Remarks for BIO CEO Jim Greenwood
Vibrant Gujarat 2017
Biotechnology: Redefining Life Science
Wednesday, January 11, 2017
Thank you, Secretary, for that kind introduction. Namaste. Good morning. It’s an honor to be with you. I’m grateful for this opportunity to return to India. Before I joined BIO, I served for 12 years in the United States Congress. For much of that time, I was the chairman of the Congressional India Caucus. I felt then that too often the United States looked right past India and focused on China. I believed that was a mistake and worked to ensure my fellow Americans understood the extraordinary opportunities here.
In that role, I had a special opportunity join President Clinton when he visited your country in March of 2000. It was the first time a sitting U.S. President had traveled to India in 22 years.
Traveling with the President is a different kind of experience. Our motorcade sped through streets cleared of traffic and pedestrians. We were given a tour of the Taj Mahal, empty of any other people. Everything was so quiet.
It wasn’t until I returned that I was able to experience the real India – with its teeming populace and vibrant and varied culture. I returned to launch our BIO India Conference in Mumbai in 2009. My wife and I visited the Ajanta caves and celebrated our 25th wedding anniversary on a houseboat in the backwaters of Kerala. While touring tea country, we stayed overnight at the Coconut Lagoon in the same bungalow where Paul McCartney and his wife once stayed.
India has so much to offer. On this trip, I’ve been meeting with leaders of the Indian government but I’ve also made time to enjoy my hobby – photographing birds.
I left Congress to lead BIO, because I believe biotechnology is the most transformative enterprise in human history. When the BIO search committee interviewed me for this position, they asked me if I had a passion for biotechnology. I answered this way: In the 4 billion years since the first cell replicated itself, the process of Darwinian evolution has led to our species: the one that is – we think, at least – the crown of creation. We possess these enormous brains with multiple senses and hands that can manipulate our environment. Using these faculties, we can literally reach into our body … pull out our DNA … put it under a microscope … and based on what we learn … prevent a couple from burying their child. We can also make farmers more productive. And we can make biofuels and biomaterials that are more sustainable. As we say at BIO, we heal, feed and fuel the world.
When I think about biotechnology, I focus not just on the science and the business, but on the true value of what we offer our fellow human beings – and that is time. Lives lengthened by months or years, so we have more time to be with the people we love. At BIO, we’ve been working to convey this message to American policy makers, who have the power to accelerate or impede the pace of our breakthroughs. Take a look at our ad.
I’ve never been asked to speak after a Nobel Prize winner. Today, I was asked to follow two. I’m not foolish enough to try to lecture this room about the science. But I do believe we are on the cusp of revolutionary advances that will enable us to use gene editing, immunotherapies, cell therapies and other techniques to dramatically accelerate our progress toward our vision of a world without disease, hunger or pollution.
In the agricultural biotech space, gene editing allows breeders to make crops and livestock resistant to disease. The technique has produced wild tomatoes and eggplants resistant to diseases that had devastated vast acreages. Gene editing is also improving drought resistance in plants.
India has the scientific resources and research excellence to assume its rightful place beside the United States and China as a global leader in genome editing and biomedical innovation. But what I really want to convey to you today is that this future won’t be possible in India – or anywhere – without a government committed to creating a policy environment where the science can flourish. All of the scientific and entrepreneurial talent in the world cannot overcome stifling public policy.
Fortunately, under the Modi administration, we’ve already seen some movement toward a more competitive landscape for Indian biotech enterprises. I hope that these positive trends continue at an accelerated pace.
American companies produce 57 percent of the world’s new medicines. Our innovators have discovered and commercialized more pharmaceuticals than the rest of the world combined. We miss few opportunities to remind our elected officials that biotech innovation is just as dependent on good policy as it is on good science.
The laws that elected officials write – or don’t write – make the difference in whether investors open their wallets… Whether innovators open plants and create jobs … Or whether they take their R&D and manufacturing to countries where the cost and complexity of doing business may be less.
