1

India as an OutsourcingFrontier in Biotechnology

3rd Annual Biotech Supply Chain Academy Conference

K.V. Subramaniam

President & CEO

San Francisco – Oct 26, 2010

2

Biotechnology Industry Issues

The biotechnology industry today faces several issues in its

growth and development.

Long gestation period

High costs of development

High costs of manufacturing

Regulatory hurdles

Diverse competency needs

Competition

Funding constraints

3

Biotechnology Outsourcing Advantages (1)

Outsourcing can address several of the issues faced by the

biotechnology industry.

Long gestation period

Shorter time to market

High costs of development

Favorable fixed to variable cost ratio

High costs of manufacturing

Access to:

high-productive process technologies

larger scale

Regulatory hurdles

Access to:

genetically diverse patients

therapeutically naïve patients

inaccessible domains ( stem cell research, large animal studies)

4

Biotechnology Outsourcing Advantages (2)

Outsourcing can address several of the issues faced by the

biotechnology industry.

Diverse competency needs

Access to competencies

Competition challenge

Lower costs (biosimilars)

Funding constraints

Lower burn rates

5

Biotechnology Outsourcing Opportunities

There are several outsourcing opportunities across many

business domains in biotechnology.

BUSINESS DOMAINS

Biosimilars

Novel Proteins

Vaccines

Plant

Tissue Culture

Molecular

Diagnostics

Molecular

Genetics

Biotherapeutics

Biofuels

Plant

Biotechnology

Industrial

Biotechnology

Predictive

Diagnostics

Plant

Metabolic

Engineering

Diagnostics

Stem cell

therapies

Tissue

Engineered

Products

Companion

Diagnostics

Biomaterials

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Biotechnology Outsourcing Opportunities

Cloning

Expression

Cell line development

Product characterisa-tion

Molecular

Biology

Process

Development

Quality

Management

Clinical

Research

Regulatory

Affairs Manufacture Marketing

Bioprocess development

Process scale-up

Pre-clinical

Animal model development

Toxicity studies

Efficacy

studies

Animal models

Bioassays

Clinical

Phase 1 to 4

PK-PD studies

QTc studies

Mass balance studies

Biometrics

Quality control

Quality

assurance

Validation

Dossiers

preparation

Regulatory

Interface

Intellectual

property

Clinical lots

Commercial batches

Cell line characterisa-tion

Product mgmt.

Sales

Medical affairs

Pharmaco-

Vigilance

Market research

FUNCTIONAL DOMAINS

There are several outsourcing opportunities in functional

domains across the value chain in biotechnology.

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Outsourcing - India Advantages

India has several advantages as an outsourcing frontier in

biotechnology.

Large home market

Enables scale

Less obscure regulatory pathway

Faster time to market

Large and diverse patient pool

Faster accrual and time to market

Lower development costs

Genetic diversity for stratified studies

Therapeutically naïve patients

Growing biotechnology industry

Access to competencies

Innovation

Manufacturing

Frontier areas

Regenerative Medicine

Biofuels

8

India Home Market Advantage

India has a reasonably large and growing healthcare

market, which can offer scale advantages.

Source: McKinsey, E&Y

Healthcare Spend India

($ bn)

32

66

80

93

107

125

146

38

54

43

0

20

40

60

80

100

120

140

160

2004 2005 2006 2007 2008 2009E 2010E 2011E 2012E 2013E

% of GDP 4.6 4.7 4.7 4.7 5.6 6.4 6.5 6.4 6.4 6.4

$ 66 billion market growing

16% p.a. to $ 146 billion by

2013

Public spending 0.9% of GDP,

expected to increase to 2% of

GDP by 2010

Life-threatening + Lifestyle

diseases

Cardiac disease capital of the

world

Diabetic capital of the world

Diverse oncology patient pool

Growing medical tourism – $ 2

billion by 2012

Strong in healthcare IT

Healthcare Statistics India US

Population 1.1bn 0.31bn

Hospitals 15,097 7,569

Medical Colleges 162 130

Statistics per 1,000 population

Hospital beds 0.7 6.1

Nurses 1.4 8.3

Physicians 0.7 3.6

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India Regulatory Advantage

India has a well-defined regulatory pathway for

biotechnology products, which can enable speed to market .

Gene Synthesis

Gene Validation

Electrophoresis

Stable Clone

Clone Expression

Process Dev.

Analytical Dev.

Stability Studies

Process Scale-up

Toxicity Studies

Approval by

IBSC and RCGM

Toxicity Studies

Clinical Studies

Approval by

IBSC and RCGM

Clinical Studies

Commercial

Manufacturing

Approval

DCGI

6 to 12 6 to 12 3 4 to 8 4 6 to 15 3

32 to 57 months

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India Clinical Development Advantage

India has several advantages in clinical development, which

can enable better patient quality and faster time to market.

Sites India UK USA Germany

ICH / GCP Sites 500 3,500 25,000 600

Investigators 2002 2005 2008 2010

ICH / GCP trained investigators 450 1,500 3,500 6,000

# of Personnel required 2300 4000 10,000 50,000

Trials 2007 2008 2009E 2010E

Global Trials 16,700 17,700 18,900 20,000

Trials in India 340 700 1,350 2,000

India Mkt. Share 2% 4% 7% 10%

Faster patient accrual

Therapeutically naïve patients

Genetically diverse patient pool

Lower costs (~30% less than USA)

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India Innovation Advantage

Indian companies have been investing in innovation, which

can enable access to competencies.

