Every three months, after her Bengaluru-based pharmaceutical
company would deliver its earnings report, Mazumdar-Shaw says the trolls would emerge. They would tell the Biocon
managing director and co-founder that she was the country’s worst business leader, that she should give up her stake in the firm, and that she was the reason women shouldn’t run companies.
Her response was to break one of the unwritten rules of Twitter — don’t feed the trolls — by trying to explain to the hecklers that her company specialised in complex biological medicines rather than chemical ones. So, while other Indian drugmakers were seeing their share prices surge as they sold cheap copies of chemical medicines, she told the trolls she was making longer-term investments that would provide a bigger payout if they were only patient.
This year, the trolling suddenly stopped, she says. Mazumdar-Shaw reckons it has less to do with her outreach than the almost 80 per cent rally in her stock. It was the best return among shares of generic drugmakers worldwide after one of Biocon's copies of a top-selling biologic drug
had its first breakthrough in a developed market.
“Now people get the story, they understand what I was trying to do. And suddenly they find that we're the leading player in biologics and biopharmaceuticals and they feel that maybe everyone else has missed the boat," she said in an interview at her company's headquarters.
But, the rest of India’s pharmaceutical
industry remains sceptical. While the country's mastery over low-cost copies of simple chemical medicines has won it a dominant share of the global market for generics, the Indian industry at large has been slow to follow Biocon's investments in biological therapies.
Biologic drugs are manufactured from substances in living cells, making them uniquely challenging to reproduce. Cheaper versions of these drugs, called biosimilars, are becoming a more important part of the world's medicine cabinets.
Where investments have been made in India they've followed a more cautious model being pioneered by another firm, Dr. Reddy's Laboratories Ltd., which focuses on building biosimilar businesses in developing countries where it's faster and less expensive to get them approved. Their hope is that the cost of entering developed markets will eventually fall.
"There's a significant overstatement, in my view, of this fortune at the end of the tunnel," in developed markets, Cartikeya Reddy, the head of Dr. Reddy's biologics business said in an interview at his company's Hyderabad headquarters. There's no guarantee approvals in one developed country mean the same in another, or that it will result in enough market share to make regulatory costs worthwhile, he said.
At stake between the two Indian companies' contrasting strategies is the question of whether the country can retain its vital place in the global pharmaceutical
supply chain, and the billions in pharmaceutical
exports that come with it.
Where the cost of developing a generic version of a chemical drug
rarely exceeds $5 million or takes longer than a year, biosimilars can cost between $40 million and $50 million and can take as much as four years, according to IIFL Holdings. That cost can go as high as $100 million when entering developed markets.
and other smaller biologic drug
companies have gotten around this by partnering with larger firms to bring their biosimilars to major markets.
In March, Biocon
announced the first piece of evidence that its own gamble might actually pay off when its biosimilar insulin glargine, a diabetes treatment, was approved for sale
If Biocon's product could meet the exacting standards of Japanese regulators, investors reasoned, its products could also get past European and US authorities. The stock took off.
"One year back I had a sell rating on this company," said Abhishek Sharma, an analyst covering Biocon
at IIFL in Mumbai, who now recommends buying the stock. "The consensus view seems to have moved more towards believing that a commercial launch in the US and Europe is quite possible."
Then in November, Biocon
and its US marketing partner Mylan NV submitted an application to US regulators to make a competing version of Roche Holding AG's blockbuster breast cancer drug
Herceptin. Biocon's stock rose 1.7 per cent to ~932.25 as of 9:43 am on Thursday in Mumbai. As of Wednesday's close, the stock had a total return of about 78.9 per cent for the year.
The wave of patent expiries on biologic medicines coming between now and 2020 could be worth about $80 billion to companies that get them to market, according to consultancy Frost & Sullivan.
Dr. Reddy's, India's second largest drugmaker, has been in the biosimilar business since 2007, but its focus on emerging markets has allowed it to build a self-sustaining biosimilars business, with revenues matching costs, according to Reddy, who is not related to his company's founding family.
Longer term, some of Dr. Reddy's biosimilars will enter developed markets after 2020 thanks to a partnership with Germany's Merck KGaA. But the company's ultimate goal is to bring its biosimilars to the US under its own name, which requires regulatory costs to come down, he said. To find more affordable ways of entering the US, the company is investing in novel methods to demonstrate to regulators that its biosimilars are the same as the original drug, according to Reddy.
For her part, Biocon's Mazumdar-Shaw agrees lower entry costs could be the opening Indian companies need. In the meantime, though, she's content to carry the torch for India in the biosimilar race. And as for those Twitter trolls, she says there are no hard feelings.
"I was very sure of what we were doing," she said. "We're in a very sweet spot now."