GlaxoSmithKline Biologicals in talks to buy BE's vaccine division

Bangalore: GlaxoSmithKline Biologicals , a division of global drug giant Glaxo, is in talks with the Hyderabad-based Biological E Ltd (BE) to purchase its vaccines division , people familiar with the discussions said.

This division produces and markets a range of paediatric and adult vaccines and has a sizeable market share in the Indian vaccine market . Officials from Glaxo Biologicials, which is based in Belgium, recently visited the Indian firm's manufacturing facility in Shameerpet near Hyderabad, people close to the development said.

Biological E managing director Dr Vijay Kumar Datla did not respond to an emailed questionnaire on the issue. A Glaxo spokesperson in Mumbai declined to comment.

BE, which has already invested around Rs 350 crore for its facilities, has three key divisions, biologics, pharma and public markets. Biologics makes paediatric and adult vaccines, while public markets is in charge of distributing all kinds of vaccines to the state and central govt and public health services.

The talks are believed to be at a preliminary stage. The Biological E's website says that it was the first private sector company to enter the vaccines market. Diphtheria and tetanus vaccines are some of its key products and this has given BE a significant share of the Indian vaccine market. Its pharma division manufactures solid dosage forms, liquid orals, syrups and active pharmaceutical ingredients catering to both local and international markets.

A pharma analyst said Glaxo had recently faced some constraints in supplying vaccines to its markets around the world from its plant in Nashik, Maharashtra. It would be interested in buying out companies with modern manufacturing facilities approved by international agencies like US FDA, said the analyst, who did not wish to be quoted because he is not authorised by his firm to speak. He also added that GSK Biologicals is globally huge in paediatric vaccines and BE's expertise in that segment would offer excellent synergies in terms of a strategic fit.

Glaxo was also believed to be interested in Shantha Biotech which was eventually sold to French drugmaker Sanofi's vaccine division for $ 780 million in 2009.

The Belgium-headquartered GSK Biologicals is one of the world's leading vaccine manufacturers and employs more than 1,000 research scientists. As per a previous company statement, in India, the division leads the vaccine market in terms of market share and also exports vaccines to both developed and developing markets.

LED maker Lighting Science to foray into India by September

New Delhi: US-based LED manufacturer Lighting Science Group, a global leader in its business, plans to enter the Indian market by September with an eye to grab 20% share of the market over three years.

The company is in advanced talks with three to four domestic LED manufacturers to float an Indian joint venture (JV), industry sources said. Lighting Science Group will hold a majority stake in the joint venture to be named Lighting Science India. The company plans leveraging existing retail network and manufacturing lines of its Indian partner.

Lighting Science Group managing director (India) Arun Narayan told ET that the current Indian market is estimated at $40 million (about 180 crore) and is likely to grow to $400 million (Rs 1,800 crore) by 2014. The company, managed by $2 billion Pegasus Capital Advisors, has applied for Nasdaq listing.

"Lighting Science India targets 15-20% of the growing market," said Narayan. The Indian LED market is in a nascent stage with a few major players like Philips and Crompton Greaves . In India, LED bulbs are about 4-5 times costlier than incandescent bulbs and compact fluorescent lamps (CFLs). Lighting consumes about 20% of energy and LEDs can bring it down to 4%, said Narayan.

Australia , the United States and European Union have barred use of incandescent lamps. In order to encourage use of the energy efficient bulbs, the government in budget 2011-12 halved excise duty on LED bulbs to 5% while the special counter veiling duty of 4% was abolished.

Lighting Science Group expects to earn the majority of its revenues in India by supplying LEDs to local municipal authorities for street lighting. The company also targets to sell its product to industrial units. Retail sales of LEDs would begin in the next two years, Narayan said. The government has recently asked eight industries, including thermal power projects, fertiliser, cement, and iron & steel manufacturing units, to comply with energy efficiency norms. Units consuming more energy than designated would be penalised. It is expected that the nine sectors would have to invest about 30,000 crore over the next three years to comply with the norms.

Lighting Science Group would initiate talks with state governments, local authorities, real estate developers and industrial units for supply of products. The company has engaged Dixon as its first distributor and would form tie-ups with more regional distributors.

