Businessworld profiles Glenmark's early success with its new experimental drug oglemilast meant to treat asthma and chronic obstructive pulmonary disease.
The deal with Forest Labs is worth $190 million (Rs 836 crore) in all, the largest by any Indian drug maker - including the biggies in the swanky campuses. (The largest before this was the $65-million partnership between Ranbaxy and Bayer for the former's extended release version of Bayer's antibiotic Cipro.) Even the deal with Teijin, worth $53 million (Rs 233 crore), is substantial for a company the size of Glenmark. And a third deal is being negotiated with a European partner.
...While the size of the deal is impressive by itself, the circumstances in which it was struck are more striking. Forest came in even before the drug was tested on humans. For Glenmark, it was the first molecule to be licensed. Yet, the deal dwarfs those struck by bigwigs more than twice Glenmark's size. "Forest must have seen something in that drug," says an analyst.
It's too early to write the oglemilast story - the drug still has some way to go. Forest and Teijin will first take the molecule through human trials on their own. If it clears them, the two firms will have exclusive marketing rights in the US and Japan. Glenmark will earn a royalty on sales and periodic milestone payments during the trials.
There is great risk on this path. One out of every five drugs that enter trials actually reach the market. Even Big Pharma, with billions invested in R&D, has been unable to change that skew. Pharma history is strewn with examples of drugs that failed in trials, or cleared them but were refused marketing rights by the US and Europe regulators. Some drugs from Dr Reddy's and Ranbaxy, too, have suffered that fate.
The article also has a box item on the history of new drug discovery and development efforts at Ranbaxy and Dr. Reddy's.
Arun Natarajan is the Founder of Venture Intelligence India, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of Venture Intelligence India newsletters and reports.