The Indian biotechnology sector, especially the area of life sciences, is increasingly attracting the interest of institutional investors and investment bankers.

3i, APIDC, Axis Holdings, Chrys Capital, ICICI Venture, Kotak Mahindra, Nadathur Holdings, New Enterprise Associates, UTI Venture Funds, Yes Bank, are among the key investors geared to harvest this upcoming sector.

With total investments amounting to approximately US$ 120mn as of March 2006, industry sources predict an additional investment in the range of US$ 600-700 mn in the next two years, from leading venture capital companies, private equity funds, investment bankers and various government schemes.

Despite its strong knowledge base, India was lagging behind in biotechnology entrepreneurship, due to a dearth of investment. The industry had to therefore take several initiatives to create awareness about the promising investment opportunities in the sector. For instance, Association of Biotechnology Led Enterprise (ABLE) has been conducting interactive conferences and seminars in association with investment companies to spread awareness regarding the new opportunities for growth.

Nitin Deshmukh, head, private equity, Kotak Mahindra Bank, and director of ABLE, points out, “The life sciences companies are reinventing their business models and are moving to innovation-led research products, realising that in order to attract VC funding, companies have to focus on innovative technologies and drug discovery.”