The policy, called the National Biotechnology Development
Strategy, was unveiled by Sibal and Bhan on March 31. The draft policy has been
made public to invite wide comments. A quick reading indicates that it is
clearly an industry-friendly policy with most of the major demands of the
industry finding prominent mention in it.
BioSpectrum had pro-actively sought the policy maker's
attention to the demands of the industry in the last two years and the
BioSpectrum Awards Nite on December 10, 2004 in Bangalore was one of the forums
for a lively discussion on the policy draft.
"We want the Biotech Strategy to be the road map for the
next ten years in this sector. It aims to make the processes easier, quicker and
friendly for the common man. The policy will provide adequate support to basic,
translational and clinical research. Up to 30 percent of biotechnology research
budget (of Rs 200 crore) will be spent through public-private
partnerships," Sibal said.
Regarding regulatory approvals for the biotech sector, he
commented, "This (regulatory approvals) is on top of the agenda to make
approvals a lot more simpler and faster. The recommendations of the Swaminathan
Committee for agri-biotech and the Mashelkar Committee for bio-pharma would be
implemented and the effort will be to train scientists and technology transfer
professionals in handling Intellectual Property Rights issues. Regional
technology transfer cells will be created to provide high caliber, specialized
and comprehensive technology transfer services."
Dr Bhan said, "We have two goals. One is to benefit the
ordinary people and help the country's development. The other is to promote
innovation." "A major aim of the Strategy is the development of human
resources. We plan to set up centers of excellence in the fields of marine
biotechnology, animal biotechnology, herbal medicine, molecular medicine and
bio-informatics," he added.
A major policy statement is the announcement that there will
be no restriction on the quantum foreign direct investment (FDI) in biotech
companies. Sibal and the policy clarified that there "may not be the need
for FIPB (foreign investment promotion board) approval for equity investments in
biotech companies." n
N Suresh and Rolly Dureha
Highlights from the draft
The Indian Biotechnology sector is gaining global visibility
and is being tracked for emerging investment opportunities. Human capital is
perceived to be the key driver for global competitiveness. Added to this is a
decreasing appetite for risk capital in developed countries, which has led to a
decline in the biotechnology sector in these regions where survival lifelines
are being provided by the lower cost research environs of the developing world
such as India.
For a country like India, biotechnology is a powerful
enabling technology that can revolutionize agriculture, healthcare, industrial
processing and environmental sustainability.
The Indian biotechnology sector has, over the last two
decades, taken shape through a number of scattered and sporadic academic and
industrial initiatives. The time is now ripe to integrate these efforts through
a pragmatic National Biotechnology Development Strategy. It is imperative that
the principal architects of this sector along with other key stakeholders play a
concerted role in formulating such a strategy to ensure that we not only build
on the existing platform but expand the base to create global leadership in
biotechnology by unleashing the full potential of all that India has to offer.
BioAgriculture
Transgenic plants should not be commercialized in crops/commodities
where our international trade may be affected. However, their use may be allowed
for generation of proof of principle, strictly for R&D, their alternate
systems are not available or not suitable.
Biotechnology can deliver the next wave of technological
change that can be as radical and even more pervasive than that brought about by
IT. Employment generation, intellectual wealth creation, expanding
entrepreneurial opportunities, augmenting industrial growth are a few of the
compelling factors that warrant a focused approach for this sector.
However, emphasis should not be on edible vaccines for which
use in real life condition is difficult. Nutrition and balanced diet are
emerging to be important health promotional strategies. Biotechnology has a
critical role in developing and processing value added products of enhanced
nutritive quality and providing tools for ensuring and monitoring food quality
and safety.
A precautionary, yet promotional approach should be adopted
in employing transgenic R&D activities based on technological feasibility,
socio-economic considerations and promotion of trade.
Fiscal and trade policy initiatives
Biotechnology firms are by far the most research intensive among
major industries. On an average, the biotechnology sector invests 20-30 percent
of its operating costs in R&D or technology outsourcing. Government support,
fiscal incentives and tax benefits are therefore critical to this sector. These
measures will also help to capitalize on the inherent cost effectiveness of the
Indian biotech enterprise. The suggested interventions include:
• Exemption of import duties on key R&D, contract
manufacturing/clinical trial equipment and duty credit for R&D consumer
goods to enable small and medium entrepreneurs to reduce the high capital cost
of conducting research.
• Extending the 150 percent weighted average tax deduction
on R&D expenditure under section 35 (2AB) until 2010 and to permit
international patenting costs under this provision and enable eligibility of
expenditure incurred with regard to filing patents outside India for weighted
deductions u/s 35 (2 ab)
• Enable lending by banks to biotech companies as priority
sector lending. Currently banks are almost averse to lending to young biotech
companies. In order to encourage banks to lend and provide banking services to
the biotech sector, a significant push through appropriate policy guidelines
from the Reserve Bank of India is necessary. Currently lending to agri-businesses
as well as investment in Venture Funds by banks is categorized as Priority
Sector Lending. Biotech as a business has similar characteristics in terms of
risk as well as gestation time lines and it is therefore recommended that
lending to Biotech be also categorized as Priority Sector lending.
