The Hyderabad based biotesting and contract research firm, Vimta Labs Ltd (VLL), which opened its first regional laboratory in Chennai, in collaboration with the Voluntary Health Services (VHS), plans to invest Rs 8 crore for expansion programmes this year. As part of the expansion plan, VLL would open 15 clinical diagnostic labs over the next one year.

According to Dr S P Vasireddi, CMD, the expansion would be funded mostly through internal accruals and short-term bank credit. "We had a Rs 6.5 crore cash flow last year and we are confident of generating Rs 8-10 crore this year. This should help us fund our expansion plans," Vasireddi said.

The company had invested Rs 3 crore already for the first phase of the Chennai research centre, Vimta-VHS Research Centre. It had also invested Rs 4 crore for a laboratory at the upcoming Ticel Biopark, to address the quality testing requirements of biotech companies.

Announcing the launch of Vimta-VHS Research Centre in Chennai on Thursday, Varireddi said the research centre was being set up with a 50-bed clinical pharmacology unit, of which 26 beds would be operational in phase-1. He said the total size of clinical diagnostic business was estimated at around Rs 2,000 crore in India. Of this only 10 per cent was catered to by the accredited labs in the organised sector. He said around 70 per cent of test samples from Chennai were going to labs outside Chennai. Clinically it was not prudent to move them over to long distances. Hence, the company saw a lot of potential within Chennai in the diagnostic area.

Vasireddi said VLL would set up clinical diagnostic labs in partnership with leading speciality hospitals in Chennai and also independent units in locations where there was a concentration of hospitals and clinics. The collaborative effort between VLL and VHS in Chennai would address the demand for speciality tests in bio-chemistry, haematology, immunology and histopathology.

The expansion plans would cover high growth areas. In fact VLL would be assisting VHS and other hospitals in treating patients for super-speciality tests. He said the clinical reference labs would have the latest equipment.

The company was also planning to set up clinical reference labs in Vijayawada and Visakhapatnam in Andhra Pradesh, in addition to covering other states soon. It had proposed to set up a second lab in Hyderabad for which the company had to identify a suitable location. This project would take at least two years for completion.

In view of the controversies surrounding human volunteers in drug trials, Vimta Labs had shifted emphasis to recruiting volunteers who have had a formal education, especially students. " We try to focus on educated people in order to make them understand the process. We find it easier to explain to the students," according to Dr Mani Sishta, Vice-President, Clinical Research.

The emphasis on educated volunteers came in the wake of a controversy involving the company recently. The company was accused of exploiting people from rural Andhra in tests. Now students comprise between 25 and 40 per cent of the volunteers in various tests.

However, the company would continue to recruit volunteers who would not have much formal education. This was because of the need to have a patient sample that was representative of the unique characteristics of the overall population, Dr Varireddi explained.