Business Facilities - March 2008 - (Page 24)

COVER STORY Outside the Biotechnology Clusters “Saponin is one of our rising stars right now,” says Hinther. “It is building on technology developed at NRC-PBI.” NRC-PBI also investigates canola seed genomics and the mechanisms of drought tolerance and disease resistance. Hinther sees a big opportunity in biofuels because of the attention renewable energy is receiving. “A lot remains to be seen how biofuels are going to pan out in terms of long-term sustainability, but there is a lot of opportunity in biodiesel in terms of the plant-derived oils being used as additives to increase lubricity,” says Hinther. “The opportunity can be in the billions of dollars.” INDIA ’S BIOTECH CONTENDERS Oearned a spot on the global ver the past few years, India has 24 MARCH 2008 PHOTO CREDIT: STOCK.XCHNG.COM map of the biotechnology industry. India currently has close to 400 biotechnology companies, with total expenditures rising from $150 million in 1988 to $300 million in 1998 to $500 million in 2003. International companies such as Monsanto, Pfizer, AstraZeneca, Unilever, DuPont, Bayer, Novaritis, and Eli Lily have all located in India. Since biotechnology is a nascent industry in India, the government is taking strides to ensure its growth in the future. In January 2005, the government revised India’s intellectual property rules, offering patent protection for products as well as processes. “The strengthening intellectual property scenario in India has contributed greatly in attracting international biotechnology players to invest in the Indian biotechnology sector,” says Utkarsh Palnitkar, partner, transaction advisory services, Ernst & Young Private Limited in India. The government of India’s Department of Biotechnology also announced a new national biotechnology goal to achieve $5 billion in revenues and one million employees by 2010. Its strategy includes providing intellectual property incentives, tax concessions, and grants to support the sector, as well as boosting R&D, commercialization, start-up formation, and innovative product pipelines. “The market growth and foreseen potential of the Indian biotechnology industry together has been a strong stimulus for the government of India to take an active part in not only supporting, but also enhancing the opportunities available,” says Palnitkar. “Biotechnology has carved its own niche in the economic growth agenda of national and state policymakers.” Bangalore and Hyderabad are two of the cities spearheading growth of the biotechnology sector. The pharmaceuticals industry is flourishing in Hyderabad, making the city the bulk drugs capital of India. Known as Genome Valley, the city has a concentration of more than 100 biotechnology companies, 10 centers of excellence, and over 10 health care organizations, including the Centre for Cellular & Molecular Biology, the Centre for DNA Finger Printing, and the Indian Institute of Chemical Technology. “The Genome Valley biotechnology cluster, consisting of around 231 square miles, is the largest of its kind in India,” says Palnitkar. “Its research clusters act as magnets for high quality talent.” The Andhra Pradesh state government has been a catalyst for Hyderabad’s biotechnology industry, creating modern infrastructure both for R&D and manufacturing at the ICICI Knowledge Park and the Shapoorji Pallonji Biotech Park, which will soon have a biotechnology incubation center and animal testing facility. The state was also the principal sponsor for the country’s first venture capital fund, APIDS, which provides money to start-up biotechnology companies. Due to innovative, efficient manufacturing processes, Hyderabad companies have developed a significant manufacturing capacity for biogenerics, which will likely accelerate the development of products for sale in the global market. One such example is Hyderabad-based Shantha Biotechnics’ launch of the hepatitis B vaccine, Shanvac-B, in 1997, which resulted in a 30-fold domestic price reduction of the vaccine. Today, Shantha supplies nearly 40% of the UN Children’s Fund global Hep-B vaccine, which is distributed in Africa, Latin America, and elsewhere. In 2004, the Karnataka government set up “Bangalore Helix,” a 106-acre biotechnology park that includes the Institute of Bioinformatics and Applied Biotechnology, the Center for Human Genetics, an incubation center, a greenhouse, and an animal care facility. “Both Bangalore and Hyderabad are using the enclave city approach,” says Gautam Jaggi, editor of Ernst & Young’s “Beyond Borders” report. “These biotechnology parks feed companies, and solve infrastructure problems, [each] with its own sub-economy, state-of-the art infrastructure, and friendly regulatory and business environment.” Bangalore has grown as a biotechnology center by focusing mostly on innovation in biopharmaceuticals, with companies such as Biocon—which developed Insugen, a proprietary process for manufacturing human recombinant insulin— leading the way. According to BioSpectrum, a publication that tracks the Indian biotechnology sector, the biopharmaceuticals subsector accounts for over 70% of the country’s biotechnology sector and is growing by 30% annually. The subsector has seen revenues of $1.45 billion and is expected to hit the $3 billion mark by 2010. Bangalore is also starting to see multinational corporations conduct clinical trials in the city, relying upon Indian contract research organizations to manage these trials. For example, Merck and Pfizer (USA), AstraZeneca (UK), and others have contracted Bangalorebased Clinigene, the first lab in India certified by the College of American Pathologists, to conduct trials for them.

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Business Facilities - March 2008 Contents First Word Snapshots California Seeks Immigration Reform To Spur Economic Growth Outside the Biotechnology Clusters Global Biotech Competition Heats Up Location Is Key To Your Bottom Line New Incentives For New Hampshire Metro Spotlight: Jersey City, NJ Europe's Center For Goods, Real and Virtual Access Your Markets From Pennsylvania Corporate Moves: Illinois Louisiana Upgrades Important Port Road Projects To Accelerate Michigan's Economy Corporate Moves: South Carolina Metro Spotlight: Salt Lake City, UT Advertiser Index Inside LiveXchange

Business Facilities - March 2008

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