Key Takeaways
- • Biocon Executive Chairperson Kiran Mazumdar-Shaw said India has made progress in early-stage biotech funding but lacks follow-on venture capital and clear investor exits, per remarks at the Bloomberg New Economy Forum.
- • Mazumdar-Shaw said venture capital investors need exit strategies on shorter timelines than currently available in the sector, which she linked directly to the absence of follow-on VC.
- • The government has signaled a shift from generic drugs to innovative medicines, citing the RDI Scheme, BioShakti and the PRIP scheme, and has committed early-stage, risk and seed capital.
- • Long development cycles spanning research, clinical trials, regulatory approval and commercialisation make biotech harder for investors seeking returns within defined horizons.
Summary
Biocon Executive Chairperson Kiran Mazumdar-Shaw said India has made progress in providing early-stage funding for biotechnology innovation, but that follow-on venture capital and clearer exit opportunities for investors remain a critical gap in building a globally competitive biotech ecosystem. She made the remarks at the Bloomberg New Economy Forum.
Mazumdar-Shaw said the government has signaled its ambition to move India's pharmaceutical industry beyond generic drugs toward innovative medicines. She pointed to initiatives including the Research, Development and Innovation (RDI) Scheme, BioShakti and the Promotion of Research and Innovation in Pharma-MedTech Sector (PRIP) scheme. The government has committed to providing early-stage, risk and seed capital, which could help biotech startups begin developing new technologies and products.
The funding challenge, however, extends beyond the initial stages. "What you need now is follow-on capital from venture funds," Mazumdar-Shaw said, adding that venture capital investors need an exit strategy much sooner than the timelines currently available in the sector. "And that's why you're not seeing follow-on venture capital," she said.
The article notes that biotechnology businesses typically require substantial investment in research, clinical development, regulatory approvals and commercialisation before generating meaningful revenue. These long cycles make the sector challenging for investors seeking returns within a defined horizon. While government-backed funding can support early-stage innovation, sustained private investment is needed to carry discoveries through development and toward commercial success. A lack of follow-on funding can leave startups struggling to advance research even after securing initial support.
Viable exit routes, whether through acquisitions, public listings or other mechanisms, are another key factor in attracting venture capital to biotechnology. Mazumdar-Shaw's remarks point to the need to strengthen the transition between public support for early-stage research and private capital for scaling businesses. India's ability to close these gaps will be important in turning its research capabilities into successful businesses and accelerating its shift from generic drug manufacturing toward innovative medicines.
Mazumdar-Shaw said the government has signaled its ambition to move India's pharmaceutical industry beyond generic drugs toward innovative medicines. She pointed to initiatives including the Research, Development and Innovation (RDI) Scheme, BioShakti and the Promotion of Research and Innovation in Pharma-MedTech Sector (PRIP) scheme. The government has committed to providing early-stage, risk and seed capital, which could help biotech startups begin developing new technologies and products.
The funding challenge, however, extends beyond the initial stages. "What you need now is follow-on capital from venture funds," Mazumdar-Shaw said, adding that venture capital investors need an exit strategy much sooner than the timelines currently available in the sector. "And that's why you're not seeing follow-on venture capital," she said.
The article notes that biotechnology businesses typically require substantial investment in research, clinical development, regulatory approvals and commercialisation before generating meaningful revenue. These long cycles make the sector challenging for investors seeking returns within a defined horizon. While government-backed funding can support early-stage innovation, sustained private investment is needed to carry discoveries through development and toward commercial success. A lack of follow-on funding can leave startups struggling to advance research even after securing initial support.
Viable exit routes, whether through acquisitions, public listings or other mechanisms, are another key factor in attracting venture capital to biotechnology. Mazumdar-Shaw's remarks point to the need to strengthen the transition between public support for early-stage research and private capital for scaling businesses. India's ability to close these gaps will be important in turning its research capabilities into successful businesses and accelerating its shift from generic drug manufacturing toward innovative medicines.
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