The US-based Merck & Co has commenced its outsourcing in the area of drug discovery research from India by awarding contracts to some major Indian CROs like Chembiotek Research International, GVK Biosiences, Syngene, and Sanmar Specialty Chemicals.

The Indian CROs are expected to assist Merck in developing new drugs in areas like cardiology, endocrinology, oncology, psychiatry and rheumatology.

Merck may also set up its office in India in the near future. Steven M. Hutchins, director, Outsourcing, Merck & Co., New Jersey said, "We are looking at the option of opening our office in India post 2005. For the time being, we view India as a cost effective yet qualitative destination for doing research to support our drug discovery channel."

According to Hutchins, due to ever increasing R&D costs and lesser number of NCEs coming out over the recent years, multinationals have started looking towards low cost locations like India and China for doing drug research.

"In future, we plan to bring more research assignments into India," said Hutchins.

As per a latest estimate, the cost of developing a new chemical entity, right from the screening stage to launch would cost $ 1.2 billion. The number of NCE pipeline has diminished considerably.

The global drug R&D expenditure is estimated at $ 60 billion, which include $ 21 billion in the area of non-clinical research and $ 39 billion in the area of clinical research.

According to Dr. Shoibal Mukherjee, senior director, medical, Pfizer Ltd, by doing research in India in non-clinical areas like pre-clinical studies, MNCs would be able to save their research cost by one-third. In the area of clinical research, MNCs would save their R&D cost by one-fifth. This makes India, an ideal place to collaborate for drug research, he said.