US Biosecure Act: Impact on Indian pharma companies

The Biosecure Act has led larger multinational corporations to cautiously explore ways to diversify their supplier base. This has increased the interest from big pharma in Indian companies.
Laurus Labs, for example, has observed the beginning of vendor diversification and an uptick in late-phase project requests.
However, this shift is expected to unfold gradually over time, rather than within a few months or quarters, according to Dr Chava of Laurus Labs who anticipates that companies will start by handing over small projects with collaborations expanding progressively.
Similarly, Piramal Pharma is experiencing more exploratory discussions.
Although many of their customers are evaluating options, resulting in inquiries, visits, audits, and requests for proposals, no significant decision has been made yet as customers continue to assess their choices.
Neuland Labs has also engaged in more conversations, customer visits, and meetings with US firms but has yet to see a substantial impact in terms of active requests for proposals or orders.
While the company is optimistic about the favourable environment in the medium to long term, it is important to note that Neuland is primarily an Active Pharmaceutical Ingredient (API) company, which differs from clinical or biologically focused CDMOs.
Syngene appears to be gaining more traction, likely due to its existing long-term contracts with multinational corporations point out analysts.
Jonathan Hunt of Syngene has observed a ‘material shift’ in big pharma’s sourcing strategies to mitigate risks.
Syngene has indicated that it is participating in pilot projects related to the ‘China switch’ opportunity and has seen a 50% year-over-year (YoY) increase in RFPs in terms of value in the first quarter, its best performance in four years.
While Indian companies are preparing to seize these opportunities by investing in technology and expanding capacity, there are challenges to overcome.
Experts highlight that Indian companies lag behind their global peers in terms of experience, trust, technology, and large-molecule capacity. Indian companies need to enhance their capabilities while competing with US and European firms for the same business.
Big Pharma is expected to move more quickly than emerging biotech companies in exploring India as an alternative, due to their deeper financial resources.
Although the timeline for implementing the Biosecure Act has reduced the urgency for immediate alternatives, the overall trend remains unchanged, signalling a long-term opportunity for Indian contract research organizations (CRO) and contract development and manufacturing organizations (CDMO).
According to Sibaji Biswas, ED & CFO, the Syngene International, US Biosecure Act is a tangible opportunity for Indian companies. He is positive on India CRO and CDMO space in the next four to five years.
Vishal Manchanda, Pharma Analyst, Systematix Group thinks that Divi’s Laboratories, Suven Life Sciences, Aarti Pharmalabs and Syngene could be big beneficiaries of the US Biosecure Act.
Source: Cnbctv18