Karnataka's contract research organizations (CROs) are now exhibiting signs of maturity with global companies showing confidence by providing opportunities for growth. The current scenario indicates high returns and robust growth.

There are over 20 CRO and related operations in the state. However the value of the sector is yet to be ascertained but boom has created investment opportunities for both contract research services and manpower.

The key reason for CRO business to succeed in the state is the prevalence of a strong research aura exudes in the capital city of Bangalore where all the CRO activities have taken off. From the presence of the leading research institutes like the Indian Institute of Sciences, National Centre for Biological Sciences, Jawaharlal Nehru Centre for Advanced Research to the scores of pharma-biotech companies' initiatives have all contributed in making the state more so Bangalore a hub for global outsourcing business.

Another supporting factor for the CRO business to take off here is presence of leading hospitals like St. John's National Academy of Health Sciences, MS Ramaiah Memorial Hospital, Sagar Apollo, Manipal, Wockhardt, Kidwai Institute of Oncology, National Institute of Mental Health and Neuro Sciences to name a few where availability of patient and physicians allow favorable conduct of multi centric clinical research activities.

Yet another favorable feature is the availability of manpower from the pharmacy, medical and dental colleges apart from the presence of the Institute of Clinical Research India which ensures easy availability of workforce.

Supporting the state-of-the-art infrastructure and personnel is the lower operating costs for conducting research which let Karnataka take a leading position on the contract research space, stated VR Kannan, pharma consultant.

The leading CROs in Karnataka include Biocon's Clinigene and Syngene, Lotus Labs, AQUAS of Avesthagen, Aurigene Discovery Technologies Ltd, part of Dr. Reddys, Quintiles, PharmaNet Clinical Research Services, Triesta Sciences, Manipal AcuNova, Pharm Olam ClinTec (India) International Pvt Ltd., Clintrac International, ClinWorld Inc, Glaxo Smith Kline's Clinical Data Management Centre and Vaatsalya,. in addition to scientists from IISc, NCBS and JNCAR who are engaged in projects on contract.

According to Kiran Mazumdar-Shaw, chairman and managing director, Biocon Limited and head, Vision Group on Biotechnology, Government of Karnataka, "Contract Research in Karnataka unfolds the emergence of a promising phase in the pharma-biotech space".

Companies in Karnataka can capitalize and profit from the contract research opportunities in small molecule synthesis from pharma-biotech firms in US and Europe stated Shaw.

An observation by a section of experts was that CROs are catching the fancy of private equity. Take the case of Manipal AcuNova where for its initial investment of Rs. 45 crore investment, 60 per cent, was funded by promoters and the rest came from venture capital firms and strategic partners. Many more such funding is expected to follow, because of the confidence in the business potential and its revenue generation ability they averred.

"Contract Research is on the upswing not only in the country but also in Karnataka but it is clear that it is only companies with a focused strategy imbued with competence and expertise that will survive in the long run ," observed DA Prasanna, vice chairman and managing director, Manipal AcuNova Pvt. Ltd.

With the much gung ho on the CRO business, a prevailing trend is the entry of pharma giants like Ranbaxy, Jubilant, Orchid, Torrent, Wockhardt and Glenmark in the contract research fray. These companies are now setting up exclusive contract research departments, informed Sudhir Pai, managing director, Lotus Labs. However, there is business for every body, he added.

In Karnataka, companies like Strides Arcolab, Bal Pharma Hikal, Sami Labs are also gearing up their services in the contract research space.

"Contract research has been one of our focus areas and we are aggressively progressing in the field by projecting our capabilities in process development of active pharmaceutical ingredients, intermediates involving multi-step synthesis, chiral chemistry," stated Jai Hiremath Chairman and managing director, Hikal.

Bal Pharma, the medium sized pharma major recently invested Rs. 3 crore in a new research facility at Bommasandra, near Bangalore with an intention for contract research jobs that is expected to be a potential revenue generator. said Shailesh Siroya, managing director, Bal Pharma.

Prof. G Padmanabham, former director Indian Institute of Science and scientist emeritus who is also upbeat about the capabilities of CROs, pointed out that as the contract research activities gain momentum, there is a serious lack of expertise in the filed.

According to a McKinsey Report, by 2010, more than 50,000 professionals will be required to fill jobs in contract research.

Contract research and particularly clinical research is a dynamic sector and the next potential growth industry India and Karnataka. By 2007, it is estimated that there is a the sector will face a shortage of 25,000 personnel in the sector, said Professor Anthony C Woodman, Chair in Translational Medicine and Director of Education Cranfield Health Cranfield University, UK.

In this connection the Institute of Clinical Research (India), ICRI, India's premier institution in Clinical Research has started its two-year MSc. programme in alliance with its global partner Cranfield University, UK. This course is directed at aiding Indian students pursue a world-class career in Clinical Research, said Anand K Nair, vice president, operations Institute o Clinical Research (India).

With Schedule Y regulations in place, the CRO industry is now in a situation to augment its services from Clinical Development Services like Bio-Availability/Bio Equivalence, Phase I Clinical Trials and Clinical Trials from Phase II to Phase IV. In this scenario it is not only witnessing new companies but generation of new jobs and additional foreign exchange, informed C. Omprakash, manager, Regulatory & Clinical Data Management, Clinigene International, a subsidiary of Biocon Limited.

The outlook of contract research organizations is promising. The patent regime, patients pools, infrastructure, cost advantage makes CROs in Karnataka and any where in India cash in on opportunities, said Dr. Ramananda S. Nadig, Chief Operating Officer, Manipal AcuNova.