SEMINAR ON BIOTECH IN BANGALORE: PAST EXPERIENCES, FUTURE TRAJECTORIES (SUPPORTED BY UKIERI)

CENTER FOR PUBLIC POLICY

CHIRANTAN CHATTERJEE, IIM BANGALORE

BETWEEN LEAPFROGGING & SELF DISCOVERY THE FUTURE OF THE INDIAN BIOTECH INDUSTRY

SOME MUSINGS

• Overheard at Bangalore BIO India:

•the Biotech Industry is at $4 billion (some idle questions?)

• What share of that is Biocon’s?

• How much does China invest in biotech R&D?

• Still just a fraction of Global Biotechnology

• So what is the fuss about?

BETWEEN LEAPFROGGING & SELF-DISCOVERY

• Leapfrogging among nations (Krugman et.al 1993) and firms (Fudenberg and Tirole 1985)

Intuition: Established monopolists may systematically have less incentive to

innovate than potential rivals and thus may in effect eventually cede technological

leadership (a partial equilibrium result).

• Economic Development as Self-Discovery (Hausmann and Rodrik 2003)

Intuition: Learning at what one is good at in a general equilibrium set-up.

EVIDENT IN MANY FIRMS OSCILLATING IN THIS DICHOTOMY! (A HYBRID MODEL?)

Xcyton, Connexios, Suven Labs, Jubilant, Biocon, Glenmark, Advinus, Strand Genomics among many others….

What’s next for them?

WHAT’S NEXT FOR THEM? (REGULATORY AND OTHER CHALLENGES)

BIG PHARMA PATENT CLIFF

Biosimilars

Healthy respect/collaboration between institutions and between firms

Conduit for Commercializing

Academic Research and Traditional Knowledge

Tapping into the Global Networks of Bio-Pharma Funding?

And Many More…

FROM E PLURIBUS UNUM TO E PLURIBUS PLURIBUM (WHY IS A STRATEGY PROFESSOR TALKING PHILOSOPHY/RELIGION!)

- Experimentation with organizational forms and firm boundaries.

- Oscillation means patience & patience requires deep reservoirs of faith

- No respite (till there are success stories, as Vijay likes to put it).

- What the GoI should (and should not) do..almost like parenting an

adolescent….

WHAT THE GOVT. SHOULD (AND SHOULD NOT DO!) (SOME IDEAS FOR CORRECTING MARKET FAILURES, IP MECHANISMS)

Create a MARKET FOR IDEAS BY FACILITATING INNOVATIVE ENTREPRENEURS more than established

firms? / Operationalizing IP mechanisms for appropriating rents from innovation

Conduit for COMMERCIALIZATION OF ACADEMIC RESEARCH? Efforts at NCBS/CCMB? Need for

many more…?

Initiatives like NMITLI could not only fund governmental but INDUSTRY RESEARCH.

Better HARMONIZATION BETWEEN S&T AND THE COUNTRY’S PUBLIC HEALTH requirements.

A 3RD PARTY EVALUATOR OF IDEAS, and generation of capable managers, even if founders

have low Entrepreneurial Ability…(reduces dysfunctional firms in the economy, Zingales

(2000)).

TALKING ABOUT ENTREPRENEURS (VARIATION IN ENTREPRENEUR TYPES, ONGOING PROJECT WITH MOSTAFA, UWO)

Entrepreneurial Variation:

Returnee Scientist Entrepreneur.

Domestic Scientist Entrepreneur.

Academic Entrepreneur (domestic or returnee coming from an

academic institution).

Spin-offs: From Traditional Pharma/Larger Bio-tech.

No relation to Bio-pharma.

TALKING ABOUT THE (AMBIDEXTROUS) SCIENTISTS (A PASTEUR’S QUADRANT IN INDIA CONNECTING LEAPFROGGING/SELF-DISCOVERY?)

TALKING ABOUT (VANISHING) PUBLIC SCIENCE IN BIO-PHARMA

Comp any Publications Citations

Dr. Reddy'S Laboratories 620 4258

Ranbaxy Laboratories Ltd. 401 2683

Wockhardt Ltd. 214 959

Hindustan Antibiotics Ltd. 203 1211

Biocon 111 446

Suven Life Sciences Ltd. 100 745

Indian Immunologicals Ltd. 97 254

Panacea Biotec Ltd. 95 1068

Serum Institute Of India Ltd. 91 438

Lupin Laboratories Ltd. 74 374 Source: IIMB Doctoral Student Priyanka Shukla’s On-going Research

SOME PRACTITIONER LEVEL THOUGHTS (AS OPEN QUESTIONS?)

- The Sector/Country needs Scientists who are Good Managers (How? Who

will provide that training on R&D Management?)

- Francis Collins, NIH Director was surprised that the country has no high-

throughput screens yet? (Food for thought?)

- Right combination of INCENTIVES & INSTITUTIONS to tap into the Global R&D

Labor Market (of Indian and non-Indian Origins).

- Why just Bangalore/Karnataka? (A question on diffusion/ecosystem)

TODAY’S SPEAKERS & THEIR KEY POINTS

- Ian: Changed Science Business Model (So is there going to be a Hybrid

Model? Or it is going to be another IT(Services) story?)

- Vijay: Regulatory Paralysis (yes, but how can one make good regulation

without careful economic analysis on the effects of regulation?)

A FINAL WORD ON A BRIGHT ‘FUTURE’ (WITH SOME THOUGHTS FROM SHAKESPEARE)

“There is a tide in the affairs of men, which, taken at the flood, leads on to fortune; Omitted, all the voyage of their life is bound in shallows and in miseries.

On such a full sea are we now afloat; And we must take the current when it serves, Or lose our ventures.”

– From Julius Caesar, William Shakespeare.

- Lots of new entrants and start-ups.

- I find a lot of vibrancy in the youth (source of disruption?) about biotechnology.

- Very capable scientists.

- Ecosystems and institutions (still evolving!).