India's generic drug giants move into R&D

India's successful generic drugmakers are increasingly looking for strategies to enter the research-based drug market. Although the country's leading drug firms do not yet have the resources to research and develop drugs from the drawing board to market, they are looking at partnerships with foreign companies to ensure risk-sharing and the mobilization of sufficient capital for product development.

GV Prasad, chief executive of Dr Reddy's Laboratories, presented his view of the way that India's drugmakers would become more like the "big pharma" of the USA and Europe at the 13th Annual Pharmaceuticals Conference, organized by the Economist Intelligence Unit in London, UK. He noted that several Indian drug firms were engaged in internal R&D programs, including Dr Reddy's, Glenmark Pharmaceuticals, Ranbaxy Laboratories, Cadila Healthcare, Torrent Pharmaceuticals, Sun Pharma, Biocon, Wockhardt and Nicholas Piramal. For now, these efforts consist of licensing or core development projects.

A number of risk-sharing ventures have been signed, where Indian firms perform contract research or clinical data management, often in partnership with major foreign drugmakers. A notable example is the developing relationship between Ranbaxy and UK drug giant GlaxoSmithKline (Marketletter February 12). The strategic alliance was originally signed in 2003, but was expanded last month, providing the Indian drugmaker with more drug development responsibilities. Ranbaxy will now advance leads beyond candidate selection to completion of clinical proof-of-concept. Meanwhile, GSK will conduct further clinical development for each program and take the resulting products through the regulatory approval process to final commercialization. In addition to milestone payments and royalties, Ranbaxy retains joint marketing rights in India.