A EvalueServe-Biotechnology in India 2005

8/6/2019 A EvalueServe-Biotechnology in India 2005

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Evalueserve, 2004. All Rights Reserved - Privileged and Confidential

Intellectual Property

Biotechnology in India:

the Next Wave through StrategicR&D and Intellectual Property

Rights


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Slide

Presentation plan

India is making its presence felt in the global biotech market.

Intellectual Property Rights offer both opportunities and threats to

Indian biotech companies and research institutions.

Indian biotech companies must increase their focus on strategic

R&D and IPRs.


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Slide

Presentation plan





R&D and IPRs.


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Slide

India has appeared on the biotech radar

Indias share in the global biotech market is currently about 2%.

Sales of biotech products in India are growing at a CAGR of 8.4%.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

1997 1998 1999 2000 2001

Source: A Report on the Indian

Biotechnology market

Mindbranch.com

$

billion


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Slide

Indian biotech companies are active in many sectors.

Agro-biotech (including seeds) is the largest sector with 42 companies

Source: Biotech India 2003

Distribution of Indian biotech companies across different segments

24%

3%

4%

9%

6%18%

5%

6%

4%

12%

1%8%

Agro-biotech

Bioremediation

Biopesticides

Biodiagnostics

Enzymes

Human health

Vaccines

Bioinstrumentation

Veterinary

Contract research

Bioengineering

Other

Total number of companies =

175

Major PlayersMonsanto

Biocon

Nicolas Piramal

Cipla

Biocon


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Slide

Major Indian biotech players are actively involved in

research

COMPANY R&D/REVENUE (%) LINE OF RESEARCH

Workhardt 10.5 Genome technology

Zydus Cadila 7.5 Genome technology

Torrent Pharma 6.4 Pharmaceuticals

Ranbaxy 6.0 Pharmaceuticals

Biocon 5.0 Enzymes

Dr. Reddys Labs 4.4 Therapeutic proteins

Cipla 4.0 Vaccines

Sun Pharma 4.0 Pharmaceuticals

Average 5.9

Sources: A Report on the Indian

Biotechnology market

Mindbranch.com &

Biotech India 2003

Major Indian companies, with their R&D expenditure expressed as a

percentage of their revenue, and their key line of research:


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Slide

The government is also supporting research through

various agencies.*

AGENCY BUDGETARY ALLOCATION *

(RS. CRORE)

University Grants Commission (UGC) 1407

Indian Council of Agriculture Research (ICAR) 1399

Council of Scientific and Industrial Research (CSIR) 912

Department of Science and Technology (DST) 779

Indian Council of Medical Research (ICMR) 147

Department of Biotechnology (DBT) 136

Department of Scientific and Industrial Research (DSIR) 58

Source: Status and Development of Biotechnology

in India: An Analytical Overview

Sachin Chaturvedi

RIS Discussion Paper

The total budgetary allocations amount to ~ Rs. 50 billion

*Total research budget allocations of agencies


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Slide

Presentation plan





R&D and IPRs.


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Slide

The Indian patent regime is changing

India needs to comply with the TRIPs agreement by 2005.

Drugs will become patentable as products, and not just as processes.

Important changes in the Indian Patent Act:

Patentable

subject matter

Before 2005 After 2005

Only process patents

for pharmaceuticals, food products,and agrochemicals

Product and process patents

for pharmaceuticals, food products, andagrochemicals

Process patents for these inventionshave a term of 5 to 7 years.

Process as well as product patents forthese inventions will have a term of 20years.

Provision for EMR grant tocompanies filing product patents

First Indian EMR granted to Novartisfor Glivec in November, 2003

Product patents will be issued. Hence,there is no need for EMRs.

Term of patent

Grant of EMRs


10/20 Evalueserve, 2004. All Rights Reserved - Privileged and Confidential

Slide

in light of these changes, Indian biotech companies

face a number of opportunities and certain threats as well

STRENGTHS

Trained manpower and knowledge base Good network of research laboratories

Rich biodiversity

Well-developed base industries(e.g., pharmaceuticals, seeds)

Extensive clinical trials and research

Access to vast & diverse disease populations

WEAKNESSES

Missing link between research andcommercialization

Lack of venture capital

Relatively low R&D expenditure by industry

Doubts about the ability of Indian products tomeet international standards of quality

OPPORTUNITIES The large Indian market can be captured by

gaining IP protection.

There will emerge new revenue streams frompatent licensing and litigation.

Strong IP protection increases the lucrativenessof India as a destination for contract research.

THREATS Existing business models will not work.

Fresh investments need to be made in newdirections (strategic R&D set up, IP protection).

