The Changing Geography of Ideas - Telfer School of Management · 2018-02-01 · 34 new patents The peoples car@$2500 ‘Gandhian engineering’ No radio, power-steering, AC, one wiper

The Changing Geography of Ideas

Resurgence of India Innovation Inc.

Praful Naik, Ph.D.Chief Scientific Officer – Bilcare Limited

India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008 2

Busting myths about Indian Innovation


Myth #1

Look west for ideas


3rd HOTSPOT FOR INNOVATION –WORLD INVESTMENT REPORT (2005)

100 leading Global MNC have R&D hubs in India

Growth of corporate R&D 17% (North America -5.2%, Europe – 2.3%)

(Source: Booz Allen Hamilton 2007)

Source: UNCTAD (2007)

2.9

2.9

2.9

2.9

4.3

5.8

7.2

11.6

13

13

24.6

29

33.3

0 5 10 15 20 25 30 35

Taiw an

Sw eeden

Russia

Netherland

Canada

Brazil

France

Japan

Germany

UK

India

US

China

“WHERE IS RESEARCH HEADED?” % Responses

Base : 68 Largest MNC spenders on R&D


Myth #2

‘Copycats’ of US/Europe


India China

341 424 US Patents Granted (2003)

1993 2003

54 1164 US Patent ApplicationsSource: US Patent Trademark Office

2004 2006

17266 23000 Indian Patent Applications

1999 2003

12500 15600 ISI Thomson Scientific PapersSource: Indian patent facilitation center

Source: World Intellectual Properties Organization (2006)

Huawei Technologies (China)84

LG( Korea)125

Biowindow Gene Development ( China)136

Samsung (Korea)184

CSIR (India)184

Top 5 Patent Cooperation Treaty Applicants from Developing Countries(2002)No

, Source OECD

0.440.43

0.39

0.31 0.3

0.250.24

0.2

0.17

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

0.5

Chi

na

Indi

a

Turk

ey

Slov

enia

Kor

ea

Pol

and

Chi

nese

Tai

pei

Sin

gapo

re

Cze

ch R

epub

lic

Total Patenting Growth rate High&Medium High-Tech

Medium Low & Low-Tech

ANNUAL GROWTH RATE OF PATENTING

PCT Filings 1997-2004


TATA NANO

FIRST of its kind car in the world

34 new patents

The peoples car@$2500

‘Gandhian engineering’

No radio, power-steering, AC, one wiper

Reengineered car for cost reduction

Confirms to environmental standards (Euro 4 Emission Standards)

Meets Front and Side Impact crash ratings

Made four wheeler accessible to millions of people worldwide

TATA NANO


Myth #3

Agricultural not Technological focus


INTEL INDIA CO DEVELOPED TERAFLOP CHIP

Powerful programmable processor

Can be used for diverse research applications for scientific experiments, oil exploration number crunching

Involved in logic, circuit and physical design

Developed in a record 20 months

MICROSOFT RADIO FREQUENCY IDENTIFICATION MICROCHIP

Product security and identification

Adopted by Wal-Mart and Gillette


GE JFWTC

Set up John F. Welsh Technology Center in 2000

Designing GEnx engine which powers Boeing Dreamliner 787 and Boeing 747

Designing simulations to control bird strikes and fan blade outs in

MOTOROLA RESEARCH LABS

30 Full time researchers and scientists

40% of all software in Phones (including Motorazr)

Multilingual displays, speech recognition

Developing noise cancellation technology

GENX ENGINE

MOTORAZR


HIV MONITOR

ReaMetrix developed immune monitoring test

Cuts cost of testing by 1/5th

Maintained dry state so can be transported easily without refrigeration

Supplying to Africa, Brazil

BIOCON

Filed for over 800 patent applications worldwide

Over 130 granted patents

R&D focus – growth of 36% in R&D expenditure in 2006—07


Myth #4

Basic NOT appliedKnowledge


AKASHGANGA – AUTOMATIC MILK COLLECTION SYSTEMCut time from 5 minutes to 30 seconds

