Creating Affordable Vaccines for India

When Varaprasad Reddy founded Shantha Biotechnics Limited in 1993, he had a clear goal. "My vision was to make cost effective and affordable vaccines and therapeutics that are within the reach of the common man," he says. Little did he realize how much of an issue money would be, as he struggled to get funding for his new company in Hyderabad, India.

Krish Venkat, PhD

"The initial years were tough," says Varaprasad. "Banks and financial institutions viewed the project skeptically and refused to fund it." Investors saw three main obstacles. First, in their view, the biotech sector in India was too immature. Second, though 45 million Indians are affected by hepatitis B, the lack of awareness of the disease and the limited use of vaccines did not offer great market potential. Third, they didn't believe an electronics engineer could successfully run a biopharmaceutical company.

So how did an electronics engineer end up founding a biotech?

PROVING THE SKEPTICS WRONG

It all started when Varaprasad attended an international seminar in Geneva in 1992, where he was a casual visitor along with a scientist cousin. There, he heard Western speakers say that India lagged behind other counties in following universal immunization programs. Right then, Varaprasad decided to do something about it.

When he approached a Western company for technology, however, Varaprasad heard disparaging remarks about India's inability to pay the technology fee and the inability of Indian scientists to absorb the technology. Knowing how much home-grown talent the country has, he was determined to prove them wrong, and make India more self-sufficient in the process. So the soft-spoken Varaprasad went off to look for funding.

Persistence was his primary tool. At the time, the venture capital system was not well developed in India. Undeterred, Varaprasad pitched his plan to every possible source of funding he could find. The company's big break finally came in 1994, when Khalil Ahmed, the healthcare investment representative for H.E. Yusuf Alawi Abdullah, the foreign minister of the Sultanate of Oman, met with Varaprasad to explore opportunities to invest in his company. Within a few months, Abdullah and his investment partners provided the funds for vaccine research. Abdullah also arranged for long-term loans from Oman International bank at low interest rates.

Three years later, in 1997, Shanvac-B, India's first r-DNA hepatitis-B vaccine was released to the Indian market.

"No looking back since," proclaims Varaprasad. His actions support his words. Shantha now has seven vaccines on the market and nine more in various stages of development (Tables 1 and 2).

Table 1. Shantha Biotechnics product portfolio: products on the market

Varaprasad is proud that Shantha Biotechnics is the first company in India to develop and market important vaccines using in-house expertise and recombinant technologies. "I believe strongly in Indian talent and ability," he says.

Table 2. Key products in development at Shantha

He is also very proud of the fact that his company's products are affordable for Indians. As biogenerics, they sell on the Indian market at prices much lower than similar imported products. Shanvac-B, for example, costs about one-tenth of the price of the imported vaccine for hepatitis B.

FOCUSED ON QUALITY, NOT JUST COST

But Vara-prasad is a man committed to quality as well as low cost. Shantha has passed several quality audits to become pre-qualified by the World Health Organization to supply several vaccines to UN agencies, and is already supplying Shanvac-B to UNICEF. Shantha also is the first biotech company to receive a National Technology Award from the Prime Minister of India.

Continuous improvement is also a top priority. "The biggest challenge for us is to keep up with the various regulatory agencies' requirements and to be ready to meet the demands of the changing landscape of vaccine development," says Varaprasad. The company is addressing this, he says, by continuing to build on the local talent.

INTERNATIONAL TIES

While Shantha continues to develop the expertise of Indian scientists, the company is increasing its international ties. In November 2006, the Merieux Alliance group, a 120-year old healthcare company based in France, acquired a 60% share of Shantha. For Shantha, this link to Merieux is beneficial, because it opens doors to Western markets. "Shantha Biotechnics has the capacity, capabilities, expertise, and GMP quality systems in place to partner with major European and US pharmaceutical companies for the development and manufacturing of vaccines," says Varaprasad. The alliance also benefits Merieux, as well, by allowing it to invest in the growing vaccines market.

FUTURE PLANS

For the future, though, Varaprasad wants to take the development of home grown talent into the next arena: innovator drugs. Given what he has achieved so far, there seems to be no reason to doubt that he can accomplish that, too.

Krish Venkat, PhD, is a director of quality control at Wyeth Biotech, Pearl River, NY, 845.602.1080, venkatk@wyeth.com He is also a member of BioPharm International's editorial advisory board.