Obesity drugs may spur licensing, distribution deals for Indian drugmakers after patent expires
The rising demand for obesity drugs is prompting Indian pharma firms to pursue licensing and distribution partnerships, particularly for GLP-1 drugs. Major deals have been signed, with analysts predicting continued growth in the market as patents expire and supply chain collaborations emerge.
The growing popularity of obesity drugs is expected to spur Indian pharma companies to sign licensing partnerships and distribution deals as they eye the lucrative segment. Indian companies started signing big-ticket deals with innovators for novel GLP-1s, as well as generic versions, last year. This trend is likely to continue this year as the market opens up with the expiry of semaglutide’s patent, according to experts.
Given the complex regulatory pathway and manufacturing required for a GLP-1 pen, which involves manufacturing the compound, the pen and the fill-finish (filling the pen with the formulated drug), analysts said companies may tie up with others to bolster their supply chain and grab a larger share of the market.
GLP-1s (glucagon-like peptide-1s) are a class of drugs used to treat type-2 diabetes and obesity, which mimic the body’s GLP-1 hormone to control appetite and regulate insulin.
Lupin announced a license, supply and distribution agreement with Chinese firm Gan & Lee Pharmaceuticals for Bofanglutide, a novel GLP-1 drug to be taken fortnightly, which is currently under development. Lupin will have exclusive rights to commercialize and distribute Bofanglutide in India, the company said on 29 December.
Ajanta Pharma inked a deal with Biocon on 23 December to distribute generic semaglutide (popularly known by its brand names Ozempic and Wegovy) in 26 African and Asian countries once the drug’s patent expires in these markets this year. Ajanta Pharma is also considering a separate partnership for the domestic market, managing director Yogesh Agrawal told Mint in an interview.
In November, Emcure Pharmaceuticals tied up with innovator Novo Nordisk for an exclusive distribution partnership for semaglutide under a new brand name—Poviztra. Cipla signed a deal with rival innovator Eli Lilly for its weight-loss drug tirzepatide (Mounjaro). In both cases, the aim was to expand access to the drugs leveraging the strong front-end presence of the domestic companies.
Distribution presence
“We will see these [partnerships] happening across markets," said Vishal Manchanda, a pharma analyst at Systematix Group. Companies with a strong distribution presence might tie up with leading manufacturing players, said Manchanda, adding that there may be more exclusive licensing deals in overseas markets, while manufacturers could likely tie up with more than one distributor in the domestic market.
The number of deals for a specific sub-segment is unprecedented.
“Historically, other diabetes products have also lost patents. Sitagliptin was the first meaningful diabetes drug to lose patent, followed by Dapagliflozin, and others… But there was no such deal-making around those patent expiries… This is probably because the supply chain is complex here" said Manchanda.
The market for GLP-1s in India has already crossed ₹1,000 crore in less than a year after innovator companies started selling Mounjaro and Wegovy in the country. The market is expected to grow 10-fold in the next two to three years, according to analysts.
A key reason for the rapid increase expected is the loss of patent exclusivity for Novo Nordisk’s blockbuster drug Wegovy in several countries this year, including India in March. Globally, the GLP-1 market is expected to be worth $95 billion by 2030, according to Goldman Sachs.
“…because it is a humongous population, not only in India but across multiple markets, the distribution is going to be very tough. And therefore, companies that have local distribution/marketing presence will get a preference in those local market," Shrikant Akolkar, a pharma analyst at Nuvama, told Mint. “As we come closer to the date, which is in March 2026 (for India), when the product goes off patent, I think we may expect some more deals."
Differentiated products
While domestic drugmakers might partner up for generic semaglutide in India and overseas (Mint reported in October how contract manufacturers are increasing capacity), experts also expect more deals with innovators, such as Lupin’s recent deal.
“The entire goal would be to get a product which is differentiated," said Manchanda. The drug that Lupin has licensed is a fortnightly use, instead of once a week.
Apart from the manufacturing complexity, which not many Indian players have in place, getting regulatory approval for the drug is a challenge. Several Indian companies have applied for regulatory approval, but only three—Dr Reddy’s Laboratories, Sun Pharmaceutical Industries and Alkem Laboratories—have received it so far, said analysts.
“Everybody wants to try it out, but the larger ones are probably better poised. Obviously, because of the reach as well as because credibility is very important for this product," Manchanda said.
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