Biotech industry to touch $7 bn mark by FY15-end: study

Growing at an average rate of about 20%, India's biotech industry comprising of bio-pharmaceuticals, bio-services, bio-agriculture, bio-industry and bioinformatics may reach the $7 billion mark by the end of FY15, an industry body said in a study.

"The biotechnology industry in India, comprising of about 400 companies has grown three-fold in the last five years to reach $4 billion in FY13," according to a study -- 'Access to Healthcare: Indian Perspective', conducted by The Associated Chambers of Commerce and Industry of India (Assocham).

India's biotechnology sector is divided into five segments based on products and services offered - biopharmaceuticals, bioservices, bioagriculture, bioindustry and bioinformatics. "Biopharma is the largest sector contributing about 62% of the total revenue followed by bioservices (18%), bioagri (15%), bio-industry (4%), while bioinformatics is still at a nascent stage contributing just about 1% of the total revenue."

With revenue generation to the tune of over Rs 12,600 crore, the bio-pharma sector comprises of vaccines, therapeutics and diagnostics. While, India has emerged as a leading destination for clinical trials, contract research and manufacturing activities owing to the growth in the bio services sector, which accounts for revenue generation worth about Rs 3,800 crore.

"India's biotechnology sector is benefitting from several advantages like its cost effectiveness, research and development (R&D) expertise and personal skills as India is now globally recognised as an ideal location for manufacturing biotech products and for conducting high-level research programmes in the field," said D S Rawat, secretary general of Assocham while releasing the chamber's study.

Increasing investments, outsourcing activities and exports are the key drivers for growth in India's biotech sector, he said.

"Biotechnology is a capital-intensive sector with long gestation periods for returns. Hence, it is important to provide an enabling environment such as incentives, infrastructure and funding models to make the industry sustainable. One such model is through life sciences park/biotech clusters," he said.

The global biotechnology industry is undergoing transaction, creating enabling factors that can lead to the growth of Indian biotech industry, noted the Assocham study. "India can play a key role in reducing the cost and time to market for new drug development through outsourcing of various component of the drug development process."

Since top pharma companies spend a large part of their research on licensing new modules, there is an opportunity for R&D-focused Indian biotech companies to enter into such alliances through collaborative development projects, the study added.

Besides, Indian companies with limited financial resources can optimize business models by partnering with larger companies for product development and licensing at an early stage as such deals are more common compared to the middle and late stage deals.

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Biotech industry to touch $7 bn mark by FY15-end: study