The biopharma boom

The biopharma boom

The use of biotechnology has, in a short time, revolutionised the pharmaceutical industry with its emergence as an effective tool in the treatment of diseases. Sapna Dogra analyses the potential of biopharmaceuticals to outperform the entire pharmaceutical market.

In 1982, recombinant human insulin, the first biopharmaceutical product was launched, marking the arrival of the biopharmaceutical industry. Since then, there was no looking back. The biopharmaceutical market has been growing rapidly world over. Currently, over 130 biopharma products are being marketed around the world and this number includes more than a dozen blockbuster drugs. In fact, biopharmaceuticals are hailed as the future medicine, which will revolutionise the treatment of diseases for which no cure exists.

Burgeoning market

The present global biopharmaceutical market is valued at around $71 billion with a growth rate of about 16 percent. The current sales of biotechnology products worldwide are pegged at around $40 billion. It is also estimated that by 2010, the figure is likely to cross the $100 billion mark. The biopharmaceuticals’ pie can be classified on the basis of geographies; North America accounting to almost 60 percent of the revenue and R&D. Europe accounts for 20 percent and Japan takes up 10 percent of the pie.

– Alok Gupta
Country Head LifeSciences Technology

Yes Bank

India too does not lag behind in its presence in biopharmaceuticals. The Indian biopharmaceutical market is valued at around $1.05 billion and it is growing at nearly 32 percent. So effectively, India’s share comes to around 1.5 percent of the global biopharmaceutical market. According to Alok Gupta, Country Head, Life Sciences Technology, Yes Bank, the industry is in a growth phase. It is also estimated that 400-500 biotech drugs are under clinical development for various disease conditions. Agrees Dr Arun Maseeh, VP, Medical Services, Cadila Pharma, “India is poised to become a leading biopharma base thanks to the WTO regime in which, innovation is being encouraged. Undoubtedly, in another three to five years, India will be on par with the west.”

Window of opportunities

India has more than 300 biotech companies focusing on different aspects of the value chain. Some of the prominent Indian companies involved in biopharma research are Biocon, Ranbaxy, Wockhardt, Dr Reddy’s Laboratories, Serum Institute of India and Reliance Life Sciences. India has many assets in its strong pool of scientists and engineers, vast institutional network and cost effective manufacturing, opines Mahesh Sawant, Programme Manager, Healthcare Practice, Frost & Sullivan India. There are over a hundred national research laboratories employing thousands of scientists. There are more than 300 college level educational and training institutes across the country offering degrees and diplomas in biotechnology, bioinformatics and biological sciences, producing nearly 5,00,000 students on an annual basis. More than 100 medical colleges add about 17,000 medical practitioners every year. About 300,000 postgraduates and 1500 PhDs qualify in biosciences and engineering each year.

Companies Collaboration
Avesthagen Sequenom R&D
Avesthagen Centre for Clinical & Basic Research (CCBR) and its subsidiary Nordic Biosciences R&D
Avesthagen Cipla R&D
Biocon Nobex corporation R&D
Biocon Vaccinex R&D
Biological E Intercell AG R&D, manufacturing and marketing
Serum Institute of India Lipoxen Technologies Product development
Syngene international Novartis Institute for Biomedical Research Contract research

Source: Frost & Sullivan

Generic synthesis

It is not just the research that is driving the industry. The global market for conventional pharmaceuticals is slowly making way for biopharmaceuticals. Biopharmaceuticals also have different segments to bank on, like compound libraries, cGMP synthesis of drug molecules for clinical evaluation, process development, process optimisation and several other contract research projects.

There are more than a dozen biopharmaceuticals with US patents on the brink of expiry by end of 2006. It is estimated that biotech drug patents worth about $11.5 billion would be expired, creating a colossal market. “There is an acute shortage of biopharmaceuticals manufacturing capacity globally and in the light of numerous biopharmaceuticals going off patent in the next few years. These innovator companies will be faced by competition from generic manufacturers,” reveals Sawant. “Thus, they will have to cut down the cost and look towards more economical sources of manufacturing these products,” he adds.

Some of the Indian companies like Biocon have leveraged this opportunity by stepping into the business of contract manufacturing for many other biotechnology companies in the west. An Indian biopharmaceutical company can not only offer economical manufacturing services but can also provide cGMP certified facilities coupled with skilled manpower and scientific talent, among several others. “India has a natural edge in terms of availability of contract manufacturing of biogenerics, cost-effective R&D and human capital specialised in protein characterisation and expression,” says Gupta.

