With the highly cost effective and intellectual resources along with diverse genetic pool, India is all set to attract at least $1.5 billion- worth foreign investment in the area of pharma research and development by 2008. However, the country should necessarily be able to upgrade its R&D infrastructure and remove cumbersome laws in the areas of animal studies, clinical trials and labour laws, opine R&D experts while speaking at IndiaChem 2004, held in Mumbai recently.
The current R&D investment in the country stands between $100-150 million, annually. The global R&D spending is worth $ 60 billion ($ 21 billion in non-clinical research and $ 39 billion in clinical research). If all this R&D work scattered across the globe are shifted to India, the total global spending could be brought down to just $ 15 billion, said Dr. Shoibal Mukherjee, senior director - Medical, Pfizer Ltd.
"At present, it is difficult to bring the entire $ 15 billion to India. However, a 10 per cent of this business could be shifted to India and it is an achievable target by 2008, provided the infrastructure and laws are set in place," he said. Of this, about 25 per cent of investment could be anticipated for clinical research and the balance for drug discovery research activities, he added.
Dr. Mukherjee also urged the government to incentivise the R&D initiatives of companies. Countries like Canada, Ireland, Malaysia and states in US like Florida and California, offer concessions in the form of land, in the area of IT, funding, to companies yearning for investment in R&D in those states.
Generally, with every R&D investment of $ 1,000, government could pocket in earnings worth $ 250. "If government offers an exemption of 50 per cent of its earnings, it would still earn $ 125 in net revenue," he said. "From our estimates, if the government incentivises R&D, investments would go up by five times than when it does not. Moreover, more investment would bring in more employment to the locals," said Dr. Mukherjee.
Utkarsh Palnitkar, Director-Biotechnology & Pharmaceuticals, Ernst & Young Pvt Ltd, said the main issues facing Indian R&D sector include areas like infrastructure, funding from government and institutions, labour laws and special economic zones.
Currently about 18-20 potential NCEs are in pipeline of Indian companies. India today controls one per cent of the global clinical research market. "By 2010, we expect successful launch of those NCEs. Also, we hope India will improve its market share to ten per cent of the global clinical research market," said Palnitkar.