Dr. Kiran Mazumdar Shaw recounts how difficult it was for her to obtain capital and she notes that many young women entrepreneurs continue to face the same difficulty
Women are breaking barriers and making their mark in the business world like never before. This surge in female leaders is not only changing the landscape of entrepreneurship but also having a positive impact on business growth and innovation. Dr. Kiran Mazumdar Shaw is one such successful entrepreneur who has served as an inspiration to thousands of women around the world who aspire to become business leaders. She is the Executive Chairperson of Biocon Limited and Biocon Biologics Limited, and she has over four decades of experience as an entrepreneur and global business leader in the biotechnology industry.
As a prominent advocate for women’s empowerment, Dr. Kiran Mazumdar Shaw has actively worked towards breaking barriers for women in business and science, inspiring countless aspiring entrepreneurs and scientists.
Dr. Shaw talks about the challenges faced by women entrepreneurs, the biosimilar sector, and the use of AI in pharma, among many other things, in a freewheeling chat with ET Edge Insights.
Viatris acquisition has been an important acquisition for you, how do you see the future growth prospects?
So obviously the Viatris acquisition has been a game-changing acquisition for us. It’s something that propels us into a global company. It accelerates our aspiration to be a front facing company in terms of being a fully integrated Biosimilars company. This is a very interesting acquisition opportunity that we seized because it was unlike most of the acquisitions that are very complex and because you are acquiring a business that requires you to look at building efficiency through looking at redundancies. But in this case, it allows us to bolt commercial engines in advanced markets which we have not had until now. And we had expressed our indication of doing this in five years. It just advances that whole process.
So today it gives us the unique opportunity to become a global leader in biosimilars with end-to-end capabilities of lab to market, as we were already conducting R&D and manufacturing and can now also engage in commercial front-facing activity. As a result, from capturing only 30% of the value of the biosimilars business, we now capture 100% of that business value.
How do you assess the future of India-made biosimilars in the foreign market?
Biosimilars are going to be a very important drug segment because, like generics, they are the ones that will help reduce health care costs. And today, of course, you can see that the adoption of biosimilars in both the US and Europe is only increasing by leaps and bounds. Similar to how it took time for generics to be widely accepted by payers and HMOs, I believe the same is true for biosimilars today. I believe we are on the verge of a massive surge in biosimilar adoption.
India should be a major global player in biosimilars globally because it has been very successful in leading the way in generics. However, the investment requirements for biosimilars are an order of magnitude greater than those for generics and Indian companies will need to get used to this. At Biocon, we started on the biosimilars journey ten years ago. We understand the model and know exactly what it entails, so we keep developing our pipeline. However, not many Indian businesses have taken this route, and the high costs associated with research and development and production mean that progress is slow. Naturally, Indian businesses will need some time to develop into biosimilars powerhouses. So, we are trying to lead the way and hoping that others will follow.
How much does India spend approximately in R&D? And is there a role the government has played towards accelerating this process?
If you look at India, we spend less than 1% on R&D, which is too little and even the pharmaceutical industry invests less than 5%. The pharmaceutical industry spends roughly 3% of revenues on R&D, whereas the majority of large pharmaceutical companies spend between 12 and 15%. I believe we are the only company investing at that level in R&D this year. By year’s end, our investment in R&D will be 16% of the revenue.
Most Indian companies spend between 3 to 5% and if you want to move the needle, you must spend more than that. So, I will say it again: if people want to invest in biosimilars, they will have to spend a lot more money. They will have to at least double their expenditure. And that’s not happening because doing that affects your EBITDA and your profits. Now, the good news is that we have developed a model so robust that we’re among the industry leaders in terms of EBITDA despite spending 15% of our revenue on research and development. This demonstrates how strong the business is.
We have seen how AI is influencing every business; how do you think AI is impacting the biotech industry, and how do you see the future?
I think the pharma industry is very aware of the benefits of both AI and automation. And I believe we need to examine how we can use AI intelligently and accurately, because one thing you must realise about AI is that it requires a large amount of normalised data. When you look at normalised data, unless you are working with a huge data set, it is all about big data analytics and algorithms, which enable you to use AI in a highly predictive, precision-oriented manner. If you are attempting to adopt AI models without sufficient data, the results will be unpredictable.
What’s your view on Chat GPT?
ChatGPT is a useful application. However, it depends on the input you provide to ChatGPT in comparison to its output. I have used ChatGPT a lot. I would say that 50% of the time it is wrong and 50% of the time it is right. I believe ChatGPT should be used for standardised information, such as standard operating procedures or documentation. I believe ChatGPT can do it better. Because Chatgpt focuses on grammar and syntax, among other things. Concurrently, I worry that young people will lose the ability to think creatively to construct language in a proper way and instead rely solely on Chatgpt. We all learned how to write creatively and learn spelling and language skills as kids, I hope we don’t lose that.
What are the key challenges faced by women entrepreneurs?
I believe that the biggest hurdle a woman entrepreneur encounters is limited access to capital. Access to capital is extremely challenging for women, and this has not changed since I founded Biocon 45 years ago. I had a very difficult time accessing financing. Even in the present day, I observe that many young women entrepreneurs face the same hurdle. Capital is in the hands of men and there is a gender bias when it comes to providing access to that capital. So, I think women have to be considered in a very different way when they are loosening those purse strings. So, I think access to capital is the biggest issue.
Secondly, I think women do find it difficult to build strong teams. I think people are varied about joining women in businesses. I had that problem when I started Biocon, but over time I overcame it by building a very successful company. I think women entrepreneurs face that same problem even today. When they build a successful company, obviously, people want to join them. But until they reach that stage, I think there is a lot of variation about joining women-led businesses because there is a bias in thinking.
What are the key challenges that organisations face in achieving gender equality in the workplace and how can they address these challenges?
Gender-related issues are at the top of the mind of every corporation. In my own company, although it is a woman-led business, I am very keen to see that there is equal representation of genders in the workforce. Certain departments have decent gender ratio while certain departments lack women employees.
I am trying to force my managers to come up with solutions on how we get women to participate in every part of our business. Our R&D department has the best representation with 40% of our researchers are women but then when I look at my manufacturing division the numbers drop to less than 20% and the number is even worse – roughly 10% in sales. You will be interested to know that the numbers have significantly improved in manufacturing and now we have over 20% women employees. We have created women-only teams in certain units which is working very well. I think we can do it; I would like to have a 50-50 gender ratio. Earlier women used to come in general shifts only, now that has changed and that is why it is possible for women to play a bigger role in manufacturing.
One of the things that we are doing at Biocon is to make DEI part of the KRA of the leaders and that is working very well. I believe it is really about people being sensitized to the needs to have more women in the workforce and once women start performing and efficiency starts increasing that will move the needle.