• Remove customs duty on raw materials imported into India,
where the finished product is imported duty-free. Life Saving Drugs imported and
sold in India are exempted from paying customs duty; whereas raw materials for
diagnostics and other pharmaceutical biotech products manufactured in India are
levied customs duty. To promote the indigenous manufacturing industry and make
it competitive globally, raw materials imported by Indian manufacturers should
be eligible for Duty Drawback.
• Rationalization of import and export of biological
material is considered critical for clinical research and business process
outsourcing.
• Simplification and streamlining of procedures for import,
clearance and storage of biologicals, land acquisition, obtaining environmental
and pollution control approvals would be simplified and streamlined within
shorter time frame lines through consultations with various central and state
government departments.
• As an effective regulatory mechanism has been put in
place though recent interventions, Foreign Investment Promotion Board (FIPB)
approval for equity investment may no longer be necessary.
• Joint R&D collaboration and generation of joint IP
through global partnerships would be fostered.
• International trade opportunities would be promoted to
guide R&D investment Indian biotech strengths would be aggressive by
promoted globally.
• Efforts would be made to remove hurdles for contract
research especially for input output norms and tax on revenue generated through
contract research/R&D.
• Easy access to information, regarding legislation and
rules and regulations for transboundary movements of biologicals would be
promoted.
• Current standards and safety of products would be
enhanced.
• Efforts would be strengthened to promote acceptance of
Indian regulatory data internationally.
• Research, trade and industrial partnership would be
fostered at regional and sub-regional levels.
• A "cluster" approach would be encouraged to
operations. One significant feature of the industry is the fluidity and variety
of its inter-company relationships, traditionally much greater than in other
industries. It has relied to a considerable degree on contracting and
outsourcing, especially "upstream" in R&D through various
licensing arrangements and "downstream" through co-marketing
agreements.
• Collaborative knowledge networks would be promoted.
Expanded sharing of information, including creation/use of collaborative
knowledge networks (CKN), can greatly enhance a company's performance under a
cluster approach. Managing the many external relationships is complex. Flexible
and pervasive communications systems that allow information to flow effortlessly
within and between contracting organizations will provide the key to success.
Increasingly, IT advances, including web-based approaches, will provide the
foundation for these systems.
Financial incentives
Availability of financial support for early phase of product
development to establish proof-of-principle is the key to sustaining innovation.
In this context, it is proposed to institute 'Small Business Innovation
Research Initiative' (SBIRI) scheme through the Department of Biotechnology in
2005-06 for supporting small and medium size enterprises as a grant/loan.
Companies with up to 1000 employees will be eligible. The scheme will support
pre-proof of concept, early stage innovative research and provide mentorship and
problem solving support in addition to the grant/soft loan. The SBIRI scheme
will operate in two phases of innovation and product development.
Biotech Parks
• The Department of Biotechnology will promote and support at least 10 biotech
parks by 2010. Each park will necessarily meet the qualifying criteria related
to the characteristics of the location, a viable business plan, management
strategy and a clear definition of the partners and their roles.
• The Department of Biotechnology will support creation of
incubators in biotech parks promoted by a private industry or through
public-private partnership in the form of grant upto 30 percent of the total
cost or upto 49 percent in the form of equity.
• It is proposed that a central body Biotechnology Parks
Society of India (BPSI) be set up for the promotion of biotechnology parks in
the country on the same lines of the Software technology Parks of India (STPI).
The BPSI should be run by professionals having experience in the areas of
biotechnology, knowledge in Acts and Rules relevant to biotechnology and
management skills. The existing parks can become members of these new biotech
parks. The BPSI would be responsible for evaluating the project proposals and
advising the Department of Biotechnology on the funding pattern; facilitating
industries in obtaining industrial, environmental and other relevant approvals
from the central government; making recommendation regarding fiscal incentives
to be granted to the biotechnology parks; providing guidance to the venture
capital institutions on investment in biotech parks; providing accreditation to
the parks etc.
• Concessions to biotech companies located in biotech parks
Biotech companies located at biotech parks are eligible for
benefits as per the recent changes in the Foreign Trade Policy:
• Duty free import of equipment, instruments and
consumables.
• Tax holiday under Section 10A/ 10B of the Income Tax Act
A scheme will be put in place for operationalizing of the
incentives to biotech units located in biotech parks. As a part of this scheme
biotech company located in biotech parks to be allowed a five-year time frame to
meet the export obligation norms under the SEZ scheme. This measure helps to
address the long and unpredictable gestational time lines that are inherent to
biotech product development.