Venus Remedies successfully completes Phase I & II clinical trials of cancer detection molecule

Chandigarh: Chandigarh-based Venus Remedies Limited has successfully completed Phase I and II clinical trial for VRP1620, a cancer detection molecule. The clinical study has shown excellent results in detection of breast cancer. With this drug, detection of breast cancer would be possible even with a simple X-ray using dye and the sensitivity of other detection devices such as coloured doppler, PET would be increased several times.

On the occasion Manu Chaudhary, Research Director of the company told, “VRP 1620 (Tumatrek) is a unique and cost effective diagnostic tool for cancer which can also detect malignancy even through X-ray. It can detect cancer at lesser cost and at primary stage itself.” By detection of cancer at early stage it can increase the cure rate. Scientists believe that after Phase III trials of this product VRP-1620 may also help in locating proliferation of cancer site.

GVFL in talks with global PE firms

Mumbai/Ahmedabad: With the Gujarat Venture Finance Limited (GVFL) receiving first tranche of Rs 200 crore from the state government, the venture capital (VC) firm is now aiming to raise around Rs 500 crore of its Rs 1000-crore infrastructure fund - Golden Gujarat Growth Fund Series-1 by June 30, 2011. What's more, GVFL is also in talks with domestic and international funding institutions like private equity companies, banks, insurance firms and pension funds to raise the remaining funds.

The first closure is expected by June 2011 with available funds of Rs 500 crore and the final closure will take place after a year, in June 2012. However, the company would start appraising project proposals and would start taking up due diligence of the infrastructure projects from May 2011 onwards.

"The first fund closure will take place by June this year. But simultaneously we will also start considering the prospective projects for investments. From May 2011 onwards we intend to initiate the process of due-diligence of the projects. We are hopeful to get funding commitments from the companies by then. Currently, the talks are on with domestic and international financial institutions," said H C Pattnaik, executive director, GVFL. So far GVFL has approached financial institutions like LIC of India, Asian Development Bank, SIDBI and a few international private equity firms.

Gujarat government will contribute 20 per cent of the total fund size, while anchor bank and anchor industry would contribute 10 per cent each for the fund. The remaining 60 per cent will be raised from domestic and international institutional investors. The state government has made a budgetary provision of Rs 200 crore for the fund in the annual budget 2011-12 presented in February.

State-promoted venture financing company, GVFL had announced the Rs 1000 crore infrastructure fund during the Vibrant Gujarat Global Investors' Summit 2011 held in January this year. The fund has been registered with Securities and Exchange Board of India (SEBI) and would invest in the companies from high-end small and medium enterprises segment to mid corporate firms having operations in infrastructure space and alternate energy including green and clean technology.

Some of the companies and investment bankers have already started approaching GVFL with investment proposals for projects development.

"We are receiving enquiries and investment proposals from investment banks and companies. But we have not identified any project so far. It will be decided after the due-diligence of the projects from May onwards," Pattnaik informed.

The seven year fund is expected to yield average internal rate of return (IRR) of around 20 per cent for the investors. The Gujarat government holds 56 per cent in GVFL through public sector units while HDFC holds 13.6 per cent. ICICI Group and other entities have around 20 per cent stakeholding in the company.

Cabinet nod to set up panel for two fab plants

New Delhi: The Union Cabinet on Wednesday approved setting up of an Empowered Committee to identify technology and investors for establishing two semiconductor wafer fabrication (fab) manufacturing facilities.

The decision is expected to have a significant impact in resolving issues in the capital-intensive electronics hardware sector and help the industry develop localised content. Investment for the two wafer fabs is estimated to be Rs 25,000 crore.

The committee comprises adviser to prime minister on public information, infrastructure and innovation; chairman of National Manufacturing Competitiveness Council; secretary, Department of Expenditure; member (industry), Planning Commission; M J Zarabi, former chairman and managing director, Semiconductor Complex Ltd; and secretary in Department of Information Technology. It may co-opt any other experts.

It will identify technology and potential investors for the establishment of semiconductor wafer fabs, and thereafter ascertain their interest in setting up of fab facilities in the country. It will assess and recommend the nature and quantum of government support like equity, grants, subsidies in physical and financial terms to set up the facilities. It will submit its recommendations by July 31.

The fabs are expected to have catalytic impact on development of downstream and upstream products, including ancillaries. It may have sizeable impact on the development of IT/ITeS sector. It will generate employment for 30 million people by 2020.