Novel product research

Reliance Life Sciences, Biocon, Dr. Reddy’s, Nicholas

Funding

DBT-SIBRI / DBT-BIPP schemes

Global Biotech in India

> $ 250 million invested to date

> 100 Trans-national company funded R&D centers

Amgen, Genzyme, BMS…

State-of-the-art Facilities

Reliance Life Sciences, Biocon, Piramal

Talent

Indian R&D institutions

Returning overseas Indians

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India Manufacturing Advantage

India is gaining ground in biopharmaceutical manufacturing,

which can enable competitive contract manufacturing.

Sr Company Microbial Capacity

(Litres)

Mammalian Capacity

(Litres)

Planned Capacity

(Litres)

1 Avesthagen - √

2 Biocon √ √

3 Cadilla Pharma √ -

4 Dr. Reddy’s √ √ √ (Mammalian)

5 Intas √ √

6 Ranbaxy/ Zenotech √ √

7 Reliance Life Sciences √ √

8 Serum Institute √ (Vaccines) √

9 Shantha √ (Vaccine) √

10 Wockhardt √ (Insulin), √ (Hep B/

Other proteins)

√

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India Competency Advantage

India has an endowment in competencies, many of them a

legacy from its pharmaceutical industry.

Target

identification

Gene synthesis

Gene validation

Electroporation

Stable clone

Clone

expression

Molecular

Biology

Process

Development

Quality

Management

Clinical

Research

Regulatory

Affairs Manufacture Marketing

Biorocess dev.

Bioanalytical

dev.

Stability

studies

Process scale-

up

Pre-clinical

Toxicity studies

Efficacy

studies

Animal models

Bioassays dev.

Clinical

Clinical opns.

Project mgmt.

Biometrics

Medical writing

Quality control

Quality

assurance

Validation

Dossiers

preparation

Regulatory

Interface

Intellectual

property

Upstream

Downstream

Purification

Fill-finish

Packaging

Bioprocess

control

Product mgmt.

Sales

Medical affairs

Pharmaco-

Vigilance

Market research

GXP Compliance

Value Chain

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India Talent Advantage

India has a strong talent base in biotechnology and allied

areas, which can enable access to competencies.

15,000 Biotech scientists

75 universities with biotech-

related programs

India produces each year

25,000 pharmacy graduates

10,000 chemistry post-

graduates

4,500 Ph.Ds

1,000 Engineering Ph.Ds

1,000 Biochemistry and

Chemistry Ph.Ds

2,500 chemical engineers

1,000 biotech post-

graduates

Source: E&Y, IBEF

Medical Institutions

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India Diaspora Advantage

India has a 25 million strong diaspora, many of them in the

pharmaceutical, biotechnology and health care sectors.

25 million strong

Primarily in education,

information technology,

communications,

semiconductors,

pharmaceuticals,

biotechnology and health care

35,000 physicians of Indian

origin in USA with 15% in

academic medicine

Indian Diaspora

UK , 6%USA, 11%

Asia, 72%

Africa, 11%

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India Cost Advantage

India has a cost advantage, which can enable lower

development and operational costs.

Source: KPMG CII Report

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India Limitations

India does have some limitations in certain functional

domains of the value chain.

Research

Extensive biological product

characterisation

Clinical Research

Large animal studies

Manufacture

Large-scale manufacture

(especially MAb production)

Regulatory

Developed market

biotherapeutic dossiers

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India Outsourcing Market

The Indian CRO industry is estimated to grow at a CAGR of

31% to reach USD 3 billion by the year 2015.

Indian CRO Industry

USD Billion

0.6

3

1.4

0

0.5

1

1.5

2

2.5

3

3.5

2008-09 2011-12 2014-15

Source: India Life Sciences Vision - Yes Bank CII Study

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Reliance Life Sciences Initiatives

Bio-

pharmaceuticals

Clinical

Research

Services

BiofuelsMolecular

Medicine

Biopolymers

Industrial

Biotechnology

Biochemicals

Plant Tissue

Culture

Plant

Biotechnology

Plant Metabolic

Engineering

Plant

Products

Embryonic

Stem Cells

Regenerative

Medicine

Hematopoietic

Stem Cells

Cord Blood

Repository

Skin and

Tissue Engg.

Molecular

Diagnostics

Genetics

Agronomy

Plant Tissue

Culture

Plant Metabolic

Engineering

Trans-

Esterification

Farm

Advocacy

Pre-clinical

Studies

BA/BE

Studies

Phase 1

Studies

Phase 2/3/4

Studies

Data Mgmt.

& Biostatistics

Biosimilars

Fusion

Proteins

Monoclonal

Antibodies

siRNA

Molecules

Plasma

Proteins

Pharmaceuticals

API

Formulations

Predictive

Diagnostics

Novel

Therapeutics

Ocular

Stem Cells

QTc Studies Largest pipeline of biosimilars under development globally

Conducting the largest clinical research study in India

(prophylactic for DVT, MNC client, 4050 patients)

Largest biopharmaceutical manufacturing capacity in India . Also

received European regulatory approval for drug substance

Only plasma proteins manufacturer in South Asia

Only company with commercial stem cell therapies in India

Reliance Life Sciences represents one of the most diversified and

integrated life sciences initiatives in the world.

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Summary

India is emerging as an important outsourcing frontier in

biotechnology.

Advantages Growing domestic market to enable

scale

Defined regulatory pathway for speed to market

Large patient pool for faster clinical development

Emerging biotech innovation hub

Strong talent pool and Diaspora for value chain competencies

Cost competitive in clinical development and manufacturing

Limitations Extensive product characterisation

Large animal studies

Large-scale manufacture

Developed market biotherapeutic dossiers

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Thank You