In the U.S., we’ve worked assiduously to make sure our FDA has sufficient funding to hire the expert scientists they need to review applications in a timely manner. Our companies have a single point of contact at the FDA who provides timely feedback and can answer their questions. When you’re an entrepreneur, your time can be your most precious asset. Bureaucratic delays and government backlogs come at a cost to innovation. We work closely with the FDA to make sure that doesn’t happen.
Here in India, I see two critical policy challenges that, if addressed, could usher in a new wave of biotech innovation and investment. The first is intellectual property protection. The second is access to capital.
On the first point, biomedical innovation cannot be sustained without a government committed to protecting your work product.
Two years ago, BIO changed the “I” in our name. Instead of the Biotechnology Industry Organization, we’re now the Biotechnology Innovation Organization. Not because we don’t value generics and biosimilars. But because we wanted to highlight the fact that without innovation, there is no industry at all.
As CEO of BIO, I helped lead the creation of the U.S. biosimilars industry. In 2009, we began negotiating our health care reform law known as Obamacare. It’s the law that President-elect Trump plans to start repealing later this month. We had a robust internal debate about how biologics should be treated under American law. Some of our member companies didn’t want to sanction any generic competition. But I strongly disagreed with this approach. I told them we have a moral responsibility to create a pathway to get affordable biologics to patients in need.
But I felt equally passionate that this pathway must not stifle biomedical innovation. So I insisted that innovators who create an approved biologic receive a 12-year period of data exclusivity before the FDA can approve a biosimilar. I also insisted that biosimilars be subjected to a minimum standard of clinical trials – given the complexity of these therapies and the use of living entities. No one will invest hundreds of millions of dollars to research new biologics unless government protects the underlying IP.
While the IP environment in India has long been challenging, the Modi Administration has been making strides. The decision not to pursue compulsory licensing – and the Prime Minister’s leadership in setting up an IP task force with the United States Trade Representative– are encouraging steps. Still, there’s much more work to do – to allow patenting of new products and to enforce companies’ IP rights.
Most young life sciences companies have one asset and one asset only: their intellectual property. If their IP is not strenuously protected, early-stage companies cannot attract capital to continue their work. Laws like India’s section 3D deny patents for modern, improved medicines. They do what no other industrialized nation on Earth has even considered: conflate a drug’s efficacy with its patentability. Section 3D asks the near impossible – to show that a new drug is effective at the beginning of the process, when the patent is sought. Provisions like this dissuade potential Indian innovators and entrepreneurs from even entering the field of biotechnology.
Embracing global IP standards on biologics gives innovators a time limit on their patent and the profits that come with it. This ticking clock incentivizes them to always keep one eye on the future – on the next disease to cure.
Biotech innovators are not afraid of biosimilars. But the word “similar” only has meaning in reference to work someone else has done. BIO negotiated an 8-year window for biologics protection in the Trans Pacific Partnership. The world’s leading biotech producers, the United States and Europe, have 12- and 10-year windows of protection for the data that biotech companies compile at great expense.
If your government joins the global community on IP rights, your industry will see a tidal wave of biotech investment and expansion right here in Gujarat. Because with India’s remarkable STEM workforce and low R&D costs, the potential to innovate here is virtually limitless.
Your second major policy challenge is related to the first: The Indian government must create a more attractive climate for biotechnology investment, so innovators can access the capital they need to research and commercialize their products.
I think it’s important to acknowledge that Gujarat today is led by a man who understands this. Chief Minister Rupani has only been in office for a few months, but his emphasis on making it easier to do business here has been received by leaders in the industrial sector. We know how successful you’ve been in attracting major players in the auto industry to Gujarat for R&D and manufacturing – companies like Tata, Ford, Honda, Suzuki.
With a biotech base here that’s 175 companies and growing, I think you have a real foundation to build on. You’re the only state with a biotech venture fund. You’re offering a 10-month weekend course in both business and life sciences because you understand that being a good scientist isn’t enough to succeed as a biotech entrepreneur; you also have to be a savvy business leader.