Milk analyzed on six parameters

Monitors adulteration through analysis

E-CHAUPALTransforming business in rural areas

Computer in local farmer’s house -Serves about 600 farmers

Information disseminated/collected in surrounding areas by VSAT

More value and productivity

Accurate price

AKASHGANGA

E-CHAUPAL


SUZLON

Top three wind players in wind energy sector ( From <10 in 2002)

Factories in US/China, Operates in 14 countries

Unique proprietary turbines for cost advantage

Has 7% global market in 2008

Set up innovation center in Denmark

SUZLON TURBINES


KANSO

Two seater 100 cc car

Powered on solar energy – upto 320 watts of power

Cost - $3750

E-BIKES

Rs.13000 bike that runs on electricity

Environmentally friendly(saved $1mn in fuel cost per month)

KANSO CAR


What has led to this resurgence?


#1

The Economic Engine


0

2

4

6

8

10

12

14

Wor

ldO

utpu

t

US

A

Eur

ope

Japa

n

Chi

na

Indi

a

Bra

zil

Mex

ico

Rus

sia

2005 2006 2007 2008E

All India: Age split in %

14.4 12.2 13.6 14.7

26.3

12.6

4.3

1.9

0

5

10

15

20

25

30

12-1

6

17-2

0

21-2

5

26-3

0

31-4

5

46-6

0

60-7

0

71+

Technopak Consumer Outlook 2007

Rank India

2 Emerging Markets

4 Economy by PPP terms

3 Largest Economy (2050E)

SOURCE: GOLDMAN SACHS 2007

SOURCE: TECHNOPAK CONSUMER OUTLOOK @))&

Median Age 24yrs

Population > 60 years6%

Population <35 years65%

Earning Population60%

Dependency Ratio< 40%

GDP GROWTH RATE

SOURCE: State of Indian Economy (2007)


#2

The Intellectual Capital


400 Government Research Labs

1300 Industrial R&D Units

21 R&D staff /1000Department of Science and Technology

(Farrell)

% of students in Engineering 11.20%6%(NCAER) /(Indian Science Report)

Annual Enrolments at Graduate and Above 9.84mn 6.6mn

20041996

Ministry of HR

Institutes of National Importance13

Deemed Universities96

Universities229

UGC and Mashalkar Estimates

Annual Science PhD's~6000

Estimated to grow to (2015)1400000

Annual Engineering Graduates350000


30000 Returnees of IIT from Abroad (3yrs)

40% Drop in no of IITians going to US (NASSCOM 2007)

60,000 Total IT professionals returning

Ministry of external affairs (2004)

Indians responsible for tech firms start up in US20%

Median earning of Indian origin (US Average$38885)$60093

Number of Non resident Indians20mn

GE20

Biocon10

General Motors50+

Monsanto30

Returning Indians to total Employees%


#3

The Financial Capital


$261.1bn Forex Reserves (2007)$21.25bn Foreign Inst Investment (2007)

$6.6bn Foreign Direct Investment (2007)State of Indian Economy, CII Paper Oct 2007

0

50

100

150

200

250

300

350

2000 2001 2002 2003 2004 2005 2006(E)0

1000

2000

3000

4000

5000

6000

7000

Value of deals (USDmn) Number of deals

INCREASE IN VC

National Innovation Project sourcing $6bn VC from World Demos 2007

Venture capital amount doubled since 2000Demos 2007

Nokia + Intel investing $250mn in VC Demos 2007

INCREASING MONEY FLOWS


SCORPIODeveloped at 1/10th cost of similar model abroad

SARASPassenger plane developed for $11mn

INTELAverage Annual cost to design a chip 1/10th of Silicon Valley

Average Salary of Indian in R&D 1/10th of Europe

0

20

40

60

80

100

120

World India, China

1.1 1.8

5.5

16.6

24

0

5

10

15

20

25

30

China India Poland UK Germany

Average hourly wages in USD

Bayer Crop sciences

Average Investment in a Chemical Plant

Bayer Crop sciences

COST ADVANTAGE IN INDIA


#4

Enabling State Support


0.80% Current R&D as % of GDP

2%Planned R&D as a % of GDP (2012)

