Stategies of leading MNC's give equal importance to both countries
-Ramesh Srinivasan, Principal, McKinsey & Company, US
With the blurring of geographical boundaries and the world shrinking to
become a 'global village', life sciences companies are actively looking
at tapping the opportunities in the developing countries. In an
exclusive interview with
BioSpectrum, Ramesh Srinivasan,
Principal, McKinsey & Company, US, expresses his views on the
opportunities that developing countries have to offer in the coming
decade, the debate on India and China, and his optimistic opinion on
the Drug Controller General of India.
the emerging markets have the capabilities to prove themselves in the
drug discovery space rather than drug development?
If you look at R&D investments made by multinational companies
(MNCs) in the emerging markets, you will notice that most of them are
mainly looking at drug development, supporting clinical research, data
management and support services for drug development. But, that trend
is changing now, as these regions, especially India, are also looking
at basic drug discovery research and innovation. In India, companies
are setting up research centers like the Bristol-Myers Squibb
(BMS)-Biocon Life Science Center for Excellence in Bangalore for drug
Similarly, many other global companies are partnering with Indian
companies for discovery research. Even in China, you will see that
people are making investments in basic research as well. Most of the
big names have made early inroads and it is going to become a part of
their global discovery operations that also depends on the research
findings. As they get comfortable in these regions, I can see these
operations becoming bigger.
aggressively are the top global companies looking at the emerging
markets in order to be at par with the regional companies?
It is very difficult to point out who will lead the market in
these regions, but it would be fair to say that most of the
pharmaceutical companies are looking at the emerging markets in a big
way and it is one of the top three priorities on their list. If you see
the top global companies, they have publicly talked about penetrating
these emerging markets whether it is Pfizer, GSK, Novartis or
Sanofi-Aventis. For the next 5-10 years, we have to wait and watch how
these markets shape up.
the regulatory structure in India a challenge for the growth of biotech
Actually, I am quite optimistic as far as the regulatory structure in
India is concerned. With the introduction of the product patent in the
country, MNCs are getting comfortable here and are open to launch their
products here. I also see that the DCGI is very progressive about
enabling clinical research, which today has become much easier in
India. At the end of the day, you have to protect patent rights that is
the responsibility of the government and the DCGI is working towards
this direction by making changes to make things easier.
number of companies from India and China are looking at biosimilars
space in the US and Europe. What will determine the success of this
Biosimilars is a sensitive and complex area. Even after the launch of
biosimilars in the US, there will be brands, which physicians have to
prescribe for their patients. The issue of substitution will not be
that intensive here, and above all, we need to see how many competitors
we get to see in the biosimilars space as compared to small molecules.
So, as of now, the dynamics of the market will depend on how many
companies will enter this space and at the same time how stringent are
the regulations around the issue of substitution. This can change the
relative attractiveness of the market. There might be a possibility of
the market becoming less attractive like small molecules. So, it is
still an open question as to how this market space will develop.
India and China, which country has the chances of being the leader in
the life sciences space?
In future, companies cannot afford to ignore either India or China.
Both these regions have their own set of challenges and advantages. It
is a question of how a company looking at entering these markets gets
to see a long-term growth in both these countries. Both India and China
are at par with each other now. The strategies of most of the leading
MNCs across the globe are looking at both the regions and not just one
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