Contract Research Opportunity for the Indian Pharmaceuticals by wit47392


									Contract Research Opportunity for the Indian Pharmaceuticals
Industry – Indian R&D reborn

Pune, India; April 2007

Soaring drug discovery development times, prolonged regulation-mandated testing,
complex review processes, rapidly escalating R&D expenditures and competition are
hurting the margins of pharmaceutical companies. In an attempt to improve falling
revenues, the pharmaceutical industry has resorted to outsourcing of high-end
services such as drug discovery and development to inexpensive but highly skilled
destinations in Asia.

India has emerged as a preferred destination for outsourcing research services owing
to its low cost manufacturing, lower cost of R&D personnel, lower capital and
operational costs for quality infrastructure of international standards. “The rapidly
evolving skill-set of Indian vendors in basic research and development have
narrowed the skill-gap required for NCE research. This trend is one of the key
attractors for western companies to outsource value added research services from
India” believes Dr R. Rajagopal, CCO KnowGenix.

A new study by Pune-based ValueNotes in collaboration with Mumbai based
KnowGenix, titled "Contract Research Opportunity for the Indian Pharmaceuticals
Industry" shows that outsourcing has helped Indian firms move up the value chain
from contract manufacturing to drug development.

According to Arun Jethmalani, CEO, ValueNotes, “the last few years have seen the
Indian pharmaceutical industry transform from a domestic market focused industry
to a globally integrated industry. The transformation has happened on the back of
cross border acquisitions, alliances (in-licensing and out-licensing agreements) and
by becoming outsourcing partners of multinational pharmaceutical companies.
“Competitive pressures, new growth opportunities, diversification of risk and funding
enablers are some of the key factors behind acquisitions, alliances and outsourcing
partnerships happening across various segments of the industry”, he added.

“The TRIPS agreement signed in 2005, which mandated implementation of the
product patent regime, has seen Indian pharmaceutical companies alter their
business focus and strategies to explore novel and mutually value generating
relationships with global pharmaceutical companies” notes Suchita Chaudhari, Senior
Analyst, ValueNotes.

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Technology developments are happening at a bewildering pace. Such advances not
only create new market opportunities but also set the platform for stronger
collaborative framework for discovery, and development. The end-result will only
mean more business to India. “While the climate is ripe for cross-disciplinary team
research and scientific exchange flourish, challenges surface while handling the
overwhelming amounts of data generated in modern research and their ownership
rights”, cautioned Analyst and co-author Poonam Bhana. Data exclusivity is the key
to attracting foreign investments in the Indian pharmaceutical industry. However,
this would require political will and resources to improve institutions and train
personnel in-charge of implementing IPR.

The ValueNotes/ KnowGenix report estimates that the global contract research
opportunity (excluding clinical trials) is expected to grow at a CAGR of 16.6% over
2005-2011, making the total contract research market worth USD 15.1 billion by
2010. India's total contract research revenues amounted to just USD 75 million in
2006, but it is expected to grow at 23.6% CAGR, hitting USD 175 million by end


About ValueNotes

ValueNotes Database is a leading provider of business intelligence and research, with
expertise across selected domains and types of customer needs. Working with clients
across the globe we have significant understanding of international markets.

About ValueNotes Outsourcing Practice

The ValueNotes Outsourcing Practice is one of the largest information providers on
the outsourcing industry. Our Outsourcing Practice uses a comprehensive, analytical
framework providing fresh insights into the fast emerging and yet, complex
outsourcing space. We extensively track the outsourcing space in-depth through a
regular analysis of news and events and continuous primary research and contact
with the industry.

ValueNotes Database
301, Venus Point, 1226/1 Off F.C. Road, Pune – 411004, INDIA
Tel: +91 20 66010423/24

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Contact person: Arpita Bedekar


About KnowGenix

KnowGenix is a business research and growth strategy service provider with
chemicals, materials and energy practices. The firm researches business and
technology trends in oil, gas, petrochemicals, fine, speciality and life science
chemical value chains besides materials and energy. It assists global clients with
research and growth strategy services through its international alliances.

C/o Chemical Weekly
602, B Wing, Godrej Coliseum
K.J.Somaiya Hospital Road
Behind Everard Nagar
Sion (East) Mumbai 400 022
Tel: 91-22-2404 4477
Contact person: Dr. R. Rajagopal

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