40% R&D Investment CAGR

$ 4.5bn Annual Science Budget

24% Increase in Annual Science Budget

Intellectual Property Protection

2004-05 2005 -06

Patent applications: 17466 24505 (↑40%)Patents Granted: 1911 4320 (↑125%)

Government of IndiaMinistry of Commerce and Industry

Controller General of Patents Designs and Trade Marks

$230mn “National Science and Engineering Foundation” (Fundamental Research)

Various tax exemptions and benefits for R&D


#5

The Private Sector & MNC Investment


2002 2007

Number of MNC R&D ~50 300Domes research

GE: John F. Welsh Institute, Bangalore

ARM: India and US Research on par

Microsoft: Third largest R&D lab in India

300 more R&D centers planned

Employ 80000 scientists

Planned investment USD4.7 bn

2002 2005

$815 mn $4176 mn Private R&D Investment

$4075 mn $8658 mn Total R&D Spending


Which sector will drive innovation in the future?


2004-05THE IT- INNOVATION PARTNERSHIP

USD 12bn

Software exports (Up from USD 9.2bn in 03-04)

30.40% Growth 35% IT Exports as a % of total Exports

~1-2% R&D as a % of Sales(Nascomm)

IT revolution geared the India Inc….


The three big players of tomorrow…


Pharmaceuticals

2004 PHARMA $4.6bn Revenues

50% Expected growth in 5 years

$142mn Investment in R&D by 10 largest drug firms

~6% R&D as a % of Sales(DEMOS RESEARCH REPORT)

World class educational institutes (TIFR/IISC) Low cost of new drug development (1/10th of Europe)

Cost effective contract research

Pharma companies setting up R&D centers

TRIPS compliance Average Salary of Indian

6158

2119

8

0

10

20

30

40

50

60

70

India Italy Spain China Israel

Highest Number of US FDA Approved Plants Outside the US are in India


Biotechnology

2004 BIOTECH$1.1bn Revenues

37% Growth $5bn Growth target by 2010

Rs.6.22bn

Biotech Research Plan outlay (1997-2002)

Rs.14.5bn

Biotech Research Plan Outlay (2002-2007)Patent protection introduced for microorganisms

Main contributors to biotech industry –pharmaceuticals, immunobiologicals and industrial products

(DEMOS RESEARCH REPORT)


Nanotechnology

2004 NANOTECHNOLOGY$ 200

mn Planned investment by Government in 5 years

$s 24 mn

Nano Science and TechnologyInitiative spends

Focus: Nanotube based solar power cells, diagnostic kits and drug delivery

(DEMOS RESEARCH REPORT 2007)


A closer look at Healthcare and life-sciences


2007 Healthcare Market $37.5bn Size of healthcare market

$75bn Expected growth in 5 years15% CAGR

10 times Expected growth of CAGR till 202213% Growth in 2006

Technopak Health Outlook 2007-08

Growth projections for Indian Healthcare Industry in INR

12000

3000

1500

6000

0

2000

4000

6000

8000

10000

12000

14000

2007 2012 2017 2022


DEMOGRAPHIC GROWTH DRIVERS OF HEALTHCARE IN INDIA

18.7mn Size of the middle class (Households)32.7mn Expected growth by 2010

($4938< Middle class<$24691)

173mn Expected growth to 2026

40 Expected growth by 2026

Significant increase in Epidemiological/lifestyle Transitions

83mn People over 60 years (2006)

~29% Urbanization (2006)


