THE 170-kilometre road trip from Mumbai to Pune presents a rich slice of Indian life. The traffic-choked route out of Mumbai passes through mile after mile of slums where people’s lives spill out onto the street – they shower, cook and eat within a metre of the car window. The jams ease through the sister city of New Mumbai, a modern metropolis of skyscrapers, parks and shopping centres. Then we drive onto an Indian rarity, a six-lane motorway, running all the way to Pune. But there is still no doubting where I am: “No bullock carts,” proclaims a sign by the roadside.
The reason for my journey is to visit the research headquarters of pharmaceutical company Lupin, set amid fields and hills outside Pune. India’s drugs industry is undergoing a revolution. For decades it has flourished under the country’s unusual patent laws, under which patents can be taken out on the processes needed to make medicines, but not on the drugs themselves. So the industry prospered by inventing new methods of manufacturing the west’s blockbuster drugs, and churning out cheap “generic” versions for sale in India and other developing countries.
In the process, India has developed worldbeating expertise in chemistry and spawned an estimated 9000 drug firms. The country is also the world’s top supplier of “legitimate” generic drugs – copies of medicines whose patents have expired.
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But on 1 January 2005 internationally recognised patent rules came into force that mean the industry must phase out production of generics that are still under patent. Firms such as Lupin are responding to this loss of income by reinventing themselves as global drug-discovery companies. In other words they are emulating the very same western companies on which they once fed.
At Lupin’s HQ, a sprawling research park set amid well-tended gardens, Nilesh Gupta, the firm’s executive vice-president, takes me through Lupin’s future strategy. The company has chosen to focus on three diseases: TB, psoriasis and migraine (see “Seeds of success”). Gupta is on a high, having recently got the go-ahead to begin trials on the firm’s TB and psoriasis drugs. “That’s a pretty huge achievement,” he says.
Other companies have different priorities. Mumbai-based Glenmark is concentrating on diabetes, obesity and lung diseases such as asthma – illnesses that require long-term medication, and are growing problems in India as well as the west. “They are profitable areas to move into,” says Swaroop Kumar, the firm’s senior vice-president of biological research. Wockhardt, also based in Mumbai, has set its sights on infectious diseases. Bacterial drug resistance is soaring, points out Mahesh Patel, the company’s director of infectious diseases research, yet western firms are moving out of the field and there are few new drugs in development. “The international pipeline is running low,” he says. Another advantage of targeting this area is that unlike drugs to treat chronic conditions such as asthma, antibiotics are usually taken only for short periods, so their clinical trials take less time to carry out.
Not all Indian firms are so narrowly focused, however. Nicholas Piramal has recently built a new $20 million R&D centre in Mumbai to carry out basic research in a wide range of disorders, including cancer, diabetes, inflammation and infectious diseases.
The primary goal of all these companies is to replicate what western firms have been doing for decades, but faster and cheaper. Nicholas Piramal recently claimed that it would bring a medicine to market on a budget of $50 million. To put that in perspective, western firms reckon the bill for launching a new drug is not far off $1 billion. How can Nicholas Piramal hope to meet such an ambitious target? As a place to do research, India does have certain advantages. Most notably labour costs are much lower. “A freshly minted PhD in India costs $10,000 a year, as opposed to $50,000 to $60,000 a year in the US,” says Ajit Dangi, director-general of the Organisation of Pharmaceutical Producers of India.
Knowledge of how western companies and markets operate is also valued, and many firms are recruiting Indian-born scientists who have spent time in the US or Europe. Although their salaries generally drop on coming home, they end up comparatively better off because of the lower cost of living in India. One such returnee is Nicholas Piramal’s new chief scientific officer, Somesh Sharma, who spent the past 35 years in the US where he founded several successful biotech firms. Sharma says that when he arrived back in India one of the biggest culture shocks was people’s observance of hierarchy. He recalls the surprise of “everybody standing up as soon as I walk into the room, everybody saying ‘sir’ and ‘doctor’.”
Indian drug companies also find it easier to recruit people for clinical trials. For example, when Sharma last ran a study in Europe of a potential new diabetes drug it took a year to find 100 patients. Recruiting that number in India took him only 30 days. It is not just that India has a vast population but also drug companies are not competing so fiercely for patients as they are in the west. In addition, Indians are less likely to be taking other medicines that could interact with the test compound. “It’s easier to look at a new drug on a treatment-naive patient rather than on someone who has taken every drug under the sun,” Sharma says. But that does not mean companies target poorer people for their trials. They make less than ideal experimental subjects, he says, because they may be undernourished and are less likely to turn up for all their hospital appointments.
It’s for reasons like these that many western firms, such as AstraZeneca, have opened large research centres in India or set up major collaborations with local firms – the Danish-based multinational Novo Nordisk with the Indian Dr Reddy’s, for example.
