Submitted By:Aparna Vyas Barun Kumar Jayshree Bharti Manoj Dubey Rajesh Kumar Saurabh Mehta Manoj Dubey Veeresh Tripathi
GLOBAL BIOTECHNOLOGY INDUSTRYDiscovery of Recombinant DNA technology in 1973. Application in Agriculture, Industry, Medicine It is estimated that by 2025, BIO-DRUGS would replace 70% of conventional Therapies. The global biotech industry was $84.6 billion in 2010 and is expected to grow at a 7% CAGR to $103 billion by 2013.
Top 10 Global Biotech Corporations, 2010 In terms of RevenueRanking 1 2 3 4 5 6 7 8 Corporation Roche Amgen Inc Gilead Sciences Inc Biogen Idec Inc. UCB SA Genzyme Corp CSL Ltd. Celgene Corp
Cephalon Inc.Actelion Ltd
Source : www.pharmalive.com
INDIAN BIOTECHNOLOGY INDUSTRYIndian biotechnology industry revenues touched Rs 15,000 crores in 2010-2011. The industry has grown consistently in double digits over the last decade with average revenue growth figures greater than 20%. It is estimated to reach a turnover of around Rs 45,000 crores by 2015
Source - The Biospectrum-ABLE industry survey 2011
12 3 4 5
67 8 9 10 11 12 13 14 15 16 17 18 19 20
9th BioSpectrum-ABLE listing of Top 20 BioTech Companies 2010-11 Change over Company Revenue 2009-10 (%) 2010-11 2011 (%) Biocon 1483 25.68 Serum Institute of India 1041 22.47 Panacea Biotec 928.41 32.05 Nuziveedu Seeds 610 27.92 Reliance Life Sciences* 490 8.89 Quintiles India* 476.25 27 NovoNordisk 462 27.62 Rasi Seeds 371.88 3.65 Mahyco* 364.9 16.96 Transasia 350 88.17 Ankur Seeds 325 196.8 Syngene International 318 26.19 Bharat Biotech * 298.34 9.82 Indian Immunologicals 283 3.76 Krishidhan Seeds 276.13 107.26 Shantha Biotech* 272 -18.62 Novozymes South Asia * 242 8.04 Bharat Serums 226 29.14 Jubilant Life Sciences 210 -15.76 Eli Lilly 204 9.25
Notes: * represents BioSpectrum estimates
BIOCON THE JOURNEY BEGINS Collaboration
between Irish firm Biocon International and kiran with kiran owning 70% equity. Started Biocon India in 1978 from her garage with initial capital of Rs. 10000. During next 15 years focused on Solid State Fermentation. Biocon Secured a US Patent for reactor know as Plafactor for the manufacture of drugs.
VISION AND MISSION VisionTo promote social and economic inclusion by ensuring that marginalized communities have equal access to healthcare services.
MissionTo be an integrated biotechnology enterprise of global distinction.
BIOCON AND ITS SUBSIDIARIES
DR. KIRAN MAZUMDAR SHAW ENTREPRENEUR Visionary Innovative Leadership skills Risk averse Market analyst Self confident and optimist
DR. KIRAN MAZUMDAR SHAW ENTREPRENEUR
Kiran Mazumdar-Shaw's pioneering efforts in biotechnology have drawn global recognition both for Indian Industry and Biocon. Her unique vision has steered Biocon's transition from an industrial enzymes company to an integrated biopharmaceutical company with strategic research initiatives. Ms. Shaw is the recipient of several prestigious awards including Best Woman Entrepreneur, Model Employer, Ernst & Young's Entrepreneur of the Year Award for Life Sciences & Healthcare, Leading Exporter, Outstanding Citizen, Technology Pioneer, etc. Her most cherished award is however, the PADMASHRI (1989) presented to her by the then President of India, for her pioneering efforts in Industrial Biotechnology.
FEW MILESTONES ACHIEVED BY BIOCON
1978 - Incorporated as JV-Biocon Biochemicals Ltd & Kiran Mazumdar-Shaw. 1979 - First Indian company to manufacture and export enzymes to USA and Europe. 1996 - The commercial success of Biocon's proprietary fermentation plant leads to a 3-fold expansion; enters biopharmaceuticals and statins. 1998 - Unilever agrees to sell its shareholding in Biocon to the Indian promoters. Biocon becomes an independent entity 2000 - Establishes Clinigene, India's first Clinical Research Organisation (CRO). 2003 First company worldwide to develop human insulin (Pichia expression system). 2006 - Inaugurates Biocon Biopharmaceuticals, India's largest multi-product Biologics facility ; India's first anti-cancer drug, BIOMAb EGFR. 2008 - Biocon acquires 70% stake in German pharmaceutical company, AxiCorp GmbH 2009 - Biocon launches BASALOGTM - long lasting basal insulin for Type 1 & Type 2 Diabetics.
