Krishna Ella, Chairman and Managing Director of Bharat Biotech.
With the restricted use approval of Bharat Biotech's Covid-19 vaccine Covaxin by India, both Bharat Biotech and its founder Chairman and Managing Director Krishna Ella, 73, have hogged the limelight.
Here are 10 things to know about Ella and his companyWho is Krishna Ella, what is his background?
A yeast molecular biologist by training, Ella hails from a farming family in Vellore district of Tamil Nadu. He went to the US for higher education on Rotary’s Freedom from Hunger Fellowship. After earning his Ph.D. from the University of Wisconsin-Madison, Ella worked as an assistant professor with the Medical University of South Carolina before returning home and founding Bharat Biotech in 1996 at Genome Valley, Hyderabad, together with his wife Suchitra Ella.Lauch of Hepatitis-B vaccine
Bharat Biotech shot into the limelight when it launched Revac-B, a recombinant Hepatitis-B vaccine, in October 1998. Priced at $1, almost 25 cents less than its closest competitor produced by Shantha Biotechnics.What vaccines did Bharat Biotech launched?
The company later launched an oral polio vaccine (OPV). The Hepatitis-B and OPV have prequalified by the World Health Organisation (WHO) helped the company survive and reinvest in research and development for developing new vaccines. The company has indigenously developed and launched Rotavirus Vaccine (RV) against childhood diarrhoea, Typhoid Conjugate Vaccine (TCV), Japanese Encephalitis Vaccine, Influenza vaccine, and a five-in-one Pentavalent vaccine. The company is also developing an inactivated polio vaccine (IPV), as the OPV will be phased out globally by 2023. How does Ella fund his research?
Krishna Ella in the recent press conference said that Bharat Biotech has invested about Rs 1,500 crore into research and manufacturing. The company takes loans, grants, and sold shares to fund research. Bharat Biotech has been occasionally in news for an IPO or raising private equity to give exit to ICICI Venture, International Finance Corp, the investment arm of the World Bank, and Subhkam Ventures have invested in Bharat Biotech a decade back.Business model of Bharat Biotech
Bharat Biotech revenues mainly come from the government of India and other emerging countries, multilateral agencies like Unicef, WHO, and Gavi and other agencies involved in mass immunisation programmes. Along with OPV, Bharat Biotech’s Rotavirus and Typhoid vaccines are WHO prequalified. WHO prequalification of vaccines makes them eligible for supplies to UN agencies and participate in public tenders in developing countries. Vaccine making is a highly competitive business. Indian vaccine manufacturers are facing intense competition from Chinese rivals who have created large capacities, and are driving down the prices. Bharat Biotech gets close to half of its sales from the Indian government. Ella often laments that vaccines in the public market are sold at prices less than a water bottle.Strong revenues growth
For Bharat Biotech, its newer generation vaccines like the Typhoid Conjugate and Rotavirus vaccines have better margin profile and relatively lower competition have begun contributing in a big way in the last 3-4 years. According to the rating firm ICRA, Bharat Biotech FY20 revenues have jumped 35 percent year-on-year to Rs 1,079.7 crore, the net profit rose 200 percent to Rs 298 crore. The operating margins saw significant improvement from 22.1 percent in FY2019 to 42 percent in FY20.Expansion mode?
With healthy cash flows and negligible debt, Bharat Biotech is developing vaccines for Chikungunya, Zika, Cholera, Malaria with considerable investment in R&D and capex, which will be funded through internal accruals and existing cash reserves. The company in February 2019, acquired Chiron Behring Vaccines from GlaxoSmithKline Asia in February 2019. Chiron is a WHO pre-qualified manufacturer of rabies vaccines with a manufacturing plant in Ankleshwar, Gujarat, eligible for supplies to UN agencies and has product registrations in more than 20 countries.Covid vaccine
The biggest of all is the Covid-19 vaccine. Ella moved fast, his early collaboration with ICMR to use its SARS-CoV-2 strain is seen as a masterstroke by rivals. Bharat Biotech has grown the virus and inactivated it through a chemical process. The company started testing the vaccine on animals for safety and efficacy as part of pre-clinical studies. With the support from ICMR and the regulatory body - the company was able to accelerate the whole process of pre-clinical studies and got into human testing by July. Bharat Biotech which had built India's biggest BSL-3 high-containment facility for manufacturing inactivated polio vaccine, has converted it to manufacture COVID-19 vaccine. This could possibly be the main reason that gave confidence for ICMR to give the SARS-CoV-2 strain it had isolated to Bharat Biotech.
BSL-3 is appropriate for work involving microbes that can cause serious and potentially lethal diseases via the inhalation route.How much is he investing in Covid-19 vaccine
Ella said Bharat Biotech is investing Rs. 100 crore on research and conducting clinical trials in FY2021. In addition, the company will invest up to Rs. 200 crore in FY2021 and FY2022 for the development of a greenfield facility for a Covid-19 vaccine. The company proposes to fund the same through internal accruals and cash reserves. Bharat Biotech has been investing this money at its own risk.
"I haven't got any (Bill & Melinda) Gates Foundation money, I have not got any money from (the) government of India, I have taken all the risk of creating a BSL-III facility, we have done clinical trials at our own cost, and manufactured 20 million doses at risk, I never said the government should buy, It's the moral responsibility as a scientist that I should do for the country," Ella said recently taking potshots at its rivals.
Ella said he plans to produce 600 million doses across the company's four facilities, of which three are in Hyderabad and one in Bengaluru.
In addition, Bharat Biotech has also tied up with the Washington University School of Medicine in St Louis, Missouri to manufacture up to a billion doses of a single-dose intranasal Covid-19 vaccine.Scientist with business sense
Ella maintains publicly that he is just a scientist focused on solving the problems of infectious diseases. In the recent press conference, Ella said that "..science is everything in life. I don't know anything about business, neither my family knows about business.". But people who follow Ella don't agree with this. They call him a shrewd operator who understands the business very well. Ella has carefully crafted the publicity around his Covid vaccine on Atmanirabhar.
"Bharat Biotech is among a few companies in the world that have built an impressive end-to-end capability to develop a vaccine," said an executive of a consulting firm who didn't want to be named."Vaccines unlike pharma isn't a glamorous business, it's high risk and capital intensive, you need a lot of perseverance to be in this business, Ella managed to pull this off," the executive said.