1. How has Biocons positioning and strategy evolved over the years?

What role does BIOMAb play in Biocons overall strategy? How big is the current and future market opportunity for BIOMAb? Ans. y Biocon India incorporated in November 1978 as a joint venture between BioconBiochemicals of Ireland and Dr. KiranMazumdar Shaw. y In 1979 - became the first company to manufacture and export enzymes for food processing industry to Europe and USA. y In1994 ,Syngene International, a subsidiary custom research company was established by them. y 1978 97 , they were mainly known as an enzyme manufacturing company and they developed expertize in various fermentation products. y During this course of time they faced mainly two prominent challenges, o First was the technological challenge which was easy since shifting from fermenting enzyme to proteins was not that hard. o The other challenge was to develop the market, because unlike enzymes pharmaceuticals was a much regulated market. y In 1996-97 , they entered into the biopharmaceuticals sector by producing statins as it was a large and growing market. y In 2001 , they got freed from Unilevers resistance and became the 1st Indian company to be approved by the U.S. FDA. , to manufacture Lovastatin, Simvastatin and Pravastatin , gaining a 15%-20% share of the statin market in U.S. and Europe. y During early 2000, within 2-3 years, Statins incurred significant profits and then prices started coming down. This demanded Biocon to go from production of small molecules to large molecules , which led it to the Insulin market. y Biocon formed Clinigene in 2000, to pursue clinical trials if drugs in India. y Aimed initially at the domestic market , the drug was priced 20%-30% less than NoVo. The 150 person sales force in 2001, grew to nearly 250 in the span of two years. y By 2004, they gained more than 10% share of the Indian Insulin Market and were generating 25%-30% of new Statin prescriptions. y After the success of insulin and statins, also the maturing Indian drug market led to an enormous price pressure on generic products, so they planned for the long haul by entering in to the proprietary drug market and were rated as hugely successfully IPO in march, 2004. The company has now come up with a joint venture with CIMAB, Cuba, to develop and market a new cancer treating drug in India, BIOMAb. The drug was designed to treat head and neck cancer which accounted for 21% of all cases, the largest in all categories of cancer. BIOMAb, allowed them to getting into the new market of proprietary drugs. This gave them the chance to learn about the mammalian cell technology, which was considered as the future of biotech industry. In addition , it gave them a chance to develop a new market and build new research and explore new marketing capabilities.

The opportunity of the current market of BIOMAb is substantially high , as Biocon initially planned to target the head and neck cancer because of its high incidence in India (21%). The govt. sponsored public sector accounted for 20% of overall health care expenditure in India and the rest 80% of services were provided by the private sector. Private sector health care was considered more efficient and accessible than public sector. According to the seniormanager of business strategy, more than 95% on BIOMAb patients would be self-paying so there would be a less number of patients who might possibly could potentially afford the drug, but this number was expected to rise considering the annual 9% growth of Indian economy. Potential market size could also be improved by educating end costumers, targeting govt. and insurance companies and charging a lower price for BIOMAb. Also, Indias annual population growth rate of 1.4% could also increase the market potential in future. They also expected the doctors to be more willing to use BIOMAb in conjuction with radio or chemotherapy during advanced stages of the cancer as the stage 2 trials produced a remarkable 100% success rate.