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June 13, 2008

Whither funding for Independent Drug R&D Cos.?

Businessworld has an article examining the implication of the reported pull out by PE firms from their R&D joint venture with Dr. Reddy's Labs, Perlecan Pharma.
“The absence of a dedicated separate management team for standalone research entities like Perlecan may also be partly to blame,” says Nangra. Perlecan remained a paper entity with neither a dedicated management, nor its own office. These are lessons that its followers may not want to repeat.

...The current crisis is not specific to Dr. Reddy’s but may be symptom of larger ills plaguing Indian pharma R&D. Industry insiders point to a whole range of issues affecting the industry such as limited resources — financial and human — and a certain lack of direction in R&D programmes and coordination between scientists and managers.

“Right from the beginning of a new drug’s development, one should know which pharma companies would be likely to in-license it and make the drug attractive,” says Swaroop Kumar, former R&D chief of Mumbai-based Glenmark Pharmaceuticals. “Good science is not enough.”

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports.