MUMBAI, Dec 10, 2006 (AFP) - India's pharmaceutical companies, which amassed fortunes copying generic drugs from the West, are facing up to the challenge of developing their own medicines.
Nicholas Piramal India Ltd (NPIL), the country's fourth-biggest drug company, wants to be the first local laboratory to discover, patent and market original drugs.
"We want to bring a new drug to the market for the treatment against cancer," said Piramal communications director Swati Piramal.
"It would be an affordable drug for India and for the rest of the world," said Swati, wife of Ajay Piramal, founder and chairman of the Mumbai-based group. "This new drug would offer better access to medicines for people at the bottom of the pyramid."
She escorted several journalists round the firm's ultra-modern research centre last week in a suburb of Mumbai, India's economic capital, to publicise the seriousness of their intent.
Some 150 researchers from 22 different countries enjoy the best of scientific equipment at the facility which fully meets Western standards, said Swati Piramal.
Their efforts are focussed on testing 14 promising new products.
However, to date NPIL devotes only 1.7 percent of its 250-million-dollar annual turnover to research and development.
India's top four pharmaceutical firms -- Ranbaxy, Dr Reddy's, Cipla and Nicholas Piramal -- grew strong under the protection of legislation dating back to 1970 which allowed them to skirt round Western patent laws.
The law granted patent rights for a different manufacturing process of an existing drug rather than the discovery of the basic molecule.
For three decades, local laboratories were allowed to produce and sell cheap generic drugs in India and other countries that did not recognise patent rights.
In recent years, Indian pharmaceutical groups have fought numerous court battles over patents against the likes of giants Pfizer, Sanofi-Aventis or Novartis in the United States and Europe.
But in March 2005, parliament passed The Patent (Amendment) Bill to ensure India falls in line with World Trade Organisation (WTO) rules and prevent the copying and sale of low-cost generic drugs, including those used to treat HIV-AIDS.
Faced with their product pipeline drying up, India's pharmaceutical industry -- with annual sales of six billion dollars or just one percent of the global total -- had little choice but to invest in research and development as the new law prohibits them introducing drugs patented post 1995.
Dr Reddy's has taken up the challenge and like NPIL has set its sights on becoming the first Indian outfit to discover and market a new drug throughout the world.
Founder Anji Reddy, who suffers from diabetes, hopes to succeed with a treatment for the illness which afflicts 12 percent of the Indian population.
Research and development is proving a tougher business.
"Making copycat drugs has been a very base business for drugmakers but now they are trying to move up the value chain to sustain their growth on the longterm," said pharmaceutical analyst Saion Mukherjee of BRICS Securities.
"It's a real trend in the market, but so far the success is limited," he said. "It will take time before we see (original Indian) drugs on the market."
The Indian companies, which had become the largest makers of generic drugs worldwide, supported the patent amendment bill.
It aligns the country with WTO rules but also allows them to manufacture generic drugs under license for sale in major markets such as the United States. And it provides intellectual property rights for their own products.
Swati Piramal underlined the changes.
"We won't bust everybody's patent. We decided to follow the rules of intellectual property. We don't want to launch legal battles," she said.
India, which is the world's fourth-largest producer of medicines by volume but only 13th by value, hopes the new patent law will make it a global research base.
More and more multinationals are expected to open up shop to take advantage of the large pool of scientists and low-cost labour.
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