Sources: Biotech India 2003

Evalueserve analysis



Slide

New opportunities are emerging for Indian biotech

companies

New revenue streams

Revenues from patent licensing and

litigation can re-define existing business

models completely, and shift them to ahigher value-generation plane.

Emerging business

opportunities

India will become a highly lucrative

option for contract researchonce

strong IP protection legislation is

introduced.

Capturing the Indian

market

Indian companies can introduce entry

barriers for foreign players in the Indian

market by using IP to protect their own

innovations.

Collaborative R&D

Indian companies can partner with

foreign players to enter intocollaborative R&D efforts as an initial

step towards developing an R&D focus.



Slide

however, the opportunities are accompanied by certain

threats as well.

Current scenario By reverse engineering, Indian pharmaceuticals companies have

circumvented existing process patents, in order to produce patented drugs.

For example, consider that a company has a process patent for a drug in India.In the present scenario, an Indian company may easily circumvent the patent by altering theexistent drug manufacturing process.

The Indian company may sell this drug in the local market at lower rates, or may export it to

countries with no patent for this drug.

Post 2005 Scenario India will issue process and product patents for drugs.

Once a company obtains a product patent for a drug in India, no othercompany will be authorized to manufacture the drug in India.

Therefore, the existence of companies producing patented drugs bycircumventing the production process of these drugs will be endangered.

We need to shift to R&D-pivoted business models in the Indian

Biotechnology industry.



Slide

Presentation plan





R&D and IPRs.



Slide

Indian research organizations need to redefine their R&D

approach.

A value-centric lifecycle of an invention

IdeationValue

extraction

IP

protection

R&DEarly-stage

valuation

Ideation

Value

extraction

IP

protectionR&D

An idea-centric lifecycle of an invention

Strategic R&D



Slide

Strategic R&D transfers research from a vicious cycle to a

virtuous cycle

IP

Protection

Valuation

Large unvalued

Intellectual

Capital

Huge R&D

expenditure

Non-

commercial

Ideation

The Vicious Cycle The Virtuous Cycle

Commercial

Technology

Valuation

Ideation

Valued

Intellectual

Capital

Strategic

R&D

IP

Protection



Slide

Evalueserve client example 1:

Identifying areas for strategic R&D

Identify possible

opportunities

Evaluate

opportunities

Identifyhigh value

opportunity areas

Invest in R&D inhigh value

opportunity areas

A case study on strategic R&D of a pharmaceutical company:

Investing in R&D

in high opportunity

areas

Licensing in

existingtechnologies

Analysis of

competitor

strengths

Identification of

disease areas withlow IP density

Identifying high

potential disease

areas with a low

IP density

Hematology TA:

large market size

and a high growth

rate

Large number ofdisease areas in

the Hematology

TA

Analysis of current

treatments

Analysis of trends

in R&D and IPR

Competitors in the

space



Slide


Extracting value from the output of strategic R&D

Maximize IP

protection

Study the marketand technology

space

Analyze themarket

opportunities

Identify value

extraction routes

A case study on the use of strategic R&D for capturing a niche area:

Development of a

business plan for

commercializing

clients technology Identifying

possible routessuch as

commercialization,

licensing, and

partnering for

extracting value

from the invention

Identification of

immediately

competing

technologies

Identification ofthe advantages

and disadvantages

of competing

technologies vis--

vis the clients

technology

Client wanted to

identify a strategy

to commercialize

a technology

related to the

cardiovasculartissue engineering

domain.

Evaluation of

potentially

competitive

technologies in the

technological

domain

Analysis of market

opportunities in the

technological

domain



Slide


Maximizing the scope of IP protection for your inventions

The invention:

An invention related to a new bypass surgery graft

The process:

EVS analyzed the invention, performed a prior art study, and

identified different claimable embodiments of the bypass surgery

graft.

EVS claims various embodiments of the graft in the patentapplication.

The result:

The patent covers almost all the different embodiments of the

invention.

The patent erects entry barriers so that competitors cannot bypass it

without infringing on it.

A well-protected invention has higher value-generation potential

compared to a loosely-protected invention.



Slide

India must develop an IP focus.

Develop an IP-centric strategic R&D focus.

Obtain strong IP protection for your inventions.

Develop products and build Brand Equity.

Extract value from protected inventions by identifying and encashing

the right value extraction routes (licensing, commercialization, cross-

licensing, etc.)


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Intellectual Property

Biotechnology in India:

The Next Wave through Strategic

R&D and Intellectual Property

Rights

A EvalueServe-Biotechnology in India 2005

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