Nasscom sees strong spurt in tech demand

New Delhi: Technology industry body National Association of Software and Services Companies (Nasscom) sees a strong revival of demand that could not only help meet, but even exceed, growth expectations for 2011-12. Newly-appointed Nasscom chairman for 2011-12, Rajendra S Pawar said in an interaction with ET: "We are coming back to growth levels seen prior to the slowdown and in the near term we see lot of headroom to catapult this growth.''

When asked whether this means Nasscom will revise its 15-17 % growth target for the year for the $70 billion technology and business services sector, Pawar said, "it's too early to comment, but we are on track to exceed this target.'' Pawar, 60, co-founder and chairman of education software company, NIIT , took over as Nasscom chairman from Harsh Manglik. Nasscom also appointed N Chandrasekaran as vice-chairman of it's executive council. Chandrasekaran is CEO and MD of Tata Consultancy Services , the largest Indian technology services company.

As chairman of the executive council, Pawar will lead and assist Nasscom in catalysing the growth of the Indian IT-BPO industry and enabling the sfulfilment of its future goals and aspirations. Towards this end, Pawar wants to focus on two areas. First, how Nasscom will facilitate growth of the small and mid-sized companies. "There are a lot of SMEs focused on software products, telecom, internet space, all driven by intellectual property. By the end of this decade we see quite a few of them becoming very big,'' Pawar said. And second, 'IT for India', that is, how Nasscom can help in e-governance projects. "Government technology initiatives are beginning to get critical mass. We will engage with these projects and see what opportunity is available to companies,'' he added. Besides, Nasscom will push for private sector partnerships in e-governance projects.

On sops to industry, particularly for SMEs, Pawar said, "we will align with the new direct tax code. The new tax regime is supportive of growth and will help the industry.'' Pawar takes over at a time, when on the one hand the industry is coping with quality of talent issues and on the other, later in the year, could see a return of the anti-offshoring wave, as build up for the US elections starts. On strategies to cope with these Mr Pawar said "talent is a big issue and industry will have to accelerate shifts to new models (like de-link revenue and manpower growth) and focus on innovation. On anti-offshoring , we will be engaging a lot more with various stakeholders.''

India's refining capacities to rise to 240 MTPA by Mar 2012

Mumbai/Ahmedabad: India's petroleum refining capacities is expected to rise to 240 million tonnes per annum (MTPA) by March 2012 from the current 188 MTPA, attracting an estimated investment of Rs 60,000-65,000 crore. The capacity addition is believed to boost country's exports of petroleum products, informed a top government official here on Wednesday.

S Sundereshan, secretary, ministry of petroleum & natural gas, government of India today stated that the country would have an excess petroleum refining capacity of around 90 million tonnes per annum in next 12 to 18 months.

"Currently, we have an installed refining capacity of 188 MTPA, while several green field refinery projects are lined up and are expected to be operational by March 2012. This will increase the total refining capacity to 240 million tonnes," he said adding that the new refining capacities would attract an investment of around Rs 60,000-65,000 crore.

Currently, India's total demand for the petroleum products is pegged at around 140 MTPA. This creates a spare capacity of 48 million tonnes per annum at the refineries. The spare capacity will increase to around 90 million tonnes per annum. The domestic demand is expected to be around 142- 143 tonnes per annum.

"We will be actually exporting a total of 90 million tonnes of petroleum products to some of the most developed countries including the US and European countries," added Sundereshan.

I-T Dept begins work on real-time network

New Delhi: Aim is to integrate the entire collection network, to enable instantaneous monitoring.

The Income Tax (I-T) Department has embarked on a plan to create a national data centre to facilitate a management information systems-based, real-time analysis of data for quick and effective decision making.

There will be a single custodian of all data captured by the integrated system. The MIS advisory panel of the department has recommended that the Directorate of Organisation and Management Services will be the nodal agency for all statistical data.

In the new system, reports of the investigation wing associated with search and seizure activities would be filed within 24 hours. Daily collection reports would be generated through the system and made available to the top management.

The advisory group has suggested the new MIS format be implemented with immediate effect. The required capabilities are being put in place.

The system will have safeguards to ensure security of all information assets and the database, through systemic implementation of periodic vulnerability testing, security and forensic audits to prevent fraud.

