24830 - Ocimum Bio

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Environmental Review Summary

Project Number

24830

Company Name

OCIMUM BIOSOLUTIONS LTD

Date ERS Disclosed

Mar 7, 2006

Country

India

Region

South Asia

Environmental Category

B - Limited

Status

Completed

Previous Events

Approved : Nov 1, 2006
Signed : Nov 3, 2006
Invested : Nov 8, 2006

Sector

Other Medical

Industry

other

Department

Regional Industry - MAS Asia & Pac

Project Description

Ocimum Biosolutions Ltd. (the company) is a small sized, fast growing firm that provides contract research outsourcing (CRO) services to pharmaceutical and biotechnology companies and research organizations globally. Research outsourcing can help reduce the financial risk for large companies by lowering their capital investments (in research staff and lab infrastructure), and converting their fixed costs into variable costs.

Ocimum, with India as its base and subsidiaries in the US and Germany, recently acquired the Genomic Diagnosis Division of MWG Biotech AG, Germany (MWG) and integrated it into its Indian operations. Ocimum offers services to universities, research centers, various labs and pharmaceutical companies including basic human disease research, genetic analysis, pharmaceutical drug discovery and development, pharmacogenomics, toxicogenomics and clinical diagnostics.

These services are categorized as Bio-IT:

Bio-IT provides ready to use reliable, cost-effective software solutions for the biotech/pharma industry with products that enable data mining, algorithm development, gene identification, etc. Ocimum currently offers seven bio-IT software products which include LIMS and Bioinformatics products:

- Microarrays: The company acquired the expertise and production facilities recently from MWG Biotech. Ocimum sells microarray products and services for academic, industrial and diagnostic research.
- Oligonucleotides: As a further move to consolidate its position in genomics CRO, the company is in the process of acquiring the oligonucleotide (oligo) synthesis division in Europe. The company intends to synthesize oligos both for captive consumption linked to its CRO services, and for sales to other customers.
- Contract Research: Ocimum provides PCR and genomic services to a variety of clients.

Environmental and Social

The sponsor has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow.

- Minimization of organic solvent usage:

The company utilizes small amounts of solvents, reagents and other chemicals in its laboratories. The company will provide appropriate storage containers for all hazardous materials at both existing facilities and any new facilities acquired in future. In addition, the company will make personal protective equipment (PPE) such as gloves and safety glasses available to laboratory employees in accordance with safety procedures recommended in the Material Safety Data Sheets (MSDSs) for chemicals in use. Ocimum will ensure that all relevant MSDSs are available on site, along with washing stations and necessary antidotes, in the event of accidental exposure.

- Minimization of animal experiments:

Ocimum does not conduct any experimentation using animals, animal tissues or pathogens at any of its facilities in India, the US or Germany, nor does its work involve the use of animal tissues. Ocimum is not presently engaged in clinical trials and will not undertake such activities in the foreseeable future. Some pharmaceutical firms may, from time to time, outsource some lab tests to Ocimum that could be linked to clinical trials. However, in such cases, Ocimum''s tests will be performed only on molecules and will consist only of required statistical analyses.

- Wastewater treatment and discharge:

The company operates its offices and laboratories in India out of leased office space in Hyderabad. The laboratory utilizes reverse osmosis (RO) technology to purify the water, which produces small amounts of waste water. In addition, small amounts of dilute reagents and solvents are generated. Both of these are currently discharged to the Hyderabad municipal sewerage system. At IFC’s request, the company will confirm that this disposal method conforms to international best practice, as well as Government of India (GoI) requirements, for each of the dilute chemicals in question. If indicated, the Company will containerize the waste solvents/reagents and periodically dispose of these at an authorized hazardous waste facility, in accordance with GoI legislation and best international practice. As and when Ocimum constructs its own facility in future, it will obtain all relevant Pollution Control Board authorizations for the use and disposal of waste water, solid waste and regulated hazardous wastes.

- Air emissions:

As noted, the company operates out of leased office space, where its operations consist primarily of computer programming activities and a small amount of laboratory activity. As a result there are no significant air emissions at these facilities.

- olid and hazardous waste disposal:

Solid wastes at the Hyderabad facility are minimal, comprising of office waste and small amounts of laboratory waste. Although none of the laboratory wastes (cDNA, RNA and oligonucleotides) are regulated as biohazards, the company has nonetheless adopted a policy of autoclaving all wastes from the laboratory before they are disposed in a municipal landfill.

- Hazardous materials management:

As noted above, the small amounts of Ocimum’s microarray activities involve cDNA, RNA and oligonucleotides, none of which is considered a biohazard requiring special handling, storage or disposal. The small amounts of solvents, reagents and other chemicals used in the laboratory are stored and handled in accordance with GoI requirements and international best practice, as discussed above.

- Occupational health and safety programs:

Ocimum employs a total of 110 people in India, 8 people in the US, and 3 in Germany. Employees in all of these locations are either computer programmers/analysts, laboratory scientists or sales and administrative personnel. The company offers competitive salaries and benefits and complies with all relevant personnel and occupational health and safety regulations in the countries in which it operates. As discussed above, the company will make PPE such as gloves and safety glasses available to laboratory employees in accordance with safety procedures recommended in the Material Safety Data Sheets (MSDSs) for chemicals in use. Ocimum will ensure that all laboratory staff are trained in safe handling, storage and disposal of all materials in use at its facilities.

- Reputational issues:

Ocimum does not take part in clinical trials, nor is it in the business of creating genetically modified (GM) organisms. The company processes GMO samples in its laboratory in India, as part of its safety testing for clients. If this situation were to change in future, the Company will notify IFC of its intent to take part in clinical trails and/or use of GM organisms at least 60 days prior to doing so.

- Community relationship/development:

As noted, Ocimum employs a total of 110 people in India, 8 people in the US and 3 in Germany. As all of its facilities are located in urban or peri-urban areas, it has not established a community engagement effort with a specific host community although it has participated with a few organizations like the Naandi foundation. Ocimum Biosolutions is planning on undertaking taking up a program on corporate social responsibility activities including offering biotech training to underprivileged children, working with other organizations to help in education and on women empowerment.

Conclusion & Monitoring

IFC will evaluate the project’s compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing the annual monitoring reports (AMRs) prepared for the project covering:

- the status of implementation of any measures contained in the Environmental and Social Action Plans and

- ongoing performance of project-specific environmental, health and safety and social activities as reflected in the results of periodic and quantitative sampling and measuring programs.

Periodic site supervision visits will also be conducted.

This Environmental Review Summary (ERS) is prepared and distributed 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 of Director’s decision. Any documentation that is attached to this ERS has been prepared by the project sponsor or in conjunction with the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content. The following ERS is disclosed in accordance with IFC's Disclosure of Information Policy that went into effect September 1998.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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