The Hindu Business Line : Make a door of a window

The meltdown may have hit the IT sector but the resourceful can spot other openings, like biosciences. It's a question of making the most of an opportunity.

THAT the global meltdown has hit the IT industry significantly is all too well-known. However, the industry need not lose heart as new opportunities continue to emerge in one form or the other. The global biosciences market, poised for growth over the next five years, with significant IT spend, seems to be the latest opportunity knocking at the doors of the IT sector.

A recent study on `IT Trends and Investment Pattern in Biosciences' by research firm IDC pinpoints India as a potential star in the coming years as pharmaceutical firms and research institutes look forward to cost-effective and high-quality research, development and manufacturing of drugs with speed and cost efficiency.

"By 2005, IDC expects IT spending in biosciences to cross $138 million in India, predominately in the areas of system clusters, storage, application software, and services" according to Sabyasachi, Assistant Manager- Demand Side Research, IDC India. Various industry estimates suggest that revenues from biotechnology are expected to grow five-fold to reach $750 million by 2005, rising to $1.5 billion by 2007, with nearly 60 per cent coming from exports to the global markets. This figure could alter over time, but is more likely to be on the upside, the IDC study says.

Moreover, the government's focus on life sciences provides a great deal of necessary support to develop and deliver innovative products and technologies, build fast-growing and lucrative enterprises, attract international investment and create additional high-value employment opportunities, the study says.

However, India could face a major issue in its transition from a recognised global leader in software development to areas of real strength upon which it can capitalise in biosciences. The identifiable areas are in computation biology and bio-informatics, where a substantial level of development skills is required to develop custom applications to knot together and integrate disparate databases (usually from several global locations), simulations, molecular images, docking programs etc. Bio-informatics is now widely recognised as the crucial practice to integrate, mine, analyse and manage vast volumes of genetic and biological data emanating from R&D organisations worldwide.

Advice to suppliers

IDC also gives a word of caution for suppliers targeting the biosciences area. It suggests to avoid throwing technology "over the wall" and focus on products and services that align with bioscience needs. It further says that demonstrating a true understanding of the IT requirements of biotechnology processes is the key for IT suppliers to bridge the chasm that currently exists between IT and Science. The past two years have seen many large multinational pharmaceutical companies acquiring or developing companies in the biosciences sector. IDC currently forecasts a CAGR (from 2001-02 to 2004-05) of about 10 per cent in the spending on Information Technology by biosciences organisations. Considering the local market is generally less mature than those in the US and Europe, IDC forecasts more aggressive growth beyond 2005, as many of the organisations attempt to play "catch-up". Enterprise applications including data warehousing, knowledge management and storage are being pursued by these companies as priorities.

vishwa@thehindu.co.in

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