Dsq Biotech Mulls Bio-Infomatics Arm Hive-Off

The Dinesh Dalmia-promoted DSQ Biotech Ltd is planning to hive off its bio-infomatics division into a separate subsidiary.

The company is expected to invest about Rs 40 crore in the division by the end of the current fiscal. A Madhavan, chief operating officer, said the company plans to invest another Rs 20 crore into the division during 2001-02. The company has about 10 US-based clients and expects to generate revenues of Rs 70 crore in the next year.

The division is involved in research of gene annotation, gene sequencing and database generation, he said. "We get a major part of our revenues from contract research," Madhavan said. Through contract research, global majors in the bio-infomatics area outsource certain parts of their research to other companies.

Globally, companies such as Celera Genomics, Double Cryst and Insight were among the major bio-infomatics players. These companies are known to outsource part of their research work to other smaller overseas firms.

According to Madhavan, the industry offers great business opportunities for Indian companies. He said the US market for bio-infomatics and other related-research itself was estimated at $2 billion per annum. However, he felt that it were still early days for Indian companies in the sector.

P Gautam, a scientist working in bio-infomatics with Anna University, said that India had huge potential to attract investments of Rs 5,000 crore in the field and related areas.

Bio-infomatics, he explained dealt with gene annotation, sequencing of genes and analysis of protein structure. Bio-infomatics had enormous applications in pharmaceuticals, he added.

According to experts, the domestic pharmaceutical industry, which was still in its nascent stage, would gain substantial comparative advantage if companies had a strong and independent bio-infomatics research division in addition to their in-house research and development wings.