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P.T. Jyothi Datta

Despite growth prospects of the biotech industry, the stumbling block for global investors, looking for tie-up with with Indian firms, has been their perception that India's IPR norms are too lax.

New Delhi , Sept. 22

FOR all the brouhaha that biotechnology will be the next "show-piece" industry from Indian shores, global venture capital companies are still not keen on parking their funds in this segment.

And if the $150 million domestic biotech industry is to achieve its full potential — the Government would have to provide a "comfort level" for foreign investors by tightening norms on Intellectual Property Rights (IPR) and removing other similar impediments that hamper growth, point out biotech industry representatives.

"Generally, the US-based venture capital (VC) companies are averse to moving out of their region of operation and prefer funding projects that are close to where they are located. Despite the growth prospects of the biotech industry, the stumbling block for foreign investors and research-driven companies, looking to collaborate with Indian firms, has been their perception that India's IPR norms are too lax.

``VCs tend to be inward looking and we would be able to lure them to look at promising regions and segments of industry only if we are able to fix the perception that the outside world has on IPR protection norms in India," points out an official tracking the biotech industry. Current VC funding in the domestic biotech industry is a modest $20 million.

But even as the Government sets about its task of strengthening the regulatory framework in the biotechnology segment, the industry is bullish on its prospects of clocking revenues of $750 million by 2005 and $1,500 million by 2007.

In a presentation made by the Confederation of Indian Industry at the Asia Pacific Business meet in Berlin earlier this week, the CII said that "select Indian pharma companies were already supplying quality bulk intermediaries and active pharmaceutical ingredients (API) to the big pharma companies in the European Union and the United States. With suitable technology, this can be extended to biotech as well."

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