Transcript Japan ppt - Brian Tempest

Shortage of Natural Resources
The Scientific Innovative Power coming from India
Dr. Brian W Tempest
Chief Mentor & Executive Vice Chairman of the Board
Ranbaxy Laboratories Limited, Delhi, India
St. Gallen Symposium, St. Gallen, Switzerland
Friday, 1st June 2007
Asia’s Share of the World GDP (at PPP in %)
Year
1870
1913
1950
1973
2001
China
India
Japan
Rest of Asia
17%
12%
2%
7%
9%
8%
3%
5%
5%
4%
3%
7%
5%
3%
8%
9%
12%
5%
7%
13%
Total Asia
38%
25%
19%
25%
37%
Source – WEF
- was 59% in 1820 with India 16%, China 33%
Davos
Source – FT
The Productivity Advantage
India
1 chemist
70 hours/week
$ 800 monthly
a usa Pharma view
Better education x 1.3
Longer working time x 1.3
Lower cost x 20
USA
1 chemist
50 hours/week
$ 12,000 monthly
Sources: IPHMR Conferences, New Delhi August 2004
The Ageing Advantage

Japan
- by 2050 36% > 65 years from 19% in 2005

China
- one child families, get older before becoming wealthy
- labour costs will rise owing to labour shortage

India
-
India already has the youngest labour force in the world
source of the extra needed global workforce
India will pass China in total population in 2030
By 2013 India will have more young workers 20-24 than China
Working Population, 15-64 years
In millions
The R&D Investment Advantage
Most attractive R&D Investment locations:
Ranked 3rd - China, USA, India, Japan & UK
Source – UNCTAD 2005
Reasons why India:





Qualified Scientists & Engineers
Global India players with Alliances
English speaking
TRIPs compliant – first patent March 2006
IIT, IIM & other scientific institutions
Source – UNCTAD 2005
The Science Natural Resources Advantage

4th largest reservoir of Scientific Manpower (2nd largest English
speaking)

3m graduates pa, 115k MSc Chemistry (3.5k UK), 215k Eng (222k
USA)
Physics the most popular subject

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Lead by a Nuclear Scientist as President – remote sensing
satellite technology, 1/6 countries
PCT application ranked 3rd – Kor, Chi, Ind, Sin, RSA
“US & Europe will not dominate Science, Maths, IT industries”
– Mr. Bill Gates
Science Natural Resources in EU
“This means that when pupils are in a science laboratory their
experience is unsafe, unsatisfactory or uninspiring for 65% of
the time.” Source: Royal Society of Chemistry, Policy Bulletin – Spring 2006
UK “A” Level entries:
2000
2005
Physics :
32,059
Chemistry: 40,856
Maths:
67,036
Computing: 19,099
% change
28,119 -12%
38,851 -5%
52,897 -21%
7,242
-62%
Closed UK University
Chemistry Departments:
Dundee
Surrey
Lancaster
Kings
Exeter
Queen Mary
Source: Daily Mail – 11 August 2006
Only pupils at private schools can take physics, chemistry & biology separately
Source: Times, 9th November 2006
Science Natural Resources in India
Number of Higher Education Institutions
05/06
00/01
90/01
80/01
18,123
11,412
5,932
4,861
Number of Students enrolled in
Higher Education Institutions
+59%
05/06
00/01
90/01
80/01
Source: Indian University Grants Commission
Number of Institutions courses
05/06
99/00
Pharmacy
1478
669
Medicine
229
174
Physiotherapy 205
52
10,500
7,500
4,000
3,000
+40%
Source: Indian University Grants Commission
PhD Degree awarded in Science
+120%
+32%
+294%
Source: Pavan Agarwal (2006) based on data
from professional councils
03/04
5408
00/01
3734
90/01
2950
(USA 03/04 25,000)
+44%
Source: Indian University Grants Committee
The Science Natural Resources Advantage
Engineers/Science graduates p.a – India 0.7m, China 0.5m, EU 0.5m, USA 0.4m, Japan 0.3m
Investment by Microsoft in India

Microsoft Global Development Centre (GDCI)

Microsoft Global Services (MGSI)

Microsoft Global Technical Support Centre
(GTSC)

Microsoft Systems Research (MSRI)

Microsoft India Development Centre (MIDC)
The Pharma Plants Advantage
Active Pharmaceuticals Facility, Mohali
Dosage Forms Facility, Paonta Sahib
Generics – API’s
USA DMF filings by India
1990
1995
2000
2004
2005
Source: Crisil / US FDA / J P Morgan
Source: US FDA, Credit Suisse
1
4
36
187
262
% Share of USA DMF filings
2004
2005
2006
Q1’07
India
27%
37%
44%
48%
China
9%
10%
14%
17%
Source: US FDA / J P Morgan, 2nd May 2007
Generics Rankings
Source: UBS, Businessworld, 30th October 2006
Discovery – Local vendors available in India to
Support Discovery Research
Vendor Availability
Analog preparation
Combinatorial chemistry
Analytical chemistry
Structural chemistry
Assay development
Computer drug design
High throughput Screening
Bio informatics
Genetically modified animals
Basic molecular biology
Source – BCG, ‘Looking Eastwards, September 2006’
*Out of 90 vendors in October 2005
India
41
37
37
26
26
26
11
13
0
13
China
25
7
7
5
2
13
2
7
3
25
A race to prosperity
The Tempest Crystal Ball – India & China
•Post TRIPs new products will dry up in India by 2008. Under this pressure
Indian companies will adopt different business models
•The global generic industry will be dominated by India
•Discovery companies will continue to be attracted to India
•China will be perceived to be stronger in biology/ toxicology
•Alliances between Western Biotech and Indian companies will expand
•It will be India & China - and not India or China.
Potential Challenge – Asian Flu*
*50% of world chickens bred in Asia
Potential Challenge – Infrastructure
“Our greatest potential will be realised only if we can ensure that our
Infrastructure does not become a severe and critical handicap”
Source – Manmohan Singh
Potential Challenge – Climate Change
CO2 emission - % of World total in 1990-2000
USA
EU 25
China
Russia
Japan
India
– source: WRI, EIA
23%
17%
14%
7%
5%
4%
Summary
The Scientific Innovative Power coming from India
Asia economic strength is returning to levels seen in the past
Many advantages for India – Demographics, Education
India is a global strategic asset for developed markets
Some “Challenges” – infrastructure, climate change
The current feeling in Indian Boardrooms is that a turning point has been reached, a
tipping point has been passed and India’s time has arrived
India is a rich location for future alliances
MNCs will dip in& out of India & China, using their individual strengths
“China & India represent the future of Asia and quite possibly the future for the global
economy” – Steve Roach, Morgan Stanley
Thank You