Pharmaceutical multinationals are reinforcing their presence in Asia, according to Jones Lang LaSalle's latest Global Life Sciences Cluster Report. Widening patient pools and increasing consumer demand in emerging markets is driving the growth of sales offices, manufacturing operations as well as research and development (R&D) facilities around Asia.
"Beyond the cost of developing new drugs and treatments, facility and real estate costs are among the highest expenses for life sciences companies and such firms are optimising their real estate and location strategies to capture market opportunity in Asia," said David Wilton, Asia Pacific Regional Director for Industrial and Logistics at Jones Lang LaSalle. "It is also apparent that the industry is becoming more strategic with regards to site selection, choosing locations with rich industry resources, capital and a higher propensity for discovery and innovation.”
"India is actively working to attract more funding into the biotechnology sector," says Nirav Kothary, Head - Industrial Services, Jones Lang LaSalle India. "The Indian Government is in discussion with export finance institution, Exim Bank, to set up an INR 2,000.0 crore ($365.6 million) venture capital fund to invest in pharmaceutical R&D."
"There are indications that the country will again welcome outside investments in the domestic pharmaceutical sector, with the Indian finance ministry approving roughly INR 180.0 crore ($333.0 million) in investments by foreign companies," states Nirav Kothary. "This came on the heels of a Government decision to permit foreign investors to own up to 49%t of established Indian firms. Significant foreign deals include Abbott Laboratories buying Mumbai-based Piramal Healthcare's Indian business for INR 20,348.4 crore ($3.7 billion) in 2010 and Daiichi Sankyo gaining controlling interest of giant generics manufacturer Ranbaxy Laboratories for INR 22,974.0 ($4.2 billion) in 2008."
The current rules allow foreign investors to start a company in India once they have obtained approval to get a share of a domestic drug company on conditions that they won't stop making the cheap drugs they currently produce, and that they will keep investing in R&D with Indian partners for five years.
