Patience vs politics?

In clinical settings, perlecan is a large multi-domain proteoglycan, a core protein of cell surfaces, whose levels are closely tracked in diabetes, arthritis and atherosclerosis. That's probably why Dr Anji Reddy, founder of Dr Reddy's Laboratories (DRL), chose to name the de-merged entity into which he transferred four of DRL's new molecules targeted at these diseases, as 'Perlecan Pharma'. Three years down the line, one molecule has been abandoned, and the buzz is that the remaining three have not shown as good results as expected. The venture capitalists (VCs) who funded the venture, ICICI Venture and Citigroup Venture Capital, have decided to cut their losses and move on. DRL will buy back their equity stakes and go forward alone. While the DRL remains committed to discovery research and the molecules, the development is being seen as a setback to the Indian pharmaceutical industry's efforts to join the ranks of the innovators. However, three years is too short a time horizon to judge the worth of a drug discovery pipeline. And it is a well known fact that there are many misses in the R&D sweepstakes before a company scores a hit.

That said, is it going to get tougher to convince VCs to bet on Indian pharma, or for that matter, Indian biotechnology companies? What will be the fate of other R&D hive offs like Sun Pharmaceuticals' R&D centre, SPARC (Sun Pharmaceuticals Advanced Research Centre) and Piramal Life Sciences, the R&D arm of Piramal Healthcare? The latter is known to be searching for a strategic partner to take on minority stakes. Coming soon after Ranbaxy's latest run in with the US Department of Justice, throwing suspicion on one of its US FDA manufacturing facilities, industry observers are worried that the image of the country will suffer. Are US pharma industry lobbyists working overtime, making an example of Ranbaxy to rein in the rest of Indian pharma, especially with US elections due in the next few months, and healthcare being a top issue with voters? Obviously, the lobby opposing affordable generics is afraid they will be further ‘Bangalored’ by Indian pharma. Hopefully, these setbacks will make Indian pharma companies more stringent with their own internal checks. On the R&D front, this may turn out to be one of the darkest moments before a new dawn.

Viveka Roychowdhury
viveka.r@expressindia.com