Could India be the source of your next biotech competitor?
The biotech sector remains a major area of innovation, with companies across the world investing significant resources into research and development. In a report published last year, EY Life Sciences showed that global investment in biotech R&D grew by around $5 billion between 2015 and 2016 to reach a record high. Meanwhile, the sector has provided significant returns to investors over the last decade. The result? The biotech sector remains a major area of interest for companies developing new technologies, drugs, products and services.
But with increased investment, R&D and growth comes increased competition. If you’re active in this area, then you’ll likely be carefully watching the rest of the market to keep tabs on where your next competitor might emerge from and find areas where you can gain a competitive advantage.
One effective tool you can use to help is to analyze patent application data. Patent applications are often the ‘early indicators’ of technology trends, since many innovations are kept secret until a patent is filed. What’s more, granted patents are an indication of how committed an organization is to the innovations they have developed, especially if this involves filing global patents in several countries or regions (an expensive endeavor). By using patent applications as an early readout for innovation (and investment), you can spot threats and opportunities well before any new products or services are brought to the market.
In recent years, emergence of the Asia Pacific (APAC) region as a major source of new technologies and intellectual property (IP) has seen companies and research institutions paying more attention to patents filed by APAC organizations. Much of this attention has been focused on China – with good reason, given that it is growing faster than any country when it comes to new patent applications. However, India is another hotbed of innovation, and given its track record in the pharma industry, it makes sense that Indian companies would also be investing in biotech R&D.
So, what can patent application data tell us about the activity of Indian companies in the biotech sector? And how can you use that information to inform your future business strategy?
Indian organizations are investing in biotech R&D
To explore how Indian companies are investing and innovating in biotech research, we looked at patents applied for and granted since 2007. To help, we used the OECD’s recommended definitions to identify patents related to the biotechnology sector and collected relevant data from the STN® patent databases (focusing on patents submitted in India, the United States or with the European Patent Office). We specifically selected patents registered by Indian organizations by only including those with India indicated as the patent assignee country or with India in the address of the assignee (assignees included academic or research institutions, corporations or individuals). In the case of US data, the patent assignee or applicant also had to be a non-US corporation.
Note: Patent applications are published 18 months after the earliest worldwide filing and patent approvals can lag several years after the initial application. While patent data provides a far earlier indicator than tracking factors like new product or service launches and company PR activities, they still lag somewhat behind when the actual research was completed.
What did we find? Our dataset shows that Indian assignees invested significantly in biotech R&D over the last decade. They filed a total of 4,949 applications and were granted 1,906 patents across 5 general biotech areas:
- A01H – Plant reproduction by tissue culture techniques and processes for modifying genotypes
- A61K (non-pharma) – Medicinal preparations containing peptides, antibodies, antigens or genetic materials
- C07G and C07K – Antibiotics, hormones or vitamins of unknown constitution, peptides
- C12 – Apparatus for enzymology or microbiology, compositions of or processes using microorganisms, enzymes or nucleic acids
- G01N – Physical analysis of biological material; immunoassays; biochemical electrodes
When we took a deeper look at the data, we see that Indian assignees tend to focus on two areas above the others – C12 (58% of applications) and A61K (21% of applications).
If we consider the nature of the A61K and C12 classes, this focus is unsurprising. A61K involves the development of biologics, whereas C12 refers to the creation of tools for processing and producing biologics (among other things). Both are closely related to the production of pharmaceuticals, an area where India is already a world leader. As such, Indian organizations already have access to much of the expertise, infrastructure and experience they need to step into the growing field of biologics.
Indian organizations are submitting and receiving patents in India, Europe and US
Indian assignees submitted many patent applications over the last decade (and received a significant number of approvals). However, where are they submitting these applications? Are they focusing solely on Indian patent applications, or are they also submitting applications to other countries and regions? These are important questions, as they can provide us with insights into the likely quality of the IP being generated in India (and how confident these organizations are that their new technologies will be commercially successful).
Looking at the data, we see that over a third of the applications were filed outside of India (20% in the US and 16% in Europe). Of the patents approved, 51% were submitted in the US, 26% in India and 23% in Europe. This suggests that a significant number of the innovations being patented by Indian assignees were deemed important enough to patent in the US and/or Europe (at considerable expense), a move supported by the relative proportion of patents that were successfully approved by these bodies during the last ten years.
However, it is still important to note that the majority of patents were filed in India, so why is this? It may be that companies do not see enough potential monetary value to pursue expensive global patents for some of this technology, or that the technology changes so rapidly they prefer to simply publish defensively in their home country to restrict further development by their competitors.
How you can use this patent data to help direct your future business strategy
Our data analysis shows that Indian companies, organizations and individuals are actively innovating across several areas of biotech research, especially those related to the development and production of biologics. It is likely that they deem many of these new discoveries to be of high value, as they are going to the expense of patenting many of their discoveries in the US and Europe.
But what does this data mean for you and your organization?
Fundamentally, you are a biotech company, research organization or university, you should see India as a significant source of future competition, as well as a possible area to explore new partnerships and collaboration. This is especially true if your primary focus is biologics. What’s more, if you are responsible for managing your organization’s development, setting its vision or making decisions about its R&D priorities, understanding India’s relative interest across the five areas of biotechnology can help you better manage risk, uncover new opportunities and ensure you are effectively allocating resources to the ‘right projects’.
These macrotrends can also be used to direct future research. For example, knowing that Indian organizations have been granted a significant number of US patents over the last ten years might prompt you to dive deeper into the US data to specifically read and analyze these patent filings. This would allow you to find out specifically what your competitors have been investing in, while also highlighting any gaps that might stimulate ideas for future innovation within your own company. This data can also effectively feed into tools like SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) to help you better direct your future business strategy.
Leveraging patent data in other life science areas to better guide your organization
Analyzing the biotech patent activity of Indian organizations can provide important insights for your business. However, it is just an example of how global patent trends can help ensure that you are monitoring important leading indicators of change in your industry (thereby enabling you to adapt accordingly).
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