29 May 2007

Just like pieces of a jigsaw puzzle, biotechnology in New Zealand and India fit together nicely. That’s the verdict of Kiran Mazumdar-Shaw, the founder, Chairman and Managing Director of Biocon, one of India’s leading biotechnology companies, after her recent tour of New Zealand.

What New Zealand lacks – size, population and low-cost drug development – India has in bulk. On the other hand, says Mazumdar-Shaw, Indian companies struggle to find a healthy drug discovery pipeline. That’s something overflowing here.

“For a country New Zealand’s size,” says Mazumdar-Shaw, “it’s natural to focus on innovation. [New Zealand] universities encourage and foster innovation in a very good way. We are very envious of that!”

But the differences aren’t threats, she says, they are opportunities for collaboration. Even though worldwide biotech innovation is at an all-time high, she says, most drugs are at early stages of development – and the cost to get them to market is extraordinary. It’s a conundrum: as big pharma faces a drug famine, small biotech companies are facing a financial crunch.

The biotechnology business is about partnering in a borderless world, she says, and companies that learn to access global opportunities are those that will succeed. Become parochial and only look on your own soil and you have very little chance of being a significant player.

Biocon – which was the first Indian biotech company to be listed on a stock exchange and was oversubscribed by 33% on its initial public offering (IPO) – has clearly left behind the worries of a small, under-financed start-up. It’s at the point of searching for products to license and co-develop.

“When we started to look at the pipeline,” says Mazumdar-Shaw, who travelled to New Zealand under Investment New Zealand’s Visiting Investor Programme, “we realised access to innovation from Indian universities and small companies was very, very frugal. That’s when we started outsourcing innovation from other parts of the world.”

It was no surprise to Michelle Sullivan, Investment New Zealand’s Biotechnology Investment Manager, that Biocon was impressed by New Zealand companies, particularly those that share the diabetes and oncology space.

“Certainly,” says Sullivan, “New Zealand has strength in diabetes research, which is also a focus for Biocon. Likewise,” says Sullivan, “New Zealand has remarkable cancer research and Biocon’s first drug to market was a monoclonal antibody for solid tumour treatment.”

On a broader level, Sullivan was encouraged by Mazumdar-Shaw’s visit and believes it will help open doors for New Zealand companies. “Biocon is one of India’s most successful biotech companies,” she says, “and a solid relationship with it is of strategic importance to New Zealand.”

“We can bring a lot of value to a small innovator,” says Mazumdar-Shaw. “We are looking for companies that have something to offer and we can add high value to them; they don’t see us as a typical big pharma that really doesn’t leave much on the table. We believe we will be really fair and we can partner in a just way.”

In addition to scouting out partnering options, debunking credibility hurdles was a goal for Mazumdar-Shaw’s recent trip. Some hurdles are real, she says, like India’s meagre discovery-led pipeline. But, she challenges, it is an incorrect perception that India has inadequate patent protection.

“The reality,” she says, “is that the survival of a company like Biocon is based on intellectual property (IP) protection and the mindset today is about respecting IP.”

What will really make a change in credibility perceptions and hurdles, she says, are new product launches that take place in India. That won’t be far off: India is being taken seriously. There are more than 280 companies in the Indian biotech sector and among the big pharma pursuing drug development in the country are Merck, Eli Lilly, GSK, AstraZeneca and Pfizer. In March, Syngene, a Biocon spin-out and provider of research services, announced a partnership with Bristol-Myers Squibb.

But there’s still plenty of room for New Zealand to bring its excellence to India’s playing field.

“New Zealand has very impressive innovation,” says Mazumdar-Shaw, “and I think India has very good development capabilities. I firmly believe if you can marry these two, you have a very synergistic and powerful story to take to the world.”

For more information, please contact:

michelle.sullivan@investmentnz.govt.nz

+64 9 966 9205