Ecosystem issues: While we achieved success with generic drugs in pharma sector, we aren’t able to replicate the same in drug discovery, biomarkers and biosimilars. The countless procedures, lack of infrastructure, dependency on private sector and lack of an ecosystem to set up good institutes and centres of excellence have held up Indian innovation.
Finance constraint: Very few entrepreneurs and venture capitalists want to invest in any company/institute/product, which has a wait period of 8-10 years to be profitable, especially when policy is unpredictable. Government procedures make R&D difficult and time consuming. Lack of infrastructure and skilled people worsens the situation.
Capital risk: Innovation means capital risk. No success happens overnight, you have to make multiple attempts or even more than 10 times to achieve true innovation. This would mean for one success you would have to write off money for those nine failures. Banks rarely evaluate balance sheet intangibles such as intellectual property.
Beyond tax breaks: Though investment in R&D is increasing, it is insufficient to meet the needs of innovation. Besides the government can remove import taxes on equipment and consumables, reduce capital taxes for angel investors, allow easy visas for foreign personnel to visit and work.
Sam Santhosh is the Founder and Chairman, MedGenome, a genomics company that does