Agri-technologies that has high market potential and RoI will be presented in this session which will provide a platform for entrepreneurs, SMEs and agri-companies to understand more about it and an opportunity to start own venture through commercialization of the same.

1. ANIMAL HEALTH IN INDIA
SME BUSINESS OPPORTUNITIES
NIABI 2012
K V BALASUBRAMANIAM
MANAGING DIRECTOR
INDIAN IMMUNOLOGICALS LTD

2. ANIMAL HEALTH IN INDIA
SME BUSINESS OPPORTUNITIES
ABOUT INDIAN IMMUNOLOGICALS LTD
Producer of animal and human vaccines, health & nutrition products
# 1 in animal vaccines, # 3 in animal health in India
# 4 in human vaccines, # 7 biopharma company
# 12 biotech company
Top 3 world producer of Foot & Mouth disease vaccine.
Top 3 world producer of human and animal rabies vaccines.
Major supplier of UIP vaccines – r Hepatitis B, Measles, DPT, TT etc.,
Mission: Biotechnology in healthcare made affordable & accessible.
Service Offerings – Raksha Vet Centres, Indiagen, Abhay Clinics.
Sales Rs 284 Cr ($ 63 mio.) FY 2010-11, Employees 1300.

3. ANIMAL HEALTH IN INDIA
SME BUSINESS OPPORTUNITIES
PRESENTATION OBJECTIVE
About : India - Animal Health Business - SME
Business – Specific Opportunities - Challenges
– Success Factors
Not About : Dairy or Poultry Value Chain Business

4. ANIMAL HEALTH IN INDIA
SME BUSINESS OPPORTUNITIES
1. ANIMAL HEALTH MARKET - PERSPECTIVE
2. FUTURE PROSPECTS
3. SPECIFIC SME OPPORTUNITIES
4. CHALLENGES
5. SUCCESS FACTORS

5. 1. ANIMAL HEALTH MARKET - PERSPECTIVE
PERSPECTIVE - ANIMAL POPULATION
Cattle & Buffaloes 296 mio
(18% of world)
Sheep & Goats 120 mio
(12 % of world)
Poultry - Layers 169 mio
- Broilers 1800 mio
( 10% of world)
Dogs - Street 20 mio
- Pets 0.4 mio
(8 % of world)

6. 1. ANIMAL HEALTH MARKET - PERSPECTIVE
Item Unit per India Developed World
person Countries Average
per
year
Meat Kg 5.1 82.1 41.2
Milk Kg 65.2 207.7 82.1
Eggs Kg 1.8 13.0 9.0
Source: The State of Food & Agriculture 2009, FAO

7. 2. FUTURE PROSPECTS
AH MARKET – FUTURE PROSPECTS
National Dairy Plan to focus on increased milk
productivity
-> Growth in animal breeding, nutrition and
health business
Large outlays in 12th five year plan for disease
control
-> Large business opportunities for vaccines for
cattle & sheep
Growing integration of poultry businesses
-> Higher health and hygeine outlays
Higher emphasis on productive livestock with high
yielding animals
-> Better range and volume of feed and nutrition
Growing ownership of pets as lifestyle statements
-> Opportunities for pet care and pet health

8. 3. SPECIFIC SME OPPORTUNITIES
ANIMAL FEED, NUTRITION & HEALTH
MARKET SIZE
Compounded Animal Feed : Rs 8000 Cr
Health –Vaccines & Medicines : Rs 1700 Cr
Nutrition Products : Rs 700 Cr

9. 3. SPECIFIC SME OPPORTUNITIES
1. COMPOUNDED ANIMAL FEED
Feed requirements of cattle : 60 % home made, 28 %
grazing, 12 % cattle feed
0.5 kgs cattle feed for every 1 lit milk produced.
= Market potential of 60 mio MT
Current market only 6 mio MT i.e 10 % of potential.
Poultry Feed market addl. 2 mio MT
Scope for value added products : specific feeds for
calves, buffaloes, pregnant animals etc.,
Medium size cattle feed plants 50 -100 TPD serving
100 kms radius
Investment cost Rs 5-6 Cr.Turnover Rs 15-30 Cr
Technology – Medium, Available with Machinery
Suppliers

