Stable biotech policy welcomed by industry

Research and entrepreneurship in biotechnology has got a leg up in this budget with a move towards a more stable policy environment, aided by incentives for a long-term approach to the nascent industry.

This move of the finance minister has gone down well among biotech entrepreneurs, venture capital firms and academic institutions.

"We are delighted the government has accepted our recommendations for funding research and entrepreneurship in the biotech sector through increased allocation to the existing Rs150 crore R&D corpus for the pharma and biotech industry, the announcement of another Rs 50 crore National Fund for Strategic Agricultural Research and continuing with the weighted average tax deduction for R&D at 150 per cent," said Nitin Deshmukh, director general, Association of Biotech Led Enterprises.

The Rs 500 crore fund for SIDBI to assist and aid investment in small and medium enterprises could also cover the biotech sector, he added.

The biotech sector also hopes to benefit from the grant of Rs 100 crore to the Indian Institute of Science (IISc). Some of the biotech companies which have mushroomed in the country have direct or indirect link with the Institute. for example Shanta Biotech and xCyton have commercialised the institute's research.

The venture capital(VC) firms emphasise the implementation part of the Rs 150 crore R&D corpus for the sector.

"The increased R&D fund was due and its implementation is where the financial and VC firms are concerned," says Alok Gupta, country head (life science and biotech), Yes Bank India.

"The finance minister's praise for the sector is likely to create awareness on the nascent industry's strength as a low cost destination for outsourcing in drug discovery and clinical research and co-development of drugs. This may eventually lead to tie ups with global companies," he added.

The country has the potential to become an attractive destination for outsourcing in clinical research and co-development of drugs and manufacturing.

Underlying this is the objective of this year's budget to provide a stable and pragmatic biotech policy with appropriate incentives in order to augment innovation and product development, said Kiran Mazumdar-Shaw, chairman and MD, Biocon Limited.