Building Biotechnology in India


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Building Biotechnology in India

  1. 1. Global Perspectives on Industrial BiotechnologyInternational Bioenergy Summit 2012November 5-6 2012Yali Friedman, Ph.D. –
  2. 2. Global Biotechnology Global Biotechnology Overview Location matters • Workforce cost, availability • Access to skilled management, supportive services • Proximity to innovative science and markets Who is doing what, where?
  3. 3. Global Biotechnology Technology producers vs. consumers Innovators • Products tailored • Gain foreign to domestic needs currency • Tax revenues • Reliant on others to from domestic develop products for domestic needs companies Followers • Non profit-enabling and workers projects are unlikely to attract investment Importers Exporters
  4. 4. Global Biotechnology Strong market opportunities drive innovation Why is the U.S. the world leader in biotechnology? • World’s largest market for most biotechnology products – Not divided like European countries • World’s strongest patent protection • World’s largest absolute expenditures on R&D – The U.S. once spent more on R&D than the rest of the world combined • No government price controls on drugs
  5. 5. Global Biotechnology Developing Country Perspective Case Study: Philippines • Limited domestic drug production capacity • Must purchase essential medicines from foreign countries with higher wage-costs (e.g. Singapore) – This is effectively reverse-offshoring • Government has a limited budget, must make difficult decisions about how much of which vaccines to buy • Domestic production would reduce costs, preserve foreign currency, keep revenues domestic, and could train workers for innovative drug development
  6. 6. Global Biotechnology Acquiring Medicines Develop a domestic drug development industry • Pros: Can develop drugs for domestic needs, can drive tax revenues, can derive foreign currency from exports • Cons: Expensive, takes time, requires unwavering government support Buy drugs from foreign countries • Pros: No need to invest in risky R&D, gain access to best drugs produced by global leaders • Cons: Expensive, depletes foreign currency, doesn’t generate tax revenues
  7. 7. Global BiotechnologySolution: Produce foreign drugs locally Weak patent laws enable domestic production of drugs developed elsewhere • Pros: Low-cost domestic production of many drugs using domestic workers, tax revenues from production and sales • Cons: Reduced foreign investment by global firms, reduced motivation to develop drugs for locally-endemic conditions
  8. 8. Global Biotechnology Costs of Weak Patent Protection India (mostly) adopts TRIPS accords in 1995 • Amends patent laws to protect product patents, with the notable extra criteria that new drug products must “differ significantly in properties with regard to efficacy” • In 2007 Novartis failed to obtain a patent on Glivec (sold as Gleevec in the US) • Novartis CEO: unfavorable patent ruling is “not an invitation to invest in Indian research and development.” Company will redirect hundreds of millions of dollars in investments to countries where it has greater IP protection.
  9. 9. Global Biotechnology Who benefits from not patenting Glivec? Novartis provides Glivec free to most patients in India • Because Indian manufacturers would be unable to compete with Novartis’ free domestic distribution, their target markets would likely be in other countries, where they could potentially erode Novartis’ market. Is India forfeiting investments from Novartis simply so that Indian companies can sell Novartis’ drugs abroad? Does this serve the public?
  10. 10. Global Biotechnology Overcoming weak/poor markets Mectizan • River blindness drug developed by Merck • Affected individuals unable to pay for drug, so Merck distributes the drug for free • This model is unsustainable. Doesn’t incentivize development of drugs for these conditions, instead relying on companies to support tangential discoveries. OneWorld Health, Bill & Melinda Gates Foundation, etc. • Non-profit drug company solicits foundation support to actively develop shelved drugs for neglected populations
  11. 11. Global Biotechnology Meeting national needs: Economic Development Three basic models India, Brazil, Thailand • Weak IP, focus on generic production and foreign sales Israel, Cuba, maybe India • Moderate IP, leverage generic production skills to develop innovative drugs Singapore, Puerto Rico • Strong IP, attract manufacturing investments from global leaders
  12. 12. Measuring Global Biotechnology
  13. 13. Biotechnology is a Global Industry
  14. 14. Measuring innovation capacity
  15. 15. Top and Bottom
  16. 16. Brain drain
  17. 17. University-Industry Collaboration
  18. 18. Agricultural Biotechnology
  19. 19. Biotechnology paper output
  20. 20. Higher Prices = Faster Access
  21. 21. Innovation is still in legacy pharma countries
  22. 22. IP and R&D
  23. 23. Bottom line• Internal development or external? Innovation or duplication – Patent policy must be aligned with goals• Build strong foundations: – R&D activity – Brain drain• Support the business case – Identify global best practices with local relevance – Answer the question: Why India? Why now?