|
One
day in January, some three months after she changed her company's
work timings to 7.30 a.m. to 4 p.m. so that employees could come
in to and leave work without spending hours on Bangalore's chaotic
roads where the traffic in peak hours can be killing, 52-year-old
Kiran Mazumdar-Shaw decided that she had had enough. The state
government did not seem bothered by the city's crumbling infrastructure,
politicians of various hues were busy taking potshots at N.R.
Narayana Murthy, the iconic Chairman of Infosys Technologies,
for speaking his mind about just what needed to be done, and things,
such as the traffic on Hosur Road that leads up to Electronics
City (housing Infosys and several other tech companies), and further
down, to Biocon's office, were rapidly spiralling out of control.
And so, the Chairman and Managing Director of Biocon went on television
and trashed the government. Nothing changed (nothing ever does,
a cynic might say), but the incident was another minor milestone
in the progression of Mazumdar-Shaw from a mere biotech entrepreneur
made immensely rich by an IPO (initial public offering) to one
of the few voices of India Inc., and, arguably, its most powerful
female one.
If power is measured by its trappings, then
Mazumdar-Shaw has it all. Her stake in Biocon is worth Rs 2,059
crore. She is the face of the biotech industry and President of
Association of Biotech Led Enterprises (able), an association
and industry lobby that promises to do for the biotech industry
what NASSCOM, the software industry's equivalent did for it (significantly,
Infosys' Murthy was one of the founder members of nasscom and
was its Chairman between 1992 and 1994). The Biocon campus has,
along with that of Infosys, become a regulation-stop for heads
of states and other assorted dignitaries who visit Bangalore.
And when the Prime Minister wants to discuss issues related to
trade, industry and commerce, Mazumdar-Shaw is among the handful
of CEOs he seeks out (others being the likes of Reliance Industries'
Mukesh Ambani, HDFC's Deepak Parekh and Infosys' Nandan Nilekani).
There aren't too many people in India, men or women, who can claim
similar distinctions.
SIX THINGS YOU KNOW ABOUT MAZUMDAR-SHAW |
»
India's richest woman; her holding in Biocon is
worth Rs 2,059 crore
» Founded
Biocon in her garage in 1978; capital, Rs 10,000
» President
of Association of Biotech Led Enterprises (ABLE), biotech's
Nasscom
» Biocon's
heads of marketing, R&D, finance and operations have been
with the company 20 years
» Biocon
started with enzymes, moved to statins, and now focuses on
bio-therapeutics, outsourced R&D and clinical research
» Conferred
the Padmashri in 1989 |
Brewing Up A Biotech Empire
The story of how a Gujarati Brahmin girl-important
because alcohol is anathema to this community even today-became
India's first female brewmaster and brewed up a biotech empire,
in a classic garage success story, has entered Indian corporate
folklore. Mazumdar-Shaw founded Biocon as an enzyme manufacturer
in the November of 1978; the company worked out of the garage
in her Koramangala house (it continued to do so for three years);
and her initial capital was a mere Rs 10,000. All this is known.
What isn't is her ability to attract and retain talent. Six years
after she founded Biocon, when neither its revenues nor its profits
would have warranted a tag of 'the next big thing', she was approached
by Shrikumar Suryanarayan, a just-graduated engineer from Indian
Institute of Technology, Madras, who wanted to borrow some enzymes
(they were expensive) for a project he was working on. She loaned
him the enzymes, and then convinced him to come to work for her.
Today, Suryanarayan says he is the only one of his class of 1984
who still works in India. "I wanted to destroy the notion,
and this was before the it boom happened, that to work at the
cutting-edge of science or to even earn a decent living, one had
to necessarily emigrate," says Mazumdar-Shaw. "I wanted
to attract the best brains in the business and provide them a
work environment where merit and talent was nurtured to the fullest
and duly rewarded." That she has done: most of Biocon's senior
executives have been made millionaires by the company's April
2004 IPO.
The desire to make Biocon a great place to
work didn't mean the company escaped going through the growth
pangs most start-ups suffer. Nor does it mean Mazumdar-Shaw was
a pushover. In the early 1980s, the company's labour union created
trouble and the lady stood her ground. "Biocon has always
recognised and rewarded talent," she says, "but no one
can browbeat me into making unviable concessions." The labour
unrest prevented Biocon from servicing its Rs 12-lakh loan from
the Karnataka State Finance Corporation (KSFC). Her company was
declared an offender and the government-firm released advertisements
in newspapers stating that its assets would be auctioned, but
Mazumdar-Shaw was not intimidated. "She is a very determined
person," says Vijay Mallya, Chairman, UB Group, and a childhood
friend of Mazumdar-Shaw (her father was Chief Brewmaster at UB
in the late 1970s). "Once she decides on something, she gives
it her all." In this case, she managed to convince KSFC to
hold on, and sacked the troublemakers.
