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Traditionally the Indian pharmaceutical industry comprised of companies specialising in reverse engineering to manufacture and market more affordable versions of patent-protected products. The focus was appropriate for the prevalent patent scenario that recognised process patents.
As 2005 drew near, with it came the growing recognition that India would alter its patent laws to recognise and respect product patents. In parallel, as the domestic market grew more crowded and overseas markets became more accessible but called for a much higher appreciation of patent restrictions on product launch. In the course of understanding this mix of opportunities and threats, some of India's leading companies sighted decided to make investments to leverage India's research strengths to more than reverse engineering patented molecules.
Today, a number of Indian companies, including Glenmark, are building capabilities in original research, targeting new chemical entities [patentable drug options] and novel drug delivery systems. Glenmark recognises that the IPR assets it generates will sustain its revenues and earnings in a post-GATT, product patent regime as well as enable the company to establish its brand name in regulated overseas markets and thereby become a truly global company.
New Chemical Entity [NCE] research has the potential to yield very high rewards. A successful NCE, following the relevant approvals, can be marketed with a 12-to-14-year product exclusivity period during which it can recover its investment a number of times over. However, the overall cost of bringing a new molecule to market, after correcting for the cost of all product failures in the research phase, is approximately between USD 800 million to USD 1 billion. In summary, the high reward comes with the need to take high financial risks. This risk is currently beyond the scope of most Indian pharmaceutical firms.
Glenmark's strategy for its new drug research program has been devised to balance the risk with the reward:
Glenmark's policy is to develop promising lead candidates till early clinical stage and then out-license to international pharmaceutical companies.
In order to increase the likelihood of finding partners, the company has selected and worked on disease areas that are chronic and sunrise sectors.
Within disease areas, Glenmark's approach is to work on validated drug targets i.e. targets where analogue research was feasible.
Glenmark's initiation in drug discovery commenced in 2001 with the commissioning of a state-of-the-art research centre at Mahape, Navi Mumbai [New Bombay]. The discovery team comprises 150 scientists with over 25 post doctorates and PhDs. The Centre is equipped with a range of laboratories with medicinal chemistry, molecular biology, drug metabolism & pharmacokinetics [DMPK] and toxicology capabilities along with a temperature and humidity-controlled animal house that is CGLP-compliant. The company recently set up a 35-bed clinical trial facility at Turbhe.
The company also set up a wholly owned subsidiary in Switzerland in July 2004 called Glenmark Pharmaceuticals S.A. [GSA]. GSA will function as the nerve centre for the group's Intellectual Property related activities and is also building a research laboratory to complement the studies undertaken at the research centre in India.
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