I also commend Gujarat for creating leasing incentivizes for biotech incubators. These incubators are incredibly important. The U.S. funds a federal program that exports the Silicon Valley incubator model to our cities with strong research universities. Incubators provide entrepreneurs with a physical location where they can research, receive mentorship and learn from one another. They also serve as real hubs for investment.
But here’s the sober reality: There is only so much Gujarat or any state government can do to attract biotech investment in a country with loose IP laws and strict price controls on many biotech products. That’s going to be a tough sell to potential biotech investors.
Biopharmaceutical companies spend billions of dollars to research, develop and secure government approvals for new treatments. These billions come from just two sources: investors and sales revenue from existing treatments.
Basic economics tell us that to attract sufficient investment, an industry’s returns must be commensurate with its risks. The biopharmaceutical industry is among the most hazardous sectors for investment. Our projects – and our companies – have a 90-percent failure rate.
Therefore, investors require a strong return when they do finance a success. Their confidence in our industry’s ability to deliver healthy profits for a small number of winners fuels the entire system.
Patent infringement and government-imposed price controls are the surest way to drive away the investors who finance global medical innovation. When government steps in and artificially controls prices of medicines that took our companies billions of dollars perfect, they’re doing so at the expense of future innovation – and the hopes of millions of sick patients who are counting on our industry to find a cure for their condition.
The United States – like India – struggles with the moral dilemma of making cutting-edge medicines more affordable without stifling innovation. We address this issue by embracing a highly competitive generics market. Today in America, nine out of 10 prescriptions are filled with low-cost generic medicines. Once a medicine’s patent expires it becomes a societal good – a commodity that can be sold at a dramatically lower price for decades to come. This is how we ensure a climate of continuous medical innovation and improvement, while getting needed medicines to millions in need.
Another way to lower drug spending is to initiate performance-based reimbursement. Many drug innovators are willing to be reimbursed only if – and for as long as – their products are effective. This is the essence of precision medicine. If a miraculous, one-time treatment like a gene therapy can cure a patient who would’ve otherwise died or suffered at great expense, perhaps that therapy is so valuable that its reimbursement can be financed over as many years as its effectiveness lasts.
Ultimately, biotechnology innovation results not just from scientific and entrepreneurial genius, but also from the wisdom and political courage of our elected and appointed government officials. We depend on their willingness to champion policies that reward risk-taking, But here’s the key point: This will happen only to the extent that you educate them about their vital role in our ecosystem. Our industry’s best spokespeople are the scientists sitting in this room.
So the question I’ll leave you with today is this: Will India embrace its tremendous potential to innovate, or be content to merely imitate?
As biosimilar competition rises from China and South Korea, will India harness its incredible human capital and make the transformation up-market and join the global leaders of biomedical innovation?
Will India embrace broadly shared global norms on IP rights – and welcome the wave of foreign investment, new jobs, international partnerships and M&A that such a decision would bring?
Indians were born to innovate. I see this in America every day. We have 3 million Indian immigrants – and 75 percent of them have college degrees. Indian-Americans have the highest per capita income of any ethnic group in my country. They are highly educated, creative and driven. More than 300,000 Indians work in Silicon Valley. Many American biotech CEOs are of Indian descent.
Prime Minister Modi is right. Brain drain can become brain gain. The Indian-American executives I talk to want to send more than remittances back home. They want to send jobs. They want to send investment dollars. They want to expand their global value chains. The steps your government takes on policy will determine your industry’s future.
So, in closing, let me offer my sincere thanks for this chance to be with you. For hearing me out. And for giving some thought to the case I’ve tried to make. At the end of the day, innovation isn’t about whose company makes more money. It isn’t about whose government gets more credit. What we’re about is working together to give our greatest resource – our people – the support they need to cure disease. Because a mother holding a sick or dying child in her arms doesn’t care whether the medicine that can save her baby’s life is innovated in Boston, Beijing or Bangalore. She just wants her little boy or her little girl to get better. So do we all.
So thank you again for the critical work you’re doing in the field of biotechnology, and Godspeed as you work to realize a boundless and innovative future.