Indian biotech companies are increasingly looking to make major investments in Malaysia, lured by the south-east Asian country’s tax sops, easy market access and better infrastructure.

A number of companies, including industry majors such as Biocon, Avesthagen, have recently indicated plans to manufacture in Malaysia through their own units or tie ups. The move is likely
to have great implications for India’s biotech policy.

Malaysia is positioning itself as a cost-competitive country and a regional hub for global biotech companies as it expects to benefit from the knowledge transfer and contribution to GDP. It is drawing Indian companies with a 10-year tax holiday, duty exemptions, customised incentives for large investments, access to ASEAN markets through free trade agreements and no restrictions on equity.

India’s own biotech efforts towards setting up R&D centres, funding entrepreneurship and creating public-private partnerships to promote innovations are being widely accepted by industry players. Yet, many of these moves have been more recent in nature and India does not present an attractive investor climate as Malaysia with its financial incentives and favourable drug policies, industry players say.

Stempeutics Research, which has tied up with Cipla to market its products, had invested Rs 25 crore in Malaysia in 2008, citing the ease in getting approvals.

“The Malaysian government’s regulations for stem-cell products are more flexible and the guidelines are only evolving,” BN Manohar, president of Stempeutics said. Regulatory approval for stem-cell research is seven months in Malaysia versus 18 months in India.

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