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Abstract:

Biocon India (Biocon), the number one biotech


company in Asia in terms of revenues and market
capitalization, was founded in the backyard of a
suburban house in Bangalore in 1978 as a small
operation of enzyme extraction. The woman
behind Biocon - Kiran Mazumdar Shaw (Kiran)
who dreamt of starting her own business with just
Rs. 10,000 in hand and a degree in brewery - is
now the richest woman in India. The case study
describes how Kiran recognized the future
potential of biotechnology industry when not
many people in India knew about it. It describes in
detail the challenges faced by Kiran in terms of
gathering resources when she launched her
biotech start-up. It discusses how Kiran's firm
determination and belief in herself helped in
overcoming the various challenges she faced.

The case then examines how Kiran exploited the opportunities in the fast growing biotech industry in India and the
major steps she took to grow Biocon's business. The entrepreneurship and leadership skills of Kiran are also
discussed. Overall, the case focuses on 'opportunity recognition and exploitation processes,' and 'managing start-up
and growth,' while highlighting the role and importance of women entrepreneurs and the problems they face when
doing business in India...

Issues:

»  Understand the role of an entrepreneur and a leader in creating a start-up and transforming it into a global player
and a leader in its industry.

»  Study the role of an entrepreneur in the struggle, survival and success of a company in the initial and subsequent
stages in the biotech industry.

»  Analyze the leadership qualities of Kiran and identify those characteristics that contributed to the success of Biocon
and made it the leading company in the biotech industry.

»  Understand the significance and impact of a leader on an organization's culture and human resources

Businesswoman of the Year 2004

In November 2004, Kiran Mazumdar-Shaw


(Kiran), the Chairperson and Managing Director
of Biocon India Limited (Biocon) received the
'Businesswoman of the Year Award,' from 'The
Economic Times of India,2' a leading Indian
business daily. This award was to be given to a
person who "was global in nature and would have
shareholders' good uppermost in mind. The person
should have followed her heart and vision
relentlessly, broken all glass ceilings3 and
pioneered the cause of women in business."4 It
symbolized the increasing importance of the role
of women in the Indian business arena. One of the
most successful businesswomen in India, Kiran
had received several awards during her career of
over 25 years (Refer Exhibit I for the list of
awards received by Kiran).

She founded Biocon as an enzyme extraction company in a rented garage in 1978. By 2004, Biocon had emerged as
the #1 biotech company in Asia, and #16 in the world in terms of revenues and market capitalization. The company
made its initial offer of shares to the public in March 2004. The shareholders earned handsome returns on their
investments as the stock, which was offered at Rs 315, touched a high of Rs 780 in early November 2004 (Refer
Exhibit II for the stock price chart of the company). Reportedly, Kiran had to break through the 'glass ceiling' effect
on several occasions being a woman entrepreneur in the traditional Indian society.

She believed that Indian women can do well in


business even if they don't belong to a business
family or have political influence or immense
wealth. Kiran believed that women in India were
not meant for only certain kind of jobs like
teacher, nurse or personal secretary, or for running
a small or cottage industry at the most. She
considered herself a representative of the modern
women who could work shoulder-to-shoulder
alongside men and build mega businesses.
Expressing a deep desire for equality, she said in
her award acceptance speech, "I do hope that in
the not-too-distant future, there will be one award
for men and women alike - the Businessperson of
the Year Award."5

The Entrepreneur

Kiran was born and brought up in Bangalore in


the state of Karnataka, India. She hailed from a
middle-class family, which encouraged her to
pursue higher education. Following the footsteps
of her father, who was chief brewmaster6 in
United Breweries7, she went to Ballarat College in
Melbourne, Australia, to specialize in Malting and
Brewing Technology to become India's first
woman brewmaster. Kiran came back to India in
1975 expecting to get lucrative job offers.
However, she did not receive any. Though she
possessed the required technical qualifications,
her chosen profession was completely male-
dominated one8. After staying for two years as a
consultant in India, Kiran went abroad and found
a job in the UK.

There she met Leslie Auchincloss (Auchincloss), the owner of Biocon Biochemicals Limited, an Ireland-based
company. Auchincloss was planning to start a business in India. The Irish company wanted to establish its operations
in India to produce simple bio-products from indigenous raw materials. 

The Growth of Biocon

Biocon started with the manufacture and export of


Papain, a plant enzyme, and Isinglass, a marine
hydrocolloid,11 which are key products for the
brewing industry. Within two years, Biocon
established a steady flow of exports to Ireland. As
the offtake of the company's products by Ireland
grew, Biocon's manufacturing activity was shifted
from the rented garage to a 20-acre site near
Bangalore city in 1983. Kiran was not content
with the steady growth in the product offtake by
the Irish company. In 1984, she decided to recruit
a team to commence research and development
(R&D) in new areas of enzyme technology.
Biocon emerged as the #1 biotech company in
Asia and #16 in the world in terms of its fiscal
2003-04 revenues. For the fiscal year 2003-04, the
company recorded net revenues of Rs 5018.824
mn, almost twice the previous year's figure, and a
net profit of Rs 1246.726 mn. (Refer Exhibit III
for the financial performance of the company). In
the past 25 years, the company had evolved from
a maker of enzymes to a major pharmaceutical
enterprise, producing everything from insulin19 to
antibodies20 (Refer Exhibit IV for the Biocon's
achievements). On March 11, 2004, the company
launched its initial public offer (IPO) of 10
million equity shares of Rs 5 face value at a price
band of Rs 270-315. With this, Biocon became the
first biotech company in India to go public.

The IPO was oversubscribed by 33 times, indicating the confidence of investors in Biocon. In December 2004,
Biocon's average market capitalization between April 01, 2004 and September 30, 2004 stood at Rs 54 bn...

Looking Ahead

Without resting on her past laurels, Kiran has


moved onto even more challenging ventures of
developing insulin and drugs that can cure cancer.
With 120 mn diabetic patients worldwide and 30
mn in India, diabetes had emerged as an important
area for disease research. Biocon, through its
subsidiary - Clinigene, embarked on a
longitudinal research program in Type II
diabetes.24 In the later half of 2004, Biocon
launched recombinant human insulin under the
brand name 'Insugen.' The product pitted Biocon
against leading multinationals like Eli Lilly25 who
had already lowered prices...

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