A Canadian report has come out with news that would gladden the heart of investors of Indian biotechnology companies, as well as strike fear in the minds of their western rivals.
According to lead reporter Peter Singer of the McLaughlin-Rotman Center for Global Health in Toronto, Canada, " India is innovating its way out of poverty and ill health".
The report published in Nature Biotechnology, covers about 21 Indian biotechnology companies.
Accordingly, Indian firms, with low wage costs, are all set to make generic drugs when those produced by big Western firms lose patent protection. In addition, they are increasingly trying to develop new drugs that could compete worldwide.
In the meanwhile, it is well known that India's IT firms have won market share in everything from data analysis to call centers.
Says Singer: "At the moment we think of biotech in India as the baby elephant where information technology is the adult elephant. But that baby elephant is going to grow.
"Any biotech or biopharma player in the industrialized world that doesn't pay careful attention to the innovation that's happening in India ... is not taking a very strategic and global look at their business", Singer opined.
Yet India could be both potential partner as well as competitor, says Singer, though these companies are "yet to produce a truly innovative health product with a stamp 'Made in India'".
Among successes, the report names the 1997 launch of the hepatitis B vaccine Shanvac-B by Shantha Biotechnics which had caused a tumble in prices to about $0.50 per dose from $15 for a comparable imported product.
Shantha's vaccine now makes up almost 40 percent of hepatitis B vaccines for the U.N. Children's Fund (UNICEF), distributed throughout the developing world.
The Serum Institute of India has become the nation's largest vaccine supplier and exporter, with products sold in 138 countries. The company claims to be the world's largest measles vaccine maker.
The report also accounted that foreign competitors, who have sometimes tried to undercut Indian makers' prices with products such as insulin produced by Biocon, have found that Indian companies can price their items even lower.
At the same time there are also concerns that the promise of profits may divert much-needed attention away from research into diseases like tuberculosis and malaria that plague the developing world, and which western companies aren't likely to focus on.
India has the highest number of TB infections in the world with 1.8 million new cases each year, and nearly 350,000 Indians die of the disease annually. Malaria kills hundreds each year, especially in India's poor northeast region.
According to India's Association of Biotechnology Led Enterprises, the country's total biotech exports in the financial year that ended March 2006 were $763 million. Health-related biotechnology exports were nearly 75 percent of total Indian exports.
The report is expected to help set the agenda for a global meet in Toronto, where about 20 to 30 North American biotech firms and about 25 Indian, Chinese, Brazilian and African biotech firms will meet.