Indian pharma's capabilities in new drug research and development (R&D) can well be assessed from the strides it has made on this front within a short span of time. Now the global pharma is eagerly looking at India's R&D efforts, as Big Pharma's innovative R&D pipelines are getting almost dry. Can India emerge as innovators in drug industry, at a time the industry is facing innovation deficit? In an interview with Anil Mathew, Glenn Saldanha, chief executive officer and managing director of Glenmark Pharmaceuticals Ltd, provided vibrant answers to this and several other queries. Excerpts from the interview:

Though much has been said about India becoming a pharma R&D powerhouse, things have not been turned out as expected. What went wrong?
As a country we have exceptional talent in chemistry. This talent needs to be harnessed given a direction and sufficient resources to deliver the goods. When it comes to pharma R&D in terms of innovative drugs, we are behind as a country in terms of infrastructure and resources, as compared to developed nations. We cannot change overnight. The country still needs more time. One can see the government taking steps in that direction. But the government needs to do much more and at a rapid pace. Also, pharma companies must believe that innovation is possible from India and one needs to invest in this area. During the past few years, infrastructure, skill sets and capabilities among the major players in the drug discovery arena have improved significantly. A number of Indian firms are now actively engaged in drug discovery either by way of contract research or research for their own pipelines. Most firms now recognise that New Chemical Entity (NCE) research is growing to be the major driver for industry's growth.

India has ample scientific talent, skills in chemistry, plenty of US FDA approved facilities and over all low cost labour. Then why is that Indian pharma players fail to make it big on R&D front?
The dynamics for generics and innovative drugs are completely different. On the generics front, India has done exceptionally well. Also on that front, R&D has played an important role in bringing down costs, while managing quality. India has already made a mark for itself on the low-cost generics front.

On the innovation front, there are numerous opportunities. However, the dynamics for R&D are completely different. Innovative research has a long gestation period, risks are very high and it's a new area for Indian pharma. Having said it, it's still possible for us to be successful in drug discovery. Glenmark has made substantial progress in this area but we are still on our way. We have managed to take seven molecules to clinics, which is a significant achievement for an Indian company, considering that our NCE research programme is driven out of India. All our molecules are either best in class or first in class. The most recent one to enter clinical trials, GRC 15300, a TRPV3 antagonist, has recently been filed for clinical trials in the UK and that would represent the first molecule in its class to enter clinical trials globally.

What are the major hurdles faced by the Indian pharma cos in taking their R&D activities to completion?
We need to believe in ourselves, if we are to produce innovative drugs. Secondly, the government needs to strongly support innovative research because the cost of innovative research is very high and it is a high risk area. However, the upside potential is huge to companies and also to the patient population. You need to get the right knowledge pool in place within the company by recruiting the brightest and most qualified people you can get. At the same time, you need to keep investing in these people by continually providing them with ongoing learning opportunities. The researchers need to stay on top of the science.

Do you think that Indian pharma cos are capable of breaking the 'innovation deficit' in the industry?
It is possible - if the government gives innovative research strong support, pharma companies invest in innovative research and academic institutions encourage innovative research.

Are the existing regulations supportive in developing India's R&D capabilities?
There is a lot to be done on that front. The government has begun taking a few steps. However it needs to move very fast on this front.

What are the main focus areas of your R&D activities?
Glenmark is the leader in the discovery of new molecules - be it NCEs or biologics - and is focused on the areas of inflammation [asthma/COPD etc], metabolic disorders [diabetes, obesity etc] and dermatology [psoriasis, ruritus, atopic dermatitis]. Currently, we have a robust pipeline of 13 molecules in various stages of preclinical and clinical development. Of these, eight molecules (including crofelemer) will be in clinical trials before the end of this financial year. Glenmark has clearly demonstrated that it has one of the best pipelines in the area of drug discovery. The molecules that are in the clinics are potential blockbusters with potential peak sales opportunity for each molecule being in the range of US $1 to $3 billion. Our new drug discovery research is carried out at our state-of-the-art research centre at Mahape, Navi Mumbai. Besides, our biopharmaceutical research is carried out at our research centre in Switzerland. Glenmark has also invested in a state-of-the-art R&D facility in Oxford, UK in Sep '08. This R&D facility serves as the global centre for clinical development for Glenmark.

What all help do you expect from the Govt. to boost R&D activities in pharma industry?
If India has to develop innovative drugs, then the government will have to look at this area separately. It would need to provide significant breaks for companies investing in high end discovery research. It must be understood that for a failed molecule there are no returns. Hence, the government must actively encourage companies to venture into high-end drug discovery by providing suitable incentives.

Is getting funding easy for you? If not, what are the factors that make it difficult?
That depends on the source of funding a company has. If you look at private equity, for instance, the typical investment time frame is around 3 to 5 years, whereas the typical time to get a new innovative product to market in our industry is more than double that time. There are longer-term capital pools around, such as the high-end venture capitalists, who are probably more comfortable with those longer time-frames that new product development requires. However, these are much smaller in size than other capital pools, so funding new product development remains a major challenge for many companies.

Fortunately at Glenmark we do have a secure, long-term income stream from other product sales to fund our innovation.

How far has the strategy of spin-off helped the company's R&D activities?
At Glenmark, we have separated our business keeping in mind the imminent changes in the industry landscape. This is unlike other Indian pharma companies, which have spun off only their R&D arm and listed it as a subsidiary. At Glenmark, we have separated the business into "specialty" and "generics" with the creation of Glenmark Pharmaceuticals Ltd. and Glenmark Generics Ltd., respectively. For the specialty business, the idea is to transform it into a pure innovative organisation, which will develop innovative products and thus create a truly global organisation. In many ways the progression has already begun and we have already achieved tremendous success. Our focus in this business will continue to build a robust pipeline of both new biological entities (NBEs) and NCEs. Today, we are working on novel therapeutic target areas for chronic diseases.

Given that the productivity of the Big Pharma's R&D pipelines has fallen, do India pharma stand a chance to make it big on R&D front?
In fact, Indian companies have a big opportunity to capitalise, if big pharma R&D pipelines are getting dry. One must understand that innovative research is the lifeline of Big Pharma. As more and more drugs go off-patent, it would be imperative for big pharma to have innovative drugs coming out in the marketplace to make up for revenue lose due to patent expiry. India has the required talent pool and can capitalise on this big opportunity.