Investing in Life Science in India

1
Investing in Life Science in India

• The Venture View
• Anula Jayasuriya, MD PhD
• ASSOCHAM March 28, 2006

2
Why Am I Here?

• To Meet the future Nano-Bio Billionaires!
• To find and fund these superstars
• Huge Opportunity in India
• Both technology Innovation in India and transfer
  of Technology to India
• Skills base

3
Venture vs. Private Equity

• Stage of company early v. expansion
• Level of risk high v moderate
• Revenue pre v. post
• Size of Investment smaller v. larger
• Assessment Focus technology v. financial
• VC creates the deals for PE
• 2005 PE and VC in LS 217 MM in 13 deals

4
What does LS Encompass?

• Therapeutics novel and generic
• Diagnostics
• Devices
• R D Tools and Reagents
• Instruments
• Health Care Delivery hospitals, clinics
• Services
• CRO Chemistry Labs Pharmacy

5
What VCs Look For

• Need addressed by disruptive technology
• Technology backed by defendable IP
• Business model
• Valuation/Exits IRR 5-10x return
• Cost of development and time lines
• Competition

6
Why VC is Important

• Big player in any tech boom
• Small cos challenge establishment disruption

7
Biggest Challenges in India

• Deal Flow
• Management Skills
• IP
• Business culture differences (own the task rather
  than the problem control family businesses
  term sheets
• Exits

8
Business Models

• CRO/MFG/services fee for service
• Collaborations/ JV Risk Sharing
• Wholly owned Subsidiary of Ex US co
• Wholly Indian Company

9
VC Value Proposition

• Financing long-term equity
• Business Partner share risk and reward
• Networks Access to expertise and alliances
• Mentoring
• Exit

10
DFJ Suriya Fund

• LS investments in US-India corridor
• 50-100 MM
• Value creation in India beyond pure outsourcing
• Two partners in India one in the US
• DFJ sponsorship