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Naco’s apathy riles biotech entrepreneur

Naco’s apathy riles biotech entrepreneur
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First Published: Fri, Feb 12 2010. 12 17 AM IST

Making a difference: ReaMetrix founder Bala Manian in Bangalore. Hemant Mishra / Mint
Making a difference: ReaMetrix founder Bala Manian in Bangalore. Hemant Mishra / Mint
Updated: Fri, Feb 12 2010. 12 17 AM IST
Bangalore: Biotechnology entrepreneur Bala Manian is upset at losing an order from the National AIDS Control Organization (Naco) because of what he calls “reverse racism” of sorts, apathy and non-transparent conduct. Manian’s outburst is uncharacteristic for a biotech executive—the business involves long lead times and more than a fair share of heartburn.
Making a difference: ReaMetrix founder Bala Manian in Bangalore. Hemant Mishra / Mint
Manian, who runs ReaMetrix India Pvt. Ltd, is smarting from an unexplained quashing by Naco of a Rs2.6 crore tender—“International competitive bidding for supply of CD-4 tests and reagent kits and evacuated blood collection tubes/needles and holder”—which closed on 22 October and where ReaMetrix was the only bidder along with Becton Dickinson India Pvt. Ltd (BD). ReaMetrix’s bid was lower by Rs1.7 crore, but instead of being awarded the contract for its cost-effective and user-friendly reagents to be used in HIV/AIDS diagnostics, it has been informally told by Naco about the cancellation, with no reasons cited.
Naco invited the bid through UNOPS, an international, self-financed provider of implementation services to non-governmental organizations, governments and other agencies. The UNOPS technical committee evaluated ReaMetrix’ proposal and the latter says it answered all queries. However, on inquiring about the fate of the tender, ReaMetrix was told by Naco on the phone that the tender had been cancelled and that it will continue with the old supplier BD, which provides both instruments and reagents. ReaMetrix asked the UNOPS technical committee why the bid was cancelled, but didn’t receive any response.
Naco did not respond to phone calls and email seeking an explanation for cancelling the bid. BD also didn’t respond to calls and email.
ReaMetrix reagents, based on “flow-cytometry” technology and validated by the National AIDS Research Institute in Pune, are dry format and pre-formulated, which make it free from cold chain and human error, respectively, unqualified necessities in Indian conditions.
Manian and his team argue that Naco could have served more patients using their reagents at about one-fourth of the cost of those from multinationals.
Separately, BD Biosciences and ReaMetrix signed a deal on 10 January to use the latter’s US Food and Drug Administration (FDA)-approved drying down technology for global delivery of affordable testing products for HIV/AIDS.
“I am not angry, but sad that the primary reason why I started on this journey is not bearing fruit. It would have been fine if we had failed due to technical reasons and I would have gladly accepted it—failure is inherent in any new exploration,” says Manian, whose US FDA-approved manufacturing facility in Bangalore also supplies reagents to places such as the National Institutes of Health and Harvard University in the US. “But to throw in the towel due to unsavoury practices and conduct that is not transparent, is something I was not prepared for.”
As chairperson and mission leader of the Confederation of Indian Industry’s national task force on biotechnology, Kiran Mazumdar-Shaw is aware of the issues facing ReaMetrix, and says the answer is to lobby the government to make changes.
“I feel the only way is to escalate this to the ministerial levels, which I will do,” said Mazumdar-Shaw, who’s chairman and managing director of Biocon Ltd.
Entrepreneurs say this isn’t an isolated case; dealing with the public health agencies in India is often a dialogue of the deaf where small companies find it difficult to navigate the “labyrinth of relationships between existing suppliers (mostly multinationals) and government agencies”, according to B.V. Ravi Kumar, founder and managing director of Xcyton Diagnostics Ltd.
“I don’t even want to touch the government (agencies), I’d rather give my technologies to a non-government organization,” says Ravi Kumar, whose company makes Hepatitis C and HIV kits among other molecular diagnostics.
After four years in which Ravi Kumar tried selling his diagnostics to Naco, which pitted it against “cheap products from some vague Chinese company”, he gave away marketing rights to GlaxoSmithKline Pharmaceuticals Ltd in 2002, which later sold that division to US-based Thermo Fisher Scientific Inc. Following a World Bank study recently that found flaws in Naco’s diagnostics procurement policy, the latter has been sending “feelers to the manufacturers like him”, but Kumar isn’t interested any more.
For Manian, an optical engineer by training who at 64 shuttles between Bangalore and California every six weeks, public health is too big a cause to give up. A seven-time entrepreneur who founded his first company Digital Optics Corp. in 1979 in California and even got his 15 minutes of fame in an Academy Award for contributions to digital cinematography, Manian set up ReaMetrix in 2005 with a purpose to locally invent, develop and deploy sophisticated diagnostics.
Manian has been battling agencies such as Naco on the one hand, and the private sector on the other, where some of his products are constantly benchmarked against international regulators even after being approved by the Indian regulator.
“If it is not India, I will make my mark somewhere else in the world,” Manian says. “I believe in this too much and I have paid too big a price to walk away from the commitment to make a difference through innovation in public health.”
For his next product, a new in-vitro diagnostic platform, a lab-in-a-box that’s designed to run 80% of any high-end pathology lab and can literally take life-saving tests to people in remote locations, Manian is in advanced talks with a US-based large diagnostic company for a global partnership. With $12 million (around Rs55 crore today) in funding from Mobius Venture Capital, Sequoia Capital and India’s Barings Private Equity, Manian says he has fiduciary responsibility to his investors and he will ensure that he delivers on that “one way or the other”.
But for the country’s biotech industry, Manian says Indian leaders “should walk the talk” to make sure there is a level playing field for those who believe in the cause and want to play by the rules of the game. “I am really sad that I have not been able to break through the stranglehold big companies have on governmental decisions,” he says.
seema.s@livemint.com
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First Published: Fri, Feb 12 2010. 12 17 AM IST