There is a lot of activity surrounding biopharmaceuticals in India. Following are the areas of biopharma that some companies have chosen:

  • Bharat Biotech (vaccines)
  • Biocon (monoclonal antibodies, biogenerics)
  • Dr Reddy’s Labs(biogenerics )
  • Panacea Biotech (vaccines, antibodies and biogenerics)
  • Serum Institute (vaccines)
  • Shantha Biotech (vaccines)
  • Wockhardt (bio-generics and vaccines)
  • Zydus (biogenerics)

New biologics

– Habil F
Khorakiwala Chairman

Wockhardt Group

With a host of new activities, the biopharmaceuticals market is likely to almost double in terms of its revenue turnover. Globally, firms are developing new drugs to treat diseases associated with aging, including medication for heart disease and stroke, cancer, Alzheimer’s, diabetes and also osteoporosis. India is also home to some of the important research being carried on. As mentioned by Maseeh, in Cadila Pharma, there are several in-house and collaborative research biopharma projects going on. Some of them are in the process of reaching the stage of fruition, by this year end. The company is planning to broadly cover infectious diseases management, cancer, cardiology, gastrointestinal and respiratory ailments. There is a wide scope for biopharmaceutical products in infectious diseases, malaria and Kalaazar along with cardiac syndrome X. Also, products for tobacco induced cancers have a huge market, informs Maseeh. Biopharmaceuticals are being developed to fight cancer, viral infections, diabetes, hepatitis and multiple sclerosis.

Wockhardt’s product pipeline includes interferon, glargine (long acting insulin analogue) and growth factors. “Currently, our more than 25 percent of new research in pharmaceuticals is based on recombinant biotechnology molecules,” says Habil F Khorakiwala, Chairman, Wockhardt Group. “Our biopharmaceuticals have been carefully chosen for their relevance to the prevalence of diseases in India today. We havethree world-class products—Biovac B (Hepatitis B vaccine), Wepox (recombinant erythropoeitin) and Wosulin (recombinant insulin),” he adds.

In order to cater to increasing demand in India and abroad, the manufacturing of biotechnology products has recently been upgraded to international standards. The world scale Wockhardt Biotech park in Aurangabad is set to supply biopharmaceuticals to Indian and international markets. The Wockhardt Biotech Park has six interconnected manufacturing plants. “Our capacities are aimed at catering to global demand for key biopharmaceuticals,” adds Khorakiwala.

Biopharmaceuticals are therapeutic or preventative medicines that are derived from living cells, using recombinant DNA technology. Conventional pharmaceuticals are generally small molecules, whereas biopharmaceuticals are typically proteins, peptides, nucleic acids or inactivated viruses/bacteria. The distinct families of biopharmaceuticals include hormones and enzymes, cytokines and peptides (naturally occurring proteins that regulate or modify the growth of specific cells), vaccines, monoclonal antibodies, antisense drugs and cell therapies. The leading biopharma products are Epogen (Sales: $2.5 billion), Avastin (Sales: $1.1 billion), Humira ($1.4 billion), Remicade (Sales: $2.5 billion).

Challenges ahead

Though opportunities abound for the players wanting to enter the generic biopharmaceutical field, one of the main obstacles for the biogeneric drug market is the lack of clear regulatory rules for the approval of biogeneric versions. Incidentally, even USFDA is yet to create guidelines for generic versions of biotech drugs. “Due to the complex nature of certain biopharmaceuticals, it may still be difficult to manufacture generic versions of the product even after patent expiry,” Sawant rues. India too is struggling with the perception of weak IP protection, a resource-draining bureaucracy.

Maseeh also concedes that though the government has done a lot, regulatory guidelines have become essential. “Although the overall risk or return profile for offshoring to India is favourable, we see the challenges as hardly menacing,” Sawant says and prophesies that they are also declining as the policy- makers and industry players are continuously working to remove these obstacles. The First Indian Biotechnology Policy announced in 2005 should help in structuring guidelines for the Indian biotechnology industry. The policy proposes certain exemptions in custom duties and taxes, which could be beneficial to the biotech industry. Although some biopharmaceuticals have already lost their patent protection and are open to generic competition, experts contend that producing biologics is still a complex task that generic firms should prove their safety and effectiveness. This technical complexity coupled with the lack of regulatory pathways limits the number of generic drug producers capable of winning the battle against pharmaceuticals. Notwith-standing these challenges, the biopharmaceuticals market is poised to grow at a very fast pace due to the lowering efficacy of existing drugs that is increasing the demand for treatment of new diseases.