(Jon Han) 

Worldview Roundtable: The Brics

What drives biotechnology in the BRIC nations? Numbers and statistics tell some of the story, but qualitative characteristics also play a part. In addition, only experts with biotechnology experience in these countries really know what it’s like to work on the ground in these rapidly emerging areas. So Scientific American Worldview polled a panel of experts on biotech in the BRICs, and an edited selection of their replies is presented here as a virtual round table. (For an expanded version of this conversation visit us at: http://www.saworldview.com.)
—The Editors

PARTICIPANTS: George Baeder (vice president, Monitor Group Asia, Shanghai, China); Carlos Medicis Morel (director, Center for Technological Development in Health, Oswaldo Cruz Foundation, Rio de Janeiro, Brazil); P. M. Murali (managing director Evolva Biotech, president and CEO, Evolva Inc, U.S., and a member of the executive council of the Association of Biotechnology Led Enterprises (ABLE India), Bangalore, India); and Raif Vasilov (president, Russian Society of Biotechnologists, Moscow, Russia)

WV: What intrinsic strengths does your country have in biotechnology and life science development?

BAEDER: China is in a very different class than smaller markets like India, Russia or Brazil. Instead of thinking about China as an “emerging market,” look instead at the ways in which it mirrors the key strengths that catapulted the U.S. into a leadership position in the pharma business in the second half of the last century—market scale, scientific talent and focused government commitment. China’s prescription drug market is already the world’s second largest next to the U.S. and is growing at more than 20 percent annually.  This alone creates a compelling incentive for investment. More than 80,000 scientists with medical and biology backgrounds have returned to China over the last 10 years, while the country’s universities produce more graduates and post-grads in life science that any other in the world. Finally, the government has a clearly stated intent to make life science a pillar in China’s future competitiveness.

MOREL: Compared to other developing countries, Brazil has a strong scientific basis as measured by the scientific productivity of its universities and research institutes in international, peer-reviewed journals. Brazil has also developed sophisticated training programs addressing students and researchers at all levels, from young undergraduates all the way to post-doctoral, senior scientists. [Moreover,] support to scientific groups and laboratories can now be obtained from several different sources.

MURALI: India has an absolutely stunning bio-diversity that can be mined. This can find utility in most life sciences sectors. With a diverse/heterogeneous patient population, [for example,] India is a good place to conduct clinical trials, [and it] has the largest number of FDA-approved plants outside the U.S. Indians from the U.S. are also now engaged in cross border partnership fostering quicker growth.

VASILOV: Russia has unique possibilities for biotechnology and life sciences development, including the availability of an enormous volume of renewable resources, including 20 percent of the world’s forestry resources and the world’s largest reserves of freshwater. There is also a growing demand for biotech products in the domestic market, estimated at $3 to 4 billion, and only satisfied by 40 to 45 percent.

WV: What are your country’s greatest challenges in biotechnology?

BAEDER: China’s current regulatory system suffers from a severe lack of resources and self-confidence. Delays in approval for clinical trails have become a major stumbling block to innovation generally, although we have seen some signs of [China’s State Food and Drug Administration’s] willingness to accelerate the process for locally developed drugs. While seeking to harmonize its standards with the U.S. FDA, China will require a radically different approach if it is to remove this stumbling block, including the possibility of multinational collaboration or public-private partnerships with CROs [contract research organizations] and academic research institutes.

MOREL: The greatest challenge [in Brazil] remains the lack of close interaction and collaboration between academia and the industrial sector, which have traditionally remained isolated one from the other. There has been recent progress due to the approval of new laws, including the 2004 Innovation Law, and policies, including the 2008 Productive Development Policy.

MURALI: [India’s] infrastructure development is still in progress, [but] this could be at a brisker pace…. Funding for pure R&D activities is abysmally low, [and there are] no major venture capitalists to foster growth. It is the government funding which is so far helping in early research which is actually the space for angel and venture funds.

VASILOV: Russia’s greatest challenge is to reestablish a modern biotech industry and to develop a knowledge-based bio-economy. In the Soviet Union, biotechnology was a very successful economic branch. In 1980 the share of the Soviet Union on the world biotechnology market amounted to 5 percent, now it has declined to 0.1 to 0.2 percent. In the Soviet Union the science expenditure reached 7 percent of GDP; currently in Russia this indicator declined to 0.3 to 0.5 percent of GDP.

WV: In the next few years, what are your country’s key strategies for driving innovation in biotechnology?

BAEDER: China’s 12th 5-year plan, 2011 through 2015, puts a high priority on both healthcare delivery and life science innovation. It has targeted dramatic increases in R&D spending as well as investment in infrastructure, including a network of clinical trial hospitals modeled on the U.S. system. The critical question is how the government’s support for R&D will be deployed and what incentives are created to foster innovation.  We typically think of high prices for innovative drugs as a prerequisite for innovation. It is quite possible that China will develop a new model focused on directly subsidizing commercially focused R&D across the myriad of startups and CROs as well as leveraging its large patient base to guarantee high volumes. Thus China may make the commercial economics attractive by “re-inventing” the industry’s engine of innovation.

MOREL: Improving [Brazil’s] legal framework and removing bureaucratic obstacles [should] facilitate the collaboration between the academic and industrial sectors. Developing policies and creating incentives [will] stimulate technical and social innovation in industries and [will] facilitate their tapping into the knowledge pool that universities and research institutes can provide. [Also, creating] new mechanisms for the attraction of high-level scientists and skilled technologists from abroad, [will facilitate] their absorption by local industries and universities—“reverse brain drain.”

MURALI: [India will increase its] focus on producing “bio-betters” targeting a market of $70 billion. A focus on building integrated special economic zones [will] make a one-stop shop with all available amenities for R&D and production. Most leading states have biotechnology policy and also the central government has released vision documents in growing this sector.

VASILOV: [Russia’s] key objectives are: shaping and implementing priority target projects in the bioindustry area; developing the regional programs and bioclusters; elaboration of optimal innovations and investment activities in the area of industrial biotechnology; establishing the efficient legal, economic, informational and organizational basis for development of the domestic bioindustry; building the system of industrial biotechnology staff training; and facilitation of international cooperation.