Knowledge Partners

 Economic Laws Practice       Avalon Consulting

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March 06, 2004

Hurdles facing the US biotech industry could benefit Indian cos.

"For all the enthusiasm that beats through the veins of the biotech industry, it remains a risky business, prone to delay, disappointment and outright failure," says a recent article in Mercury News. "In its quarter-century history, biotech has produced just 175 marketed biotech drugs. Only 70 of the 1,400 biotech companies have drugs on the market, despite spending $200 billion on research and development," it adds.

The Mercury News article profiles the travails of a Texas, USA-based biotech firm Tanox which has taken 16 years and spent (along with its partners Genentech and Novartis) hundreds of millions of dollars in developing an anti-asthma drug Xolair. And its success is still uncertain.

In order to cut costs, some US bio-tech firms are now looking to outsource their research and clinical trial processes to India. "I am here not to just talk about ideas, but also I am looking for outsourcing opportunities for my company," Vipin Garg, CEO of North Carolina, USA-based Tranzyme Pharma told Economic Times during a recent biotech conference held in Hyderabad.

Ace venture capitalist Vinod Khosla, during his latest trip to India, recommended that India can benefit significantly by having a liberal policy towards its bio-tech industry. He pointed out the area of stem cell research, which has been facing opposition from religious leaders in the US, as an especially ripe area for Indian bio-tech companies.