Indian drugmakers have a potent cure for the present ills dogging the industry: Research. Often pulled up for spending too little on research and development (R&D), India’s biggest pharmaceutical companies now appear to match their global peers in investing for the future. The country’s five top drugmakers together spent a record Rs 8,025 crore in R&D in FY17, data from Bloomberg show.
Glenmark Pharma, one of the earliest and among the very few local drugmakers to take up innovative research, spends 12% of its revenues on R&D. At more than Rs 1,300 crore, its absolute spend on research has more than doubled in the past five years. The company has a pipeline of seven new molecular entities in the areas of oncology, respiratory and dermatology, and three specialty products targeting respiratory indications. “Over the next five years, we will see a lot of transit as companies are forced to do things they have not pursued earlier – invest in R&D, brand and market their products in the US,” says the head of strategy at a leading pharma company. While the companies do not share details on the split in expenditure between specialty and generic R&D, industry experts estimate that 90% of incremental R&D spend is being made in the specialty portfolio comprising of complex generics, specialty drugs, and biosimilars.
“We've started investing in specialty R&D almost four years ago. And now are likely to spend even more significantly”, said Dilip Shanghvi, managing director of Sun Pharma, at the company’s earnings call. Sun Pharma has a strong pipeline for the US market, with 157 ANDAs and 5 NDAs awaiting approval with the US FDA.
According to Sailesh Bhan, deputy CIO, Reliance Mutual Fund, large companies like Sun Pharma, Lupin and DRL investing Rs 2000 crore each on research augurs well for their growth prospects in terms of building product pipeline and forays into niche areas in the US.
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(Courtesy: BY KIRAN KABTTA SOMVANSHI, The Economic Times)