LifeSciences R&D: India can leverage its unique advantage to play a critical role

Government of India has declared this decade 2010-20 as the ‘Decade of Innovation’ and life sciences innovation will play an important role in this vision. While India can participate in the global biopharma opportunity by virtue of its capabilities, it will need to do so in an increasingly competitive globalised world. Pharmaceutical companies are going outside traditional hubs of Boston, California and Switzerland and investing in increasingly towards what are defined as ’emerging markets’, not just for the commercial opportunity but also for R&D. The motivators are many including securing access to a low cost talent pool, further enhancing their market access or to tap into set of unique capabilities which exist in that market.

Given the level of competition for this spend, unique and sustainable advantage for any new locations to capture this spend is critical. The same is true for India. To attract R&D investment, we need to highlight areas where India is uniquely advantaged and differentiated to develop a compelling value proposition for companies to invest in India.

In our position paper, released this year at the US India BioPharma and Healthcare Summit and commissioned by the USA-India Chamber of Commerce (USAIC) we highlight a framework for companies to plan their R&D investments in India. The report was based on in-depth research as well as input through detailed one-on-one interviews from about 30 global R&D leads.

When we review the starting position, we see that despite much of the talk, India hasn’t been able to deliver sustainable results in delivering new, innovative drugs. Therefore, as we plan ahead, it is important that we look at the strengths of India more broadly and then explore how these strengths can ‘converge’ into the life sciences space. Our framework follows that logic and in the Indian context, we see three areas where India has demonstrated important strengths.

The first is in the area of information technology. India has over time has proven its capability not just in the traditional off-shoring space but also in value added areas of analytics and complex data management. The second is in the area of clinical research. With large patient pools resulting in faster recruitment times combined with significantly lower cost, India has emerged as a destination for clinical trials globally. The third area is in the space of engineering, where India has a long history of excellence driven by its institutes of global repute e.g. IITs but also with companies such as L&T that have demonstrated this engineering excellence not just in India but globally.

When thinking of these strengths and how they might apply in the area of life sciences discovery, we explore the intersection of these capabilities in the context of a disease. We do this to help translate the framework to practical ideas which can deliver value on the ground and differentiate the India R&D value proposition. To illustrate this, we selected oncology which was the disease area of the Summit to illustrate how this might be applied. While these opportunities are specific to oncology, the lessons can easily be translated more broadly particularly in the lifestyle disease areas such as diabetes and coronary heart disease.

The three areas which we detail are highlighted in Exhibit I. We deep dive into each of the three areas where India is uniquely advantaged to move the needle in the oncology space.

The first is in the area of building and maintaining unique high technology assets. We believe India is uniquely positioned to help build these types of assets at a lower cost than anywhere else in the world. This is because of the existing IT capabilities in terms of both the infrastructure and the skilled manpower needed to build and maintain these assets. In the oncology space, this could translate to developing a vast database of cancer-specific genetic information through genomics and proteomics studies. This database can be used to identify new biomarkers for personalised medicine as well as develop better clinical research models for more accurate R&D.

The second area revolves around creating process efficiency through translational research hubs. Given the patient population which drives faster recruitment times it is possible to translate basic research to therapies faster and at a lower cost in India. This leads to faster proof of concept results and more relevant drug R&D. Within the area of translational research, an interesting example is the Medanta-Duke Research institute. Their focus is on faster proof of concept in India using Medanta’s patient flow and quality manpower combined with world-class clinical data management expertise. Duke brings to the table global expertise and an international network, truly a win-win arrangement.

Finally, the third area sits at the intersection of engineering and life sciences where we see clear opportunities in applied research. India has traditionally been very strong in adapting and improving engineering applications and we see that India can contribute significantly
in the area of nano-technology. Nanotechnology engineering expertise can be brought to play to develop new diagnostic techniques as well as new drug delivery systems to enhance the effectiveness of therapies being developed in the space of oncology today.

While these opportunities are unique and provide sustainable advantage for India, all of this is not possible without a supportive policy environment, as we learn from our clinical research deep dive. We see that India is advantaged in the clinical trials space as it offers relatively faster trial timelines and lower costs. Further, India provides unique opportunities for innovation through access to a large number of treatment naïve patients.

However, the market, currently estimated at $0.4 billion, is considerably behind forecasted expectations of more than $1 billion. In fact, China has overtaken India in the share of new trials, from a ratio of new trials started in China to India at 1:1 in 2008 increasing to 2:1 in 2011. Inconsistent policy and infrastructure gaps have contributed to this slow down. The absence of a public forum to emphasise the importance of clinical trials and coordinate efforts of relevant stakeholders only complicates the problem.

While China has a large commercial opportunity which drives the continued uptick in clinical trials, India’s advantage relies a lot on support from the policy front as the commercial opportunity is not as large. We looked at Korea closely to understand the impact of clear policy on the clinical trials market. Policy steps, taken to align with international guidelines and to streamline the approval process helped stimulate the market in Korea, making it a top 10 preferred destination for trials globally with a few short years from a rank of 30+ before the changes in policy.

Building off the learning from Korea on the policy front, we believe there are three elements which will need to be put in place to support the development of a vibrant innovation ecosystem. The first step will be to implement an advocacy forum to bring together all the stakeholders and coordinate efforts. Once this advocacy forum is in place, an important agenda for this forum would be to work closely with policy makers to set guidelines, streamline processes, build capacity in the administration, and finally encourage infrastructure investments in the space. Finally, as things start to take off, we will hit an infrastructure bottleneck. We need to plan for this and encourage capacity building accordingly. The government will need to play a role to stimulate investment in infrastructure and training, but the industry will need to play a much larger role here. Big pharma and academic institutes will need to invest in to ensure appropriate quality is available as the industry begins to ramp-up. Providers will need to invest in building infrastructure, not just in Tier-I cities but also in Tier-II and Tier-III cities as well.  To summarise, in order to build an innovation hub in India, global biopharma needs to tap into areas that are an extension of capabilities where India is uniquely advantaged. We showcase the potential road-map for lifesciences innovation in India in Exhibit II. When thinking about R&D investment and strategy, we urge companies to consider three areas where India can be leveraged: i.e. capturing economic advantage through building and maintaining unique assets; creating process efficiencies; and capitalising on technological advantage to drive more applied research in emerging areas. We shared examples in oncology but much of this learning can certainly apply in other diseases as well e.g. coronary heart disease treatment data to track therapies which have better long-term disease outcomes. Finally, to support all this, we highlighted that the right environment is vital for India, and the government must recognise the role it can play in moving the needle if this is indeed to become the ‘decade of innovation.’
Views expressed by the authors are personal