10. 3. SPECIFIC SME OPPORTUNITIES
2. HEALTH PRODUCTS
Indian Mkt Rs 1700 Cr i.e $ 340 mio, Growth
10% p.a
World Mkt $ 18 bio
India 2 % of world AH market. Potential to grow.
Rank 10 (USA 24%,Europe 20%,China 7% Brazil
6% Japan 5%)
Main Product Groups:
Vaccines 31 % Rs 530 Cr
Antibiotics 30 % Rs 500 Cr
Dewormers 17 % Rs 290 Cr
Infusions 5 % Rs 90 Cr
NSAIDS 4 % Rs 70 Cr
Parasiticicides 4 % Rs 70 Cr
Others 9 % Rs 150 Cr
Total Rs 1700 Cr

11. 3. SPECIFIC SME OPPORTUNITIES
2. HEALTH PRODUCTS
Manufacture/Marketing of Formulations
Market Rs 1200 Cr
Investment cost Rs 5-15 Cr. Sales Turnover Rs 15-30 Cr p.a
Technology – Medium ( Tabletting, Orals) – High ( Injectables)
Available with several Consultants
Contract Manufacture of Formulations
Investment cost Rs 5-10 Cr. Sales Turnover Rs 10-20 Cr p.a
Technology – Medium - High

12. 3. SPECIFIC SME OPPORTUNITIES
3. ANIMAL VACCINES
Manufacture of Animal Vaccines
Cattle, Poultry, Canine & Sheep Vaccines
Market Rs 530 Cr
Investment cost Rs 20-30 Cr. Sales Turnover Rs 20-30 Cr p.a
Technology – Medium for Bacterial Vaccines
High for Viral Vaccines, Recombinant Vaccines
Available with IVRI, NRDC, Consultants
Better – Tech transfer

13. 3. SPECIFIC SME OPPORTUNITIES
3. VACCINE TECHNOLOGY TRANSFER – IMPORTANT ASPECTS
Technical
Scale : Large difference between lab, pilot and commercial scale.
Raw Material : R&D uses pure material, commercially unaffordable.
Process Parameters : Better control in Lab scale vs commercial scale
Strain Used : Sufficient data required.
Clinical trials : Adequate data on Immunogenicity, Safety & Efficacy
Commercial
Intellectual Property Rights, Warranty, Training, Demo of Comml.
Batches, Jurisdiction, Training etc.,

14. 3. SPECIFIC SME OPPORTUNITIES
4. NUTRITION PRODUCTS MARKET
Market Size Rs 700 Cr Growth 19 % p.a
Main Product Groups
Vitamin & Mineral Premixes Rs 150 Cr
Calcium Supplements Rs 140 Cr
Mineral Mixtures Rs 100 Cr
By pass Fat Rs 20 Cr
Others Rs 190 Cr
Manufacture of Mineral Mixture/Vitamin premixes/ Supplements
Investment cost Rs 3 -5 Cr. Turnover Rs 10 - 15 Cr p.a
Technology – Low. Available with Machinery Suppliers.

15. 4. CHALLENGES
MARKET CHALLENGES
Small farmer market makes marketing a long haul
Dispersed market puts pressure on distribution costs, esp. vaccines
Trade exerts pressure on margins due to the dispersed market
Affordabilty issues leads to high price sensitivity
Unregulated competition
TECHNOLOGY CHALLENGES
Need to develop products for the Indian requirements
Little R&D on AH products, dependence on human product
extensions
New IPR regime imposes additional diligence demands and research
costs

16. 4. CHALLENGES
MANUFACTURING CHALLENGES
Lower volumes compared to pharma result in higher cost of
manufacture
Contract manufacturing as solution has quality imperatives
Small supporting manufacturers also have quality issues
REGULATORY CHALLENGES
Absence of proper regulatory framework for new drug, esp GM
products
Evolving regulatory environment creates uncertainty in new product
introduction
Licensure a State subject, except vaccines, creates inconsistencies

17. 5. SUCCESS FACTORS
Clear assessment of need-gap in the market.
Build sustainable business model.
Create niche position before expanding.
Differentiated product offerings.
Appropriate technology which is cost effective.
Manufacturing economies of scale.
Adequate investment in sales force with good productivity norms.
Cost effective distribution.
Customer relationship
Performance metrics for manufacturing, supply chain & marketing.
Good management of cash cycle and working capital.
Regular performance reviews and corrections.
Patience, Perspiration, Persistence

18. THANK YOU