Interview / Ajay Piramal

'Genomics is the next big thing for India'

Nicholas Piramal India Limited decided to foray into a new area called genomics months before the unfurling of the human genome sequencing on June 26. However, its announcement to tie up with the Centre for Biochemical Technology for the GenoMed programme, and its decision to float a separate company called GeneQuest, have made the drugs and pharmaceuticals industry worldwide sit up and take notice.

The company has also attracted international media attention, including mention in Newsweek and the Financial Times. Chairman and managing director Ajay Piramal, 44, is excited but not euphoric.

"Foreign companies don't think we can do it. I hope our company will prove them wrong," he tells Y Siva Sankar in an exclusive interview.

How did a mainstream drugs and pharmaceuticals company like Nicholas Piramal get into genomics? How did the company's board of directors react when you first proposed the project?

We've been greatly motivated by Dr Mashelkar. We've worked with him in one of the CSIR's laboratories called the CDRI (Central Drug Research Institute) where we had the breakthrough with our anti-malarial drug.

We've always been influenced by some of India's greatest minds. He mooted this idea of Genomics Valley, a cluster of companies working in genomics in India. This was his dream. He said it almost eight months ago. We told him that we will endeavour to give his dream dimensions of reality.

I was thinking about this area for some time. When Dr Mashelkar spoke of a Genomic Valley in January, I said, 'Yes, this looks exciting'.

Overall, the board was excited because for the first time, we found that intellectual capital is really getting valued. The function of the board of directors is also to ensure that value is created.

Today, intellectual capital has more value than bricks and mortar, so to say. At the same time, they were very clear that we should have a business model that generates revenue; they were keen that the project should not appear as a mere scientific discovery or expedition where you spend millions of rupees and the returns are not there.

We have to understand that we are not a large company by international standards. We have to deliver returns to our shareholders.

The fact that Nicholas Piramal is the first Indian company to get into genomics, has attracted media attention. How does it feel?

Personally, I feel very happy and satisfied because as, Dr Mashelkar pointed out, this is really cutting edge research and is comparable to the best in the world.

Normally, Indian companies follow the trend set by companies abroad. There is usually a long lag period. But this is a rare occasion when India is on par with the world.

At the same time, it is a great experience bringing together all the advantages that India has, our rich intellectual capital, great genetic diversity, strengths in information technology.

Did you seek the support of financial institutions for your new venture?

We did not. This is not a major investment though it is an important one. We don't propose to talk to the FIs immediately. We might do that later. Generally, we have had discussions with a lot of people.

The prime minister himself is very keen on biotechnology and pharmaceutical research in this area. In fact, our company went to Rome and Lisbon in June-July, and he asked me to talk on these areas.

The finance minister also is very keen on these areas. I learnt this when I accompanied him to the US. Everyone is keen, no doubt. But we have not discussed funding, etc, with the FIs. It's not necessary at this moment.

There has been resistance in India to companies like Monsanto that are engaged in agri- and bio-research. Do you foresee scope for controversies in genomics too?

Controversies are more to do with issues related to genetically modified food. People are realising that there are not all benefits, there are side-effects too.

In any technology, one has to be very careful to ensure that it is good and has enough safeguards.

What we are doing now is not on a scale where there can be a controversy. We are looking at specific areas where there is demonstrable benefit.

There is a view that genomics is the next big opportunity for India. Is it?

It is, indeed. India is the only country which has a rich genetic diversity and also a big database. Ours is the only country which has both a large population and large families. Many of the large families live together.

Therefore, you can find, let's say, diabetes which is hereditary. You can find a grandfather, a father and a son all living together. You can study how the gene has moved from one generation to the other. No other country offers this convenience.

Roche is doing some experiments, but that's only in Iceland. But then, the population there is limited. So we have that advantage. Second advantage we have is genetic diversity: there are so many types of communities, castes.....Gujaratis, Bengalis, Tamils.

This field requires intellectual capability and our scientists are there to provide that. Now, this field does not require huge amounts of money. It is no longer a really capital-intensive business.

You need the combination of information technology and science which is also available. We are not behind the world. We are on par with it. So I think genomics is indeed a big opportunity for India. The benefits of this are all-pervasive.

There was a time when healthcare was seen as a welfare measure, a social obligation. Like in the West, Corporate India is increasingly seeing it as a potential big business. What are the implications of this change in mindset?

We have to have a combination of both the social and business elements. Such a combination is actually ideal. You have to have a business that is sound financially and does not ignore its social responsibility, especially in a country like India.

Ideally, we would like to balance both of these so that you get a good return for your shareholders and yet you don't totally distance yourself from what is your obligation to the society.

It is really a question of how much to charge and to whom. Sometimes you think, is what you charge what the international market can pay in India? Or, is it what any other user can pay?

One will have to find that balance somewhere as one goes about doing this business in India. There will have to be a sort of... probably differential pricing. There are too many people who are poor and who are suffering, we have to find a way to address this issue.

Genomics and information technology go hand in hand, say the experts. Will you diversify into infotech?

I don't think we will do it for this purpose. That is not our plan. We may network with infotech companies to bring in their expertise as well.

I'm happy at the way our software industry has evinced interest in the field. Their response has been much faster than in other fields. It is still early days -- after all, the gene sequencing news came out on June 26.

Unlike Y2K, it is much more difficult here. Every person could have got affected by Y2K, so the industry had to do it. Here there are few people who have that urgency. It is not such a large, all-encompassing field. Probably, genomics could be more valuable and more sustainable in the long term.

Ministerial and bureaucratic shake-ups have become frequent, of late. Are you happy with the awareness levels of subjects like genomics at governmental level?

I am very happy. I must say, for once, the government is pushing forward research-based, biotechnology-based, genome-based industries. There is a very positive attitude in the government to this area.

As a key member of the FICCI, would you press for concessions for genomics in Budget 2001?

Last year itself, an R&D fund was created for industry. I think they still have to get the mechanics sorted out. There is some encouragement in that. Let's utilise the fund first, then we will think about the next level.

Since you are the pioneer of genomics in India, your performance will be watched closely.

It is an exciting phase. If we show our mettle and create something concrete that can inspire others, we will succeed in repositioning India's intellectual capability as well as companies at large.

There is definitely pressure on us because we are being watched. That is why we don't want to raise the expectation level too high. There will be cynics, there will others who will be watching us with enthusiasm.

We have not spoken to any foreign companies yet. But there will always be some people who will look at us with scepticism because they don't think India can do it. Many of us Indians, unfortunately, don't believe in ourselves. I hope we can prove those people wrong.

What is there in this project for the shareholders?

We hope to build long-term value for them. This is one of our goals of building long-term shareholder value.

ALSO SEE:

An earlier interview with Ajay Piramal on rediff.com

EXTERNAL LINKS:

The Centre for Biochemical Technology

The Council of Scientific and Industrial Research

Nicholas Piramal India Limited

Money

Interviews

Tell us what you think of this interview