The country’s fourth largest drug maker by sales, Nicholas Piramal India Ltd, after demerging its research and development arm into a separate company earlier in March, plans to induct a strategic partner into the new entity.
The partner, likely a multi-national pharmaceutical company with significant interest in drug discovery, will have at least 10% equity in the research unit, said a senior executive, preferring anonymity.
The research company, which will be known as Piramal Life Sciences Ltd, is valued at about $500 million (Rs2,025 crore) by financial and equity research firms such as Lehman Brothers, Enam Securities Pvt. Ltd and Kotak Securities Ltd.
Nicholas Piramal chairman Ajay Piramal confirmed the development: “We expect a strategic partner to invest in Piramal Life Sciences, which will get listed on leading stock exchanges in June.” The promoters will dilute around 10% in Piramal Life Sciences to the partner, “but it will happen only after the company gets listed on the stock exchanges, because we will have an absolute valuation only then”, he added, declining details.
Mint could not independently ascertain the identity of the potential strategic partner.
Piramal Life Sciences is focused on four therapeutic areas—cancer, diabetes, inflammation and infectious diseases. The company—which has 14 compounds in its research pipeline, including four in clinical trials—has drug discovery and development agreements with leading drug research companies such as Eli Lilly and Co. and Merck and Co. Inc.
The new unit’s valuation is predominantly based on three new drugs under advanced development in the company’s discovery portfolio.
Nicholas has one cancer drug that has almost cleared early-stage, or phase I, trials in Canada and some other international markets. It has two anti-inflammation molecules in advanced development stages.
“All these new molecules are targeted at important disease segments and high value markets. So the success of (even) one molecule will make this entity a billion-dollar company,” said Swati Piramal, director, strategic alliances and communications, Piramal Group.
The company also has five new drugs under development, including two candidates for diabetes and other metabolic disorders. “We will add three more into this advanced pipeline by next year,” she added.
Nicholas, which has launched a new corporate identity in its 20th year of operations in the pharmaceutical sector, proposes to change its name to Piramal Healthcare Ltd with a new corporate logo.
As part of this initiative, its other group companies such as NPIL Laboratories and Diagnostics Pvt. Ltd and Gujarat Glass Ltd are being renamed Piramal Diagnostic Services Pvt. Ltd and Piramal Glass Ltd, respectively.