A senior official told Business Standard the requisite for online report generation was to ensure all actions by the field officers were done through the system. The Central Board of Direct Taxes (CBDT) is to issue instructions in this regard soon.

“The ultimate objective is to create a single data centre under a single custodian for storing all taxpayer and third-party data. The system will facilitate business intelligence out of processed data and make it available to the actual users on almost a real-time basis,” he added.

The plan envisages augmented computational capability and network connectivity for handling huge data volumes. “This would be a uniform holistic rule-based application matrix that can optimally run on state of the art hardware and networks,” said the official.

The idea is to integrate all the elements of tax collection through technology, with information seamlessly flowing to the users for informed decision making.

The CBDT MIS advisory panel was constituted in the backdrop of the reiteration by Parliament’s Standing Committee on Finance in September 2010 of the urgency for implementation of an action plan in this regard. The panel was asked to come up with an implementation plan so that work on it could be initiated from the first month of the current financial year.

Service tax reduction likely for inland shipping

New Delhi: Transport of goods through coastal and inland shipping may get cheaper, as the finance ministry is planning to increase service tax abatement for the sector. A higher abatement is being proposed to bring some parity in levy of service tax on movement of goods through road, rail and shipping.

The service tax on shipping was introduced in Budget 2009-10. In Budget 2011-12, the government provided an abatement of 25 per cent on transport of goods through coastal and inland shipping.

Shipping secretary K Mohandas has now written to the finance ministry, asking for higher abatement. “We are considering the proposal to increase abatement for coastal shipping. We want to promote coastal shipping because it is an energy-efficient, environment-friendly and economical mode of transportation of goods,” said a finance ministry official, who did not wish to be identified.

The industry has been asking for uniformity in service tax abatement between shipping and other transportation modes such as road and rail.

The finance ministry gives 75 per cent abatement in case of road transport. It has also provided 70 per cent abatement for the railways.

Service tax on rail freight, however, is yet to come into force, as the finance ministry had again deferred its introduction, till June.

The official said the abatement could not be as high as 75 per cent and the finance ministry could increase it to only 35 per cent. This would mean a coastal operator would have to pay service tax at 10 per cent on 65 per cent of the total freight value, compared with a road operator, who would pay service tax on 25 per cent of the freight value.

The finance ministry has asked the shipping ministry to provide data on the cost of services involved in transporting goods from one place to another through coastal and inland shipping.

“We want to know the cost of service element in shipping. Our analysis said it is about 75 per cent. That is why we gave only 25 per cent abatement. If they say it is less and substantiate it with relevant data we will give them abatement accordingly,” the official added.

In its vision document for the next 10 years, the shipping ministry had set a target of increasing port capacity to around 3,200 million tonnes, with an investment of about Rs 3 lakh crore.

It has proposed to enhance the Indian tonnage four-fold by 2020, improve India’s share in global shipbuilding to five per cent and increase the share of Indian seafarers to at least 10 per cent.

Government tells states to upgrade statistical divisions

New Delhi: The Centre has asked states for specific plans to help strengthen the statistical system, for which $107 million (Rs 470 crore) has been sanctioned in collaboration with the World Bank, as the veracity of various statistical data has drawn flak.

M S Gill, Union minister of statistics and programme implementation, has written to all chief ministers to also ensure their existing statistical divisions are upgraded to a separate department of statistics to improve the quality of data.

The National Statistical Commission under the chairmanship of C Rangarajan had recommended the elevation of statistical divisions in states.

“The ministry is undertaking the centrally sponsored scheme, ‘India Statistical Strengthening Project’ in collaboration with the World Bank... to strengthen the statistical system of state/UT governments for collecting, compiling and disseminating reliable statistics for planning and policy making,” the letter said. The letter asked states to upgrade their directorates of economics and statistics to a separate department of statistics.

Heads of the existing directorate should be scaled up to the level of secretary to the state government, Gill said.

He wanted existing directors be closely involved in the decision by making them members of committees or groups dealing with plans and programmes.

The letter further asked states to create a common statistical cadre and state statistical service for manning statistical posts in all departments.

This will empower the directorate in discharging the role of a nodal agency, effectively laying the grounds for developing a sound statistical system, that will improve the growing requirements of planners and policy makers for informed decision making.