Lessons to Learn

Last week Dr Reddy’s research compound DRF 4158 licensed to Novartis was shown the red light and all further development on this molecule has come to a stand still until further review on either side. This comes close on the heels of the earlier set back of Novo Nordisk suspending phase III studies of Dr Reddy’s DRF 2725, a new generation dual acting PPAR compound. While no reason has been announced at this stage by both the companies in this collaboration for stopping development of DRF 4158, research agreements normally have clauses for substituting the next best compound to replace the lead compound immediately or after further screenings, so that the licensing deal is kept alive for the search of an as yet elusive but potential compound in that series. Both DRF 4158 and DRF 2725 must have been the most promising ones in their class and therefore targeted as leads. But, set backs in research which are not uncommon, are seen by media and stock markets in a different perspective. Companies that tout compounds as promising and wish to ride on its initial euphoria will have to reckon with the peaks and troughs along its developmental path. Normally, discretion is the better part of valour in NCE research, but it is not always possible to keep good news under wraps for too long. At the same time, mature companies do not go about painting the town red with such expectant good news. A match is not won until the last ball is bowled. Indian companies on the NCE trail for prospective licensing deals should keep this in mind. It pays to keep a low profile and not interact too often with analysts despite compulsions to do so.

In Dr Reddy’s case, while Novo Nordisk suspended their compound at phase III stage, Novartis has done so at the stage of animal studies itself. This could be seen as a cautionary approach by Novartis not wanting to commit resources at clinical level until things are clear. Both the DRL compounds coming from the same stable could have similar findings and as assessment of DRF 2725 as regards cancerous tumours in rats is yet to be completed, a temporary set back for DRF 4158 could not have been ruled out. The entire gamut of pre-clinical work referred to by some research companies as ‘‘zone of chaos’’ is indeed unpredictable. This is another lesson Indian companies on the research bandwagon will have to personally experience - the thorough churnings of pre-clinical screenings - the agony and ecstacy of validations in right animal models, extensive drug metabolism studies and complete safety assessment profiles. If DRL is the first Indian company to go through these litmus tests, others will also have to pay a price for acquiring such experiences - compounds necessarily falling by the wayside before one of them sees light at the end of the tunnel. But after a couple of years Indian research outfits will have to acquire preclinical expertise to cut losses, time and leverage collaborations advantageously. Negative news for DRL’s tie-ups could be a temporary dampener but the jury is still not out on this new class of diabetic compounds.