Wockhardt Limited Sun Pharmaceutical Industries Limited Ranbaxy Laboratories Limited Bharat Biotech International Limited Dr. Reddy's Laboratories Limited Oramed Pharmaceuticals, Inc.
PRODUCTS & SERVICESENZYMESBIOPHARMACEUTICALS Small Molecules Biologicals Dosage Forms
CLINICAL RESEARCH CUSTOM RESEARCH
Biocons strength lies in consolidated skills in producing enzymes. Another Biocons strength lies in its de-risked business model. Biocon is US FDA Certified Company which gives it a wide scope to enter global markets. This company is also the market Leader in India which becomes its one of the major strengths. Its core competence in molecular biology is one of the strengths it has. Internal low cost of clinical research gives it the power to stand and fight with all the competitors in the market. Last but not the least development of Oral Insulin is also one of its major strengths.
Internal Weaknesses80% of Biocons turnover comes from Statins which also makes 45% of its revenues. Biocons another major weakness lies because of its capacity build up in CRO. Moreover it also has the least expertise in final stage which is very important. Its marketing activities have been poor due to investments in other activities of the company
External Opportunity$82 billion worth global bbusters facing patent expiry India Share of Global generic market Increased to 33% from 4 % Enzymes market growing at 6.5 % Outsourcing to reduce cost India preferred destination for clinical trails ( $70 million 20% Gr) 177 Mn ( G )/ 45 Mn (I) Diabetic Patients 9 million cancer cases Entry of venture capitalist.
SWOT ANALYSISExternal Threats Risk in drug discovery Generics Market Being over crowded Strict IP regulatory laws Low cost Chinese Competitors Intense Competion in CRO
The Minister in charge of the industry has been threatening to impose even morestringent Price Control on the industry than before. Effective January, 2005 the country goes in for the IPR (Intellectual Property Rights)regime, popularly known as the Patent Act. This Act will impact the PharmaceuticalIndustry the most. In Pharma industry there is a huge PSU segment which is chronically sick and highlyinefficient. .Effective the January, 2005 the Government has shifted from charging the ExciseDuty on the cost of manufacturing to the MRP thereby making the finished productsmore costly
PEST ANALYSISEconomic Factors India spends a very small proportion of its GDP on healthcare ( A mere 1% ). Thishas stunted the demand and therefore the growth of the industry. Per capita income of an average Indian is low ( Rs. 12,890 ), therefore, spending onthe healthcare takes a low priority. The incidence of Taxes are very high
PEST ANALYSISSocio-cultural Factors Poverty
and associated malnutrition dramatically exacerbate the incidence of Malaria and TB, preventable diseases that continue to play havoc in India decadesafter they were eradicated in other countries. Poor Sanitation and polluted water sources prematurely end the life of about 1million children under the age of five every year. Large joint families transmit communicable diseases amongst the members Cattle-rearing encourage diseases communicated by animals.
PEST ANALYSISTechnological Factors Advanced automated machines have increased the output and reduced the cost. Computerization has increased the efficiency of the Pharma Industry. Advances in Bio-technology, Stem-cell research have given India a step forward. Newer drug delivery systems are the innovations of the day
Diversification rather than Expansion Sequential Growth Strategy Adding interlinked Business. Strategic alliances with Global Biotech firms as a way of Sharing development cost. PFIZER 2011 OPTIMER 2011 NOBEX CORP USA Focusing on Molecular Biology - Fermentation rather than Synthetic Chemistry to differentiate itself from competitors. Using Generics Platform to move into Drug Discovery.
STRATEGYInnovation Led Strategy
Split Business Technique
Syngene Clinigene Biocon
FINANCIAL ANALYSIS Biocons
net sales grew by 17% to 13,250,660 in 2010-11. Companys domestic revenues from product sales have increased by 25%, and exports sales have increased by 8%. The current assets, loans and advances have increased by 18% over the previous year. The current ratio have increased by 8.5% over the previous year.
BCG ANALYSISENZYMES BIOPHARMACEUTICAL
CONCLUSIONOn the manufacturing front, the innovation efforts should be directed towards delivering the highest quality at the lowest cost. On the services front, Syngene and Clinigene must aim to compete by augmenting specialized skills to deliver increasingly higher value services in a cost effective manner. On the research front, Biocon should pursue a strategy that will deliver incremental and transformational innovation in an affordable manner. Underlying these efforts there must be an un-inching commitment to operat