic right on ‘BT’. There’s patents, policy, and capital to contend with.‘IT’—a sector that came up largely on its own, until our politicians and bureaucrats hitch-hiked into the party—is one frame in a rich bio-video!