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Summary of Project Information (SPI)

This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only.
Project number22787
Project nameBharat Biotech
SectorPharmaceuticals and Medicine
Environmental categoryB
Date SPI disclosedJune 24, 2004
Projected board dateJuly 30, 2004
Previous EventsInvested: February 2, 2006
Signed: May 26, 2005
Approved: February 16, 2005

Description of company and purpose of project
Bharat Biotech International Limited (Bharat or the company) is involved in three activities:

- the development and production of vaccines,
- contract development and manufacturing for Western based pharma/biotech companies, and
- the development of its own line of molecules.

The key uses of the project investment are for:

- upgrading and expanding current facilities;
- increasing contract manufacturing;
- increasing marketing and sales to expand revenue both in India and for exports;
- increasing product R&D.

Project sponsor and major shareholders of project company
The sponsor of the project is Bharat Biotech, which was founded by Dr. Krishna M. Ella. Dr. Ella holds a doctorate from the University of Wisconsin, Madison and who has over two decades of research experience in biotechnology programs at various universities such as the University of Hawaii and the Medical University of South Carolina. He has over 30 international publications to his credit and has been appointed by the Government of India as a board member of various national programs such as the Indo-USA Joint Vaccine Action Program, the National Task Force on Industrial Biotechnology, the Task Force on Drugs & Pharmaceuticals and the National Health Mission.

Bharat Biotech is owned by Dr. Krishna Ella and Associates (mainly management and angel investors) (77.1%) and by IDBI (22.9%).

Total project cost and proposed IFC investment
The total project cost has been estimated to be more than $20 mm. The proposed IFC equity investment into the company would be $6.0 mm.

Location of project and description of site
Bharat Biotech International Limited (BBIL) is located at Turkapally Village, Genome Valley, Shameerpet Mandal, Ranga Reddy District, Andhra Pradesh State, India, which is only 35 km from city of Hyderabad.

Project Development Impact and IFC's Role
The project will achieve the following developmental impacts:

- strengthening India’s biotechnology sector;
- increasing vaccine production and distribution (especially in rural areas), which is one of the most cost effective way to prevent diseases and improve the health of a country;
- bringing high quality jobs to India in the area of health related research and development, through the expansion of R&D (Bharat currently employs 19 scientists but will increase its R&D workforce as its contract research business expands);
- supporting a company committed to the highest international standards with FDA and EU approvals being sought for its products and facilities; and
- allowing a company producing high value added products to increase its capacity and exports.

In addition, IFC will look into supporting Bharat Biotech with their efforts to deliver low cost vaccination to rural areas (possibly through the Corporate Citizenship Facility - CCF).

IFC role:

This project fits well with IFC strategies as:
- it stimulates the development of the developing biotech industry, which has the potential to become a notable part of the international services sector in India, alongside the IT industry; and

- it supports the development of high quality pharmaceutical/health care research in India by providing employment and training to scientists working in biotech research.

In addition, IFC’s involvement will have additional benefits to the company by:

- providing needed equity capital to commercialize already patented products with a proven technological track record;
- mobilizing additional capital for a mid-stage biotechnology company by working with co-investors; and
- most importantly, help the company structure a sound financing plan. IFC has worked with the Gates Foundation, with the World Bank health team responsible for vaccinations, and has talked to many vaccine companies in the recent past. It has an understanding of the vaccine market, which could help Bharat develop its business. This process would be assisted by IFC having a board seat.

Environmental and social issues - Category B
This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because limited environmental and social impacts can be mitigated by adhering to industry best practices, recognized performance standards, guidelines, and/or design criteria. Environmental, health and safety issues associated with this project include: solvent recovery system for manufacturing operations; waste minimization programs to reduce water consumed and waste water volumes; waste water treatment compliant with IFC/WBG guidelines limits; use of hazardous material in compliance with IFC guideline requirements; environmental, occupational health and safety programs to ensure consistency with IFC guidelines and international requirements such as ISO 14001 and OHSAS 18000. General compliance by the company with all applicable IFC/World Bank Group policies and guidelines.

To view the environmental documents for this project, click here

Location of environmental documents in locally affected community
Environmental documentation will be made available within the company headquarters.
The address is as follows:

Vamsi Sadan Plot #265/266
Kamalapuri Colony Phase II,
Hyderabad-500 073

To contact the project company, please write to:
Dr. Krishna Ella,
Vamsi Sadan Plot #265/266
Kamalapuri Colony Phase II
Hyderabad-500 073