“The biggest challenge for the embryonic drug discovery industry is the risky nature of pharmaceutical research”
Although India has its advantages, it also presents some unique challenges. Roads and water supply are often poor and in many places power cuts are common. Within the industry itself there is acceptance that corruption and excessive bureaucracy are part of the system. Then there is the lethargic approach to getting things done. Sharma says that if he needed to order a reagent in the US he could call at six in the evening and receive it next morning. “In India, it can take three weeks,” he says. “There is a lot of inertia.”
Another stumbling block is that a strong animal-rights movement, together with complex and confusing laws, have virtually stopped research on large animals such as dogs and primates. Most firms now outsource large-animal work to Europe or the US.
But perhaps the biggest challenge for the embryonic drug discovery industry is the intrinsically risky nature of pharmaceutical R&D. Western drug firms have found to their cost that only 1 in 10 compounds that make it to clinical trials ever reach the market.
One company aware of this pitfall is Dr Reddy’s, based in Hyderabad. Development on two of its lead compounds for diabetes has recently been suspended. It transpired that one, called balaglitazone, had little benefit over medicines already available. The other, called ragaglitazar, was the first in its class, and human trials showed it benefited both patients’ blood sugar and cholesterol levels. But studies revealed that it caused cancers in rodents.
Undaunted, company founder Anji Reddy, points out that his was the first Indian firm to set up its own R&D programme more than a decade ago. “In 1993 when I was the president of the Indian Pharmaceutical Congress I said very clearly that companies have to get into drug discovery. And why not? We have the talent pool.” Dr Reddy’s has eight new compounds ready for clinical trials, he says, and is on course to produce another three a year for the next three years. So, according to the 1-in-10 statistic, at least one, and perhaps two of those compounds could hit the jackpot.
India’s fledgling drug discovery industry will undoubtedly produce both winners and losers, but at the moment all bets are off. The next few years are likely to see a spate of mergers and take-overs that could restructure the 9000 existing companies into as few as 500.
One thing is certain: for drug companies in India, standing still is not an option. “Unless they change their business model from imitation to innovation they will not survive,” says Dangi. “The free lunch is now over.”
Read more about India in our special report
A matter of life and death
WESTERN drug companies have developed the medicines that have transformed HIV infection from a death sentence to a chronic but treatable condition. But it is Indian pharmaceutical firms that have led the fight against AIDS in Africa.
Thanks to India’s patent laws, which have allowed its firms to produce cheap “generic” versions of HIV drugs that are still under patent in the industrialised world, the cost of life-saving therapy has been slashed from $10,000 a year to less than $200. While that sum is still beyond the reach of most Africans, it vastly expands the number of people who can be treated using international aid money.
Fortunately existing HIV medicines will not be greatly hit by India’s recent adoption of global intellectual property laws as the new rules only apply to products patented since 1995. And that excludes most HIV drugs.
Nevertheless, US drug firms are using all available means to stop aid money being spent on what they claim are pirated drugs. Last year they successfully lobbied the World 91ɫƬ Organization to impose extra safety checks on generics. The US government also refuses to spend its aid money on drugs that have not been approved by the American drug regulatory agency, the Food and Drug Administration. So far only one generic HIV drug from outside the US – made by a South African firm – has met this requirement.
Two Indian companies have recently had to withdraw products from the WHO’s “approved” list because they lacked the necessary paperwork. One company, Cipla, carried out new studies that met the WHO’s requirements and got the drugs relisted last November. The other, Ranbaxy, aims to resubmit new data for most of its drugs by March. Several aid agencies have continued buying the delisted drugs, however, because they simply cannot afford the costlier brand-name versions.
With the WHO redoubling its efforts to channel more aid money into HIV treatment, the battle may not yet be over. The organisation has set a target of getting 3 million people in the developing world on anti-HIV medicines by the end of this year. “WHO has the companies in the US looking over its shoulder for weaknesses,” says Daniel Berman of Médecins sans Frontières.
Seeds of success
HERBAL therapies are a big part of India’s traditional ayurvedic system of medicine. While most of them have not been tested scientifically, some Indian firms are using them as a starting point for drug discovery.
Nicholas Piramal, for example, owns a library of 5000 botanical samples together with information from ayurvedic texts on which illnesses they are used to treat. Plant extracts are tested for activity against numerous different cell and tissue types, starting with those that seem most relevant to their traditional use. “If you look at ayurvedic text, you can get wonderful leads from that,” says H.S. Parikh, the company’s vice-president of clinical research.
When a useful plant chemical is found, its molecular structure can be tweaked to improve its effectiveness, for example by making it bind more tightly to the target molecule in human cells. This step has another important advantage. “You need to modify it so you can patent it,” Parikh says.
Lupin also has a rich plant library. The firm is developing a herbal psoriasis medicine for the Indian market. But it has also isolated the plant’s active ingredient, which it calls desoside-P, and is developing that for the international market. The compound seems to work by raising levels of interleukin-10 in the skin – this biological signalling chemical is known to alleviate psoriasis flare-ups.
Desoside-P could also have potential against other autoimmune diseases, perhaps including rheumatoid arthritis, says Nilesh Gupta, the firm’s executive vice-president. “If it works in one,” he says, “the chances are it should be tested in others.”