SIX THINGS YOU DON'T KNOW ABOUT MAZUMDAR-SHAW |
»
Trained classical singer (Guru: Ustad Ghulam Rasool
Khan)
» Lives
two km from office in Spanish-themed villa, Glenmore
» India's
first female brewmaster; author of Ale and Arty
» Married
John Shaw, a Scotsman and former CEO of Madura Coats, in 1996
when she was 42
» Only
brother Ravi is a professor at Purdue; Mazumdar-Shaw is a
doting aunt
» Drives
around in E200 and E220 Mercedes cars |
Biocon's most severe challenge, however, was
funding, or the lack of it. "Today, funding options are numerous
and there are individuals and institutions that understand the
sector," says Mazumdar-Shaw. "Back then, there were
really few." Sometime in 1988, in the quest for funds, she
convinced N. Vaghul, then CEO of ICICI (now ICICI Bank), to grant
her an audience. Over breakfast, she managed to convince him to
extend a loan to Biocon. And things looked up. Bala Manian, Vaghul's
brother, a serial entrepreneur based in Silicon Valley, one of
the few individuals in the world who understands the curious coming
together of biotechnology and nanotechnology (his start-up, ReaMetrix
is trying to parlay this understanding into a competitive advantage),
and a member of Biocon's board says Mazumdar-Shaw has the three
things required to make anyone a success. "Kiran has maintained
her connections to her roots through the entire journey to success,
lives the moment with gusto, passion and energy, and wants to
make a difference to other people's lives with her energy and
commitment."
Along the way, Mazumdar-Shaw has also proved
to be a canny entrepreneur. In the early 1990s, she realised the
potential of the market for statins (cholesterol fighting drugs)
long before large Indian pharma companies did. Biocon didn't just
bet aggressively on statins (today, these account for a little
over 50 per cent of the company's revenues), it entered into long-term
supply contracts thanks to which it continues to get better prices
despite prices of some statins such as Lovastatin and Simvastatin
having fallen. And even as prices of statins plummeted, Mazumdar-Shaw
steered her company into bio-therapeutics. Biocon has already
launched human insulin and is working on oral insulin (Pfizer
is working on an inhaler version), a Rs 300-crore opportunity
in India alone, the country with the largest population of diabetics
in the world. And four years ago, when the Centre for Molecular
Immunology from Cuba was scouting for Indian partners to jointly
work on drug discovery, Biocon jumped at the opportunity. Today,
the company's oncological (anti-cancer) product pipeline is overflowing
and some of the products are in early stages of human trial.
|
The Shaws in Glenmore: John Shaw is
in charge of Biocon's international forays |
Biotech's Untiring Advocate
Mazumdar-Shaw, however, isn't just a successful
entrepreneur or rich promoter; she has been an untiring advocate
for the biotech industry. She fought and won the battle to simplify
the procedure to import genetically modified organisms, a key
requirement to tap the massive opportunity in contract research
and manufacturing and spearheaded the move to establish a biotech
park in Karnataka. As the head of India's largest biotech company,
she is closely involved with not just industry, but with academia
as well, leveraging her position as the head of the government's
Biotechnology Vision Group to establish the Institute of Biotechnology
and Applied Bioinformatics in Bangalore. And she has a ready wishlist
of things Budget 2006 could do for the industry. "We want
exemption of customs duty on R&D equipment," she rattles
off. "Patent filing costs should be tax deductible".
"There should be priority lending status for investments
in biotechnology." That kind of focus has won her friends
and admirers within her industry and without. Nandan Nilekani,
President, CEO and Managing Director, Infosys, who has known Mazumdar-Shaw
for over a decade calls her "an absolute role model for first
generation entrepreneurs". "She has the guts to say
what she feels is wrong," he adds. R.A. Mashelkar, Director
General of Council of Scientific and Industrial Research, seconds
that. "Some people have already referred to Kiran as Narayana
Murthy of Biotech! Yet, she has remained a totally humble, humane
and warm human."
|
|
|
"She is a very determined
person. Once she decides on something, she gives it her all"
Vijay Mallya
Chairman/ UB Group |
"Kiran wants to
make a difference to other people's lives with her energy
and commitment"
Bala Manian
Founder/ReaMetrix |
"A
role model for first generation entrepreneurs, she has the
guts to say what she feels is wrong"
Nandan Nilekani
President & CEO/Infosys Technologies |
Even as she lobbies for the sector as a whole,
however, Mazumdar-Shaw faces challenges at home (see Biocon's
Stress Test, Business Today, August 14, 2005). Biocon has embarked
on the risky gambit of the pharma industry's equivalent of discovering
a new molecule (it is akin to an Indian it services firm stepping
off the trodden path and trying to build an operating system that
can compete against Windows). And the company will have to manage
expectations; with few biotech companies listed, Biocon's stock
enjoys a significant scarcity premium and that, in turn, means
that the company's stock trades at 20.3 times its estimated 20006-07
earnings, according to brokerage Motilal Oswal. The report, which
was released after Biocon announced its results for the October-December
quarter, adds that "while this is not cheap" there are
mitigating factors. "The insulin and immunosuppresants markets'
portfolio may bring long-term benefits. A significant expansion
in statin volumes (post patent expiry) can lead to upside in the
short term."
Whichever way Biocon goes-Manian, for one,
believes "it has the potential to become a great global company"-the
fact is, Mazumdar-Shaw's journey so far (she is the head of a
company that will end 2005-06 with Rs 775.4 crore in revenues
and Rs 175 crore in net profit according to some estimates) qualifies
her as an A-lister in the Indian corporate sector. And very few
of her fellow listers can claim to have founded a company, even
an entire industry, as recently as 1978.
-additional reporting by
Rahul Sachitanand
|