The business alliance between German drug maker Boehringer Ingelheim GmbH and US biotechnology firm Eli Lilly and Co. focusing on the growing diabetes market is likely to set a new trend in the highly competitive local drug market, where foreign drug makers are aggressively taking on entrenched generic rivals.
The global collaboration combining the portfolio of the two to address a particular disease segment and selling the products through a common team in various markets is the first such alliance in the drug industry.
The Boehringer-Lilly alliance, which is expected to manage at least four high-specialty products in the first two to three years, introduced its first new diabetes drug—Trajenta tablets developed by Boehringer—on Thursday in the Indian market.
The companies had in October signed the business alliance as part of a global strategy to address the diabetes market by combining injectable drugs, including insulin, developed by Lilly and Boehringer’s oral diabetes drugs. It had already introduced an insulin—Humlog from Lilly—in the local market soon after signing the alliance.
Under the model, the partners can keep adding products as well as people to the alliance, while retaining their core competence in research and manufacturing. Existing collaborations and co-marketing alliances currently combine product capabilities of one side and marketing and distribution capabilities of the other. In some alliances, the partners individually promote and sell common products.
“This is a unique model, which actually goes a step ahead of the existing partnership strategies in the pharmacy industry,” said Muralidharan Nair, partner, life sciences, at consultant Ernst and Young.
Nair said the industry will keenly watch the model’s performance and it could emerge as a new trend, where disease management is currently the core business strategy.
A rival drug maker said the model may work successfully in the local market, with several chronic ailments including cancer, heart and respiratory diseases becoming a key focus for both local and foreign drug makers. “It is an interesting model, which many would replicate in the competitive sector as part of market specialization,” said a senior executive at a top India drug maker. This executive, who didn’t want to be identified, said his “company, which is specializing in oncology and cardiac therapy, may look at such an alliances with a couple of competitors in the local market as part of strengthening the segment focus.”
Sharad Tyagi, managing director, Boehringer Ingelheim India, said the “alliance in India now offers oral anti-diabetics as well as contemporary injectable insulins. These offer a choice to the doctor in deciding the optimum therapy, depending on the patient’s needs, and it combines the strengths of two of the world’s leading pharmaceutical companies.”
While the combined field force provides sales breadth across the country, the new launch provides more choice to the clinician, he added.
“The alliance will continue to focus on bringing to India innovative products and services to address unmet patients needs amid the growing Indian diabetes epidemic,” Melt van der Spuy, managing director, Eli Lilly India, said on Thursday in a phone interview.
ch.unnikrishnan@livemint.com
