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Bengaluru: Aurigene Discovery Technologies Ltd, the biotech research arm of Dr. Reddy’s Laboratories Ltd, wants to move beyond relying on partners and licensees to bring its drugs to market.

Breaking with tradition, the company is working on developing its own anti-infective—a drug that can destroy an infectious agent or prevent it from spreading—and is looking for ways to commercialize it on its own.

The company plans to bring more of its compounds to the market, deviating from its normal practice of depending only on out-licensing deals and partnerships with companies such as Novartis AG, Sanofi SA and Orion Pharma Ltd.

It is a “brave statement to make" but only natural because “all companies in our business hope to (eventually) commercialize" their own compounds, Aurigene chief executive C.S.N. Murthy said.

Indian pharma and biotech companies typically prefer licensing deals so as to reduce risks and costs involved in developing new drugs.

However, in recent years, some have sought to go the distance. Among others, Cadila Healthcare Ltd is working on a small-molecule new chemical entity (NCE) to act as an anti-diabetic. Glenmark Pharmaceuticals Ltd has one NCE in the clinical stage.

“Research is a fairly risky proposition and also time-consuming as it has to go through discovery, development and marketing. India is not bereft of research and in the last two to three years, activity in this space has been increasing and is promising too," said Utkarsh Palnitkar, partner & national head, advisory and life sciences practice, KPMG India.

“Promising research is also done by entrepreneur-scientists in companies such as Connexious Lifesciences Pvt. Ltd in Bengaluru and Curadev Pharma Pvt. Ltd in Delhi," said Palnitkar.

According to Murthy, Aurigene is looking to bring one compound to the market for starters.

The company has zeroed in on four compounds to make anti-infective drugs, one of which it hopes it can take to the clinical trial stage this year and commercialize in a few years.

It currently has 15 research programmes—11 in oncology, the branch of medicine that deals with tumours, and the rest in anti-inflamatory and anti-infectives. “Of these, two will enter clinical trials before the end of 2015-16; with luck it could be three. There could be two to three more in the next year," said Murthy

For most of these, Aurigene will follow the time-honoured practice of out-licensing.

“We will also look at out-licensing some of these programmes in the Phase 1b (early stage) or 2a (mid stage) of clinical trials," he added. But it will try and bring its anti-infectives to market by itself. The outcomes are more direct and cost of trials lower, Murthy said.

Last year, the company earned revenue of around 250 crore from collaborations and out-licensing deals. It expects the same amount in revenue this year. Aurigene expects its revenue to rise significantly after next year, as one of the compounds, a cancer drug that has been licensed out to a large pharma firm, has reached late-stage trials.

That apart, the out-licensing of a couple of compounds in early-stage trials could fetch the company $25-50 million upfront each. “Most of the revenues for the companies come from out-licensing deals," Murthy said.

But Aurigene realizes the importance of doing its own thing too.

The company has invested around 120 crore in research and plans to increase this. “This amount could go up three to four times, now that we plan to focus on internal programmes," Murthy said.

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