The world’s first biotech company Genentech started in 1976 and the very first recombinant product, h-insulin (Humulin, Eli Lilly) was approved by FDA in 1982. Since then in last 40 years the biotech industry has made great strides and even the term biotech has acquired a broader meaning encompassing both small molecule drugs based on novel biological pathways and biopharmaceuticals – recombinant protein derived drugs like MAb (monoclonal antibodies) and other products to combat diseases. However biotech industry is not limited in its application in the health care sector and is finding applications in many other areas notably agriculture, food technology, textile, leather, paper etc.

Recombinant protein based drugs consist about 65 per cent of all biopharmaceuticals today. According to a report from Boehringer Ingelheim, the sales of biopharmaceuticals globally were $125 billion of which Mab sales was around $40 billion. The current growth rate in the regulated market is around five per cent (CAGR). The growth will continue without much dampening although the biosimilar entry in near future to the US market is still doubtful.

In Europe around a dozen biosimilars has so far been approved and it’s currently leading the way in the regulated market. It is expected that biopharmaceuticals will be almost 40 per cent of top 100 pharmaceutical products by 2016 reaching $150 billion and the Mab alone will be close to $80 billion.

The top eight markets, i.e. USA, Germany, France, Italy, Japan, UK, Spain and Canada will constitute the 80 per cent of the biopharmaceutical market. BRIC nations plus Mexico, South Korea and Turkey will also see an increase in the sales of biopharmaceuticals from 10 per cent to about 12 – 13 per cent by 2016. The products will mostly consist of recombinant proteins, insulin, erythropoietins, interferons, colony stimulating factors, immunoglobulins, recombinant blood factors, growth hormones, recombinant enzymes, interleukins, growth factors, monoclonal antibodies and purified proteins.

It is predicted that by 2016 top three best-selling drugs will be biopharmaceuticals. Humira (anti inflammatory drug, Abbvie) will be the largest selling pharmaceutical product and seven out of top 10 drugs will be from biopharmaceutical sector. Collectively top six of the biopharmaceutical products will bring more than $36 billion.

Stem cells therapy which in all likelihood will become an important addition to the armoury of disease combating drugs may not hold an important position till 2020. Regulatory hurdles and ethical considerations have already complicated its application although it’s widely recognised as superior and avant-garde technology. Today it’s mostly confined to research products with an approximate market size of $1.5 billion and is predicted to go up to $2.2 billion in 2016.This of course doesn’t include the stem cell antibodies. It is estimated that the total market size today is around $six billion and it includes stem cell research products, antibodies and therapies.

There are already around 90 companies globally involved with different aspects of stem cells research and the number is growing at an estimated rate of 50 – 75 per cent. Interestingly in India there are a few companies like Stempeutics, Totipotent SC and others who are making an early foray in the stem cell research area. There are already at least half a dozen companies in India offering stem cells banking however the entire stem cells industry in India is at a nascent stage. To promote this industry GOI in co-ordination with its various nodal agents, private enterprises and agencies like ABLE and others need to bring out a policy document regarding its production and clinical trials and of course guidelines for treatment.

The next important application of biotechnology is in the agri biotechnology where the market is growing with a CAGR of 12 per cent. The current market size is estimated to be at $15 billion and the market is predicted to grow to $25 billion by 2017. A further prediction of different agri biotech segment potential shows transgenic seeds segment to increase to $20 billion in 2017 while other related products will move up to $ six billion. Here again of course one has to appreciate the adverse sentiment again bio agri products among a large section of people in Europe and also in less affluent countries like India where requirement of speedy solution to adequate production of food is a stark reality.

From the above mentioned examples it is clear that application of biotechnology in Indian context is of immense importance. This has been realised early enough and Government of India (GOI) set up the Department of Biotechnology in 1986, only four years after the first biotech pharmaceutical product Humilin was approved by the USA FDA. Indian biopharma market is predominantly centred on production of biogenerics, both biosimilars and biobetters. The sale of biopharma products in India is around $200 million and with a CAGR of 20 per cent.

The current market value of all biotechnology related products in India is estimated to be around $4 billion with a 20 per cent CAGR. By 2018 the market is expected to reach around $10 billion. The Government encouragement through various organizations like DBT, DST, CSIR and BIRAC in this area is quite appreciable and hopefully will continue to remain till the biopharma market attains a greater level of maturity.

In spite of certain negative publicities Indian agribiotech is a $40 million industry and is predicted to continue to grow at an average 30 per cent CAGR in near term. According to USDA Bt cotton has penetrated almost 90 per cent of Indian cotton growing area. It is important to raise the level of awareness so that a similar or greater success can be achieved in bringing GM food products to the Indian market. Current Indian agribiotech market is estimated to be around $three billion although largely unfulfilled, third after biopharma and bioservices segments.

Interestingly many of the global generic companies like Teva, Mylan, BI etc are setting up their own units and also collaborating with predominant Indian players like Biocon, Kemwell etc to transfer technologies and enhancing manufacturing activities of biosimilars and biobetters. In this regard, Biocon, India’s oldest biopharma company is playing a pivotal role in developing biobetters through their own R&D initiatives and through in-licensing from various other global organizations.

Unlike the small molecule generic drugs, Indian companies are still trying to gain credibility with respect to the high quality manufacturing and quality controls and some of the early successful examples will be crucial for Indian companies to gain strong foothold with large MNC pharmaceutical companies.

Although at present Indian companies are actively engaged in exporting biopharma products to middle east, south American countries and to a much lesser extent to Europe, it will be of utmost importance to penetrate the European countries and later on to the US once the policies for substituting biosimilars in the US are formulated in a judicious manner to make it cost -effective for the manufacturers and patients. It can be reasonably expected that by 2020 Indian biopharma companies will have a global market share of 3-5 per cent and with time will advance to become major players as it is today in the generic small molecule area.

One of the major differences between the generic small molecule and biotech products is in terms of export. India has a formidable competition from China and to a lesser extent from South Korea and today frankly lagging behind China. Both China and South Korea governments are subsidizing the biopharma manufacturing companies in building world class facilities while in India such direct policies to encourage the industries to get more active with biological manufacturing are yet to be seen.

It is widely perceived in the west among the pharmaceutical companies that China and South Korea have also highly trained man power that the biotech industries will need in the future.

India through both government and private efforts have set up large number of academic institutions to produce a high quality workers. However more needs to be done particularly to utilise these human resources in a ready employable manner. Such efforts in creating “finishing schools” are already initiated in both government and private sectors. Biozeen, Biocon Academy are some of the highly specific training schools set up in recent times and a few more such schools exist.

To increase the awareness and to facilitate the interactions between the pharma companies, various forums exist today in India such as Bangalore India Bio, Bio Asia etc and apart from that organizations like ABLE provides yeoman’s service to promote the awareness and also advises at a national level to create a level playing field where India can successfully compete with rest of the world to mark its dominance in biotechnology.

In summary, the growth of biotech led industries in India is hopeful however not without problems at various levels both international and domestic. GOI has realised early enough the importance of government support and encouragement that this sector will need in contrast to India’s IT industry. A more clear understanding between biotech industries in India and government agencies involved with the development of biotechnology will help accelerate growth in this area.