Regulatory mechanisms
• The recommendation of the Swaminathan Committee on regulation of agri-biotech
products and of the Mashelkar committee on recombinant pharma products will be
implemented in 2005
• A competent single National Biotechnology Regulatory
Authority be established with separate divisions for agriculture
products/transgenic crops, pharmaceuticals/drugs and industrial products; and
transgenic food/feed and transgenic animal/aqua culture. The authority is to be
governed by an independent administrative structure with common chairman. The
inter-ministerial group will evolve suitable proposals for consideration of the
government.
• A center for in-service training of all professionals,
irrespective of their location, engaged in the regulatory process to be
established by the Department of Biotechnology in close collaboration with other
concerned departments and institutions.
• All existing guidelines to be updated and made consistent
with the recommendations of the Swaminathan and Mashelkar committees in 2005.
New guidelines on transgenic research and product/process development in animal,
aqua culture, food, phyto-pharma and environmental application to be put in
place in 2005 by the concerned ministries/departments
As an interim measure, a special regulatory cell will be
created by the DBT to build capacity in the country for scientific risk
assessment, monitoring and management, to foster international linkages, support
biosafety research; to obtain and review feedback from different stakeholders
and provide support to industry and R&D institutions. This cell will only
have a promotional and catalytic role
• It is recommended that an event that has already
undergone extensive biosafety tests should not be treated as a new event if it
is in a changed background containing the tested and biosafety evaluated
"event". Where adequate evidence is available that the recurrent
parent genetic background of a notified/registered genotype is nearly restored
(through field data/molecular data), only the agronomic performance and the
level and stability of the transgene expression may be analyzed by two-year
trial data by the ICAR. Even in case of a structurally altered transgene with no
significant modifications in protein conformation, the toxicity and
allergenicity tests need not be carried out provided the predicted antigenic
epitope remains the same and the level of expression of the transgene is within
the defined limits. For the released event, Department is of the view that there
is no need of large-scale trials under the Genetic Engineering Approval
Committee, as the biosafety aspects have been already addressed adequately
before releasing the "event". Only ICAR trials may address the
agronomic evaluation of the crop.
Create a cadre of resource persons
-
Creation of a cadre of resource persons to provide
credible information based on scientific data
-
Training media personnel through Institutes of Mass
Communication, colleges of journalism and others
-
Capacity building among extension personnel in
agricultural, fisheries, veterinary and medical sectors
-
Involvement of Panchayati Raj institutions in the process
of analysis and understanding the risks and benefits associated with GMOs as
they will be playing an important role in the local level management of
bio-diversity, access to benefit sharing etc.
-
Awareness generation among undergraduate and
post-graduate students in universities, colleges etc on issues related to
biosafety.
-
Promoting a genetic literacy movement within government
and public schools through 50 genome clubs nature clubs each year.
Empowering the judiciary
Institutional mechanisms for strengthening public
trust
-
Establishment of a dedicated training center for
biosafety, food and nutrition safety and standards as per codex alimentarius
committee
-
Creation of a 'National Biotechnology Awareness Fund'
for providing support for the education and preparation of educational
resource material for various sections of stakeholders in different regional
languages of the country
Single Window Clearance
-
Department of Biotechnology will act to facilitate a
Single Window Clearance mechanism for establishing Biotechnology plants.
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Encourage private participation in infrastructure
development like roads, water supply and effluent treatment.
-
Depositories of biological materials will be created in
partnership with industry on IDA model for agriculturally important
organisms, medically important organisms, plasmids, cosmids and constructs
of special nature generated with adequate human interventions
-
State of the art large animal house facilities with GLP
will be created for testing candidate vaccines and biotherapeutics. Testing
facilities will be created for GMO/LMO
Innovation
-
Basic and translational research in key biological
processes and new materials will be supported as innovation for tomorrow.
Access to the knowledge generated will be improved by supporting knowledge
and social networks among stakeholders so that those with appropriate skills
can convert the research output into useful products and processes.
-
Research to promote innovation must be supported
increasingly on a cooperative rather than a competitive basis. This requires
effective communication among science agencies, research institutions,
academia and industry.
-
To promote India as a hub of innovation, a network of
relevant stakeholders should be developed. Public investment should be used
as a catalyst to promote such clustering and networking as this can lead to
enhanced creativity by sharing of expertise, resources and infrastructure.
-
Availability of human resource would be ensured at each
phase of the product cycle.
-
Strengthening technology transfer capacity
It is proposed to create several national/regional technology
transfer cells (TTCs) over the next five years to provide high caliber,
specialized and comprehensive technology transfer services. The services would
include evaluating technology and identifying potential commercial uses,
developing and executing and intellectual property protection strategies
identifying potential licensees and negotiating licenses. Each TTC would service
a cluster of institutions in a region or a large city.
National Task Force on education & training
A National Task Force will be created to formulate model
undergraduate and postgraduate curricula in Life Sciences keeping in view,
future needs. The said curricula must address the underlying need for
multi-disciplinary and inter-disciplinary learning and the appropriate stage for
biotechnology training.
Need assessment
There would be need assessment in 2005 for the next five
years and close monitoring during the period for interim changes.
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