The biotechnology industry in India is likely to see a significant uptick in the merger and acquisition (M&A) activity, primarily on the back of drastic restructuring that companies from the West had to undergo post the economic recession. However, challenges such as funding constraints may continue to persist, even as the Asian biotech economy would maintain growth with focus on research, according Grant Thornton.
Releasing the whitepaper — The Asia Promise — at the eighth edition of the BioAsia conference here on Wednesday, Mahadevan Narayanamoni, national leader (healthcare and life sciences advisory), Grant Thornton India, said: “Asia promises to be a biotechnology hub and this is made evident by the growing number of cross-border collaborations in 2010. India, China and Japan, which witnessed largest deals last year, signify that Asia is shifting strategically from a mere outsourcing destination to a centre of innovation.”
The Indian biotech industry crossed the $3-billion mark in 2010, witnessing a 23 per cent growth over the previous year. Of this, while the share of domestic firms stood at 47 per cent, exports accounted for 53 per cent of the overall revenues.
India’s high-skill and low-cost advantage is said to have helped in gaining export contracts and clinical research bioservices. Global marketing alliance between Biocon and world largest drug maker Pfizer for commercialisation of insulin biosimilar marks the trend, it says.
Last year, there were 270 bio pharmaceutical alliances globally, of which 93 involved at least one Asian country. Of the 93, Japan leads with 41 alliances, while China has 22 and India registered 13 alliances. “Reeling under the pressures of imminent patent expiries, the developed markets have relied on the acquisition or alliance route to sustain the growth. Asia has, therefore, witnessed many M&As and alliances over the last three years which marked a beginning of the ten year strategy by the West,” the report says.