Population Growth across age groups

356 346 340 336

671 747 810 859 899

8398

118173

327

143

0

200

400

600

800

1000

1200

1400

1600

2006 2011 2016 2021 2026

0-14 15-59 60+

NON COMMUNICABLE YEAR MN MN IN YR

2015

Cancers 2004 0.87 0.99

Diabetes 2005 31 46

Mental Health 2005 65 80

Cardiovascular 2000 29 64

CODP and Asthma 2001 40.5 59.3

National Commission on Macroeconomics and health


OTHER GROWTH DRIVERS OF HEALTHCARE IN INDIA

Emergence of empowered customer

Increased accessibility to health insurance

Medical Value travel


Projected Growth of Health Insurance Premium Payouts (CAGR 35%)

35

160

700

0

200

400

600

800

2007 2012 2017

Insu

ranc

e P

rem

iun

in R

s 00

0mn

Projected Growth of Indian Medical Value Travel Industry (CAGR 20%)

2050

123

308

0

50

100

150

200

250

300

350

2007 2012 2017 2022

INR

'000

mn


Global Market

India Market

2010 Opportunity

$8bn(Kalorama)

$250-300mn

(Industry Sources)

Discovery research Outsourcing

$14.4bn (Centerwatch

2007)

$1.5bn Mckinsey

Clinical Research Outsourcing

$25.7bn –2010

(Frost and Sullivan)

10% of Global Market

Custom Manufacturing

The key opportunity areas

Company Overview &

Its Technology Solutions

40


Leading provider of research-driven solutions solely-focused on pharmaceutical industry– Founded in 1994 and headquartered in Pune, India with global presence

– Manufactures packaging materials to significantly enhance function, physical efficiency and safety of medicines …

• Leading producer in Asia (~65% share of Indian barrier blister packaging market)

– … and provides world-class packaging research and clinical trial services

Operates best in class, manufacturing and research facilities in India, Singapore, UK and USA– India: 1st pharma pkg. materials mfg. facility of its kind in Asia, and 8th in the world, 1st pharma pkg. Res. facility in

the world. 1st clinical trials services facility in the country. 1st Academy for Clinical Research in collaboration with ACRP of USA. Mission of Bilcare & ACRP – Build competencies for best practices in Clinical Research across Asia

– Singapore: 1st pharma pkg. materials mfg. having the worlds largest state-of-the-art polymer coating line. Awarded "Pioneer Status" by Singapore government

– USA: FDA and DEA approved clinical services facility along with a technologically advanced material slitting facility

– UK: MHRA approved clinical trial services facility along with materials warehousing & distribution

Pioneering and patented packaging & Healthcare management system technologies– Optimum packaging solutions devised in just 4 weeks using patented process

– Several novel patented products for successful branding strategies

– Significant cost savings benefits for pharmaceutical companies

– Leading packaging solutions through R&D

Company Overview



Global Clinical Services

42India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008


Bilcare’s clinical trial services provides end-to-end clinical supplies management services including:

– Protocol design

– Regulatory compliance & patient safety

– Batch manufacturing

– Packaging design

– Storage and global distribution

– IVRS

– Returns management

Bilcare provides comprehensive clinical supplies services to its global client base– Operational and distribution facilities in India, UK, United States and Singapore

Bilcare also provides distinctive services to its customers in the areas of product formulation and development

– Opportunity to more rapidly and effectively conduct clinical trials, thereby potentially enhancing the speed to market of NCE’s

Formulation Development– Develop formulations with a focus for clinical studies including pre-formulation

– All dosage forms and their line extensions

– Over encapsulation & blinding of drugs

– Develop placebos & comparator supplies

– Addressing needs of reformulation for phase I – IV studies

Stability Program

Analytical Development– Cleaning method validations

– Dissolution testing profile

– Analytical method development & validation with a focus on drugs undergoing clinical studies

– Analysis of drugs under stability program

– Analytical support for pre-formulation & formulation development

– Shipping studies evaluation



Research Services



Pharma Packaging Research

Packaging Development & Design

Packaging Audit

Brandpak building solutions



Material Services



Comprehensive range of innovative packaging materials – films & foils:

– Scientific optimization of drugs

– Maximize shelf-life

– Increased product stability

– Enhanced speed to market

– Protection against counterfeits

Packaging comes in Blister films, Aluminium foils, Cold formed blisters (Alu Alu), and Wrap Systems

