Indian Pharma Sector: Evolving to Innovation - Pharmaceutical Technology

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Indian Pharma Sector: Evolving to Innovation

Pharmaceutical Technology

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MNCs are not yet confident in India's Intellectual Property Rights (IPR) and are closely watching unfolding scenarios to see if their investments in R&D are going to be protected. The cost factor is no more the sole attractive attribute, as subsequent studies have proven that only the research component of discovery, which is about 20% of the total cost, may be lower in India while the development component will be the same as elsewhere in the Western world. This is mainly because, as of today, there is no toxicological center in India recognized by the Organization for Economic Cooperation and Development (OECD), and global regulatory authorities can only accept data originated from these centers. There are few preclinical clinical research organizations (CROs) whose facilities are recognized by specific members of OECD countries. Even Indian drug discovery companies have to outsource their regulatory toxicity component outside India. The situation existing today is a result of earlier regulations by the Committee for the Purpose of Control and Supervision of Experiments on Animals (CPCSEA), which is nonscientifically tilted toward animal welfare. The existing preclinical CROs are mainly generating data for submission to the Drug Controller General of India, and even though they are following OECD guidelines, they have not established credentials accepted by regulatory authorities of developed countries. Indian pharmaceutical companies involved in new drug discovery have adopted a model whereby potential drug candidates coming out of their discovery efforts are out-licensed to MNCs for further development. They are therefore compelled to rely on an OECD-recognized preclinical CRO and the US Food and Drug Administration.

As mentioned earlier, the implementation of product patent law has brought about investment in new drug discovery among the most modern Indian pharmaceutical companies. Initially, Ranbaxy and Dr. Reddy were the first companies to initiate discovery programs in the early nineties. They had significant success in terms of out-licensing a couple of molecules to MNCs. Unfortunately, none of these molecules could strike market success due to a variety of reasons. Subsequently, Wockhardt, Zydus-Cadila, Glenmark, Lupin, Orchid, and Torrent have also invested in discovery research to follow an out-licensing strategy. The most noticeable success has so far been achieved by Glenmark, who out-licensed its asthma molecule to Forrest Laboratories in the US and its diabetes molecule to E. Merck.

In addition to the private pharmaceutical companies, there are institutes under the umbrella of the Council of Scientific and Industrial Research (CSIR) and the Indian Council of Medical Research, and government-funded organizations also involved in new drug discovery from natural resources. The Central Drug Research Institute and Lucknow-based CSIR Laboratories are the oldest institutes carrying out plant-based research for the last fifty years. Very few success stories were written, and they were primarily restricted to India. Yet, the significant result of the intensive Indian discovery efforts have made both government-run and privately owned pharmaceutical companies major contributors toward global patent filings, as demonstrated by the 56 patent filings filed between 1995 and 1999, compared with 246 patent fillings during 2000– 2004. However, despite recording more filings, Indian firms still spend a very small percentage on R&D expenditure, with an average of 2% compared with foreign firms' R&D expenses of 18%.

The fact that a major part of pharmaceutical manufacturing in India is for generic products does not truly reflect the innovation as based on R&D investments and patent filings. The R&D expenses encompass all components of development costs, such as preclinical toxicity, formulation development, and clinical trials for generic molecules destined for the Indian market and therefore do not clearly define the cost of discovery or development of new chemical entities.

There have been a growing number of contract research organizations in India in the recent years. There is also a major shift from chemistry-oriented contract research to biological screening-based support and chemistry-based lead optimization. Presently, India is a preferred destination for chemical activities like custom synthesis, contract manufacturing, and clinical research because of a huge heterogeneous and treatment-naEFve patient population coupled with cost efficiency.


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