The Company produces films and foils for blister packaging of pharmaceutical tablets and capsules, employing four distinct manufacturing processes

– Dispersion Coating Technology – state-of-the-art dispersion coating systems equipped with sophisticated gauging and other control systems and operated using in-house proprietary process technology

– Dry Polymer Lamination Technology – used to produce multi-laminated films with high clarity and optimal physical features

– Aluminium Processing Technology – used to produce varied speciality coatings, including laminations on aluminium, which result in products which retain reduced solvent levels, well below international limits

– Slitting Technology – integrated with packaging systems to provide customers with comprehensive functional safety and product protection

Bilcare has extensive in-house research and design capabilities, used to develop and test innovative packaging solutions

Cyclic-olefin copolymer (COC) also used for core layer in 3-5 layer blister films

PVC is most common resin for core layer

Outer layer made from a variety of resins including polypropylene and PVC



Academy for Clinical Research & Innovations



• Academy for enhancing competencies and capabilities of the clinical research professionals and clinical research sites

• Create continual innovations for addressing key concerns in the space of clinical research

• Develop value based solutions including IT enabled solutions for enhancing the speed of clinical research study programs

• Commitment to Quality & Highest Ethical standards creation

• Collaborate with the leaders of Best Practices to enable true enrichment of professionals

• Unique 1 year post graduate diploma program in clinical research management in partnership with ACRP of USA

• Create & build competency of Clinical Research professionals in collaboration with ACRP, USA across Asia

KnowledgeInnovation Sharing



Addressing the Key Customer Challenges

• The 5 C’s– Counterfeit– Compliance– Convenience– Communication– Cost



Challenges• Counterfeit needs to be recognized as a key challenge as it leads to

– Non-Compliance resulting in frequent change of prescription; drug resistance – secondary care leading to significant increase in healthcare management cost

• Medicine as total cure recognized as Myth

– Imbalance in diet and fitness management are major contributing factors

• Solutions must

– Empower consumer to participate in the global action on anti-counterfeiting– Be Commercially sustainable & yet simple for operability by the consumer– Be capable of addressing multiple concerns



• Avoidable Complications & Hospitalization

• Enhanced burden of healthcare costs on Nations

• Anti-Counterfeit – Who should tackle?

– Producer, Regulator, Patient, Pharmacist or the Doctor? – Government, Healthcare Organizations, Insurance Cos.?

• “Means & process to facilitate Collaborative efforts of all stake holders”

Challenges…



• Clinical Research & Development of new medicines / therapies

– Impact of Non - Compliance

– Real time patient feedback

– Timely professional interventions

• “Means & process to facilitate Robust Clinical Research Management”

Challenges…


India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008 54 53India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008

Pharmacy

ComplianceSupport

Care giver

Anti - counterfeitSupport

PatientDoctor

Insurer

Manufacturer

Hospital

National Health System

Distribution

IntegratedInteractive Companion

Device

HealthcareKnowledge

Management System


BilcareA business model based on innovation

• Symbiotic & Synergistic collaborative Approach

• Innovate over spheres of conventionalism

• “Crunch and Breakthru” process

• Focus on creating innovations with effective end use applicability

– over 60 patent filings worldwide

• Value proposition for Well Being and Health care management



Honorable Dr APJ Abdul Kalam, Dr John LaMattina – President Pfizer Global R&D, Dr. R Chidambaram - Principal Scientific Advisor to Government of India inaugurating Bilcare Center of Excellence and the Revolutionary Technology


India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008 57 56India As An Innovation Hub – Praful Naik, CSO, Bilcare Limited: Telfer India Forum, OTTAWA, 20th February 2008


Thank You

www.bilcare.com

The Changing Geography of Ideas - Telfer School of Management · 2018-02-01 · 34 new patents The peoples car@$2500 ‘Gandhian engineering’ No radio, power-steering, AC, one wiper

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