In the spring of 2009, Habil Khorakiwala had almost nothing left to bargain with. Wockhardt Ltd, the pharmaceutical company he had built out of a small Mumbai drug unit—an offshoot of the family’s Akbarallys retail business, which was never supposed to be about chemistry—had reported its first loss a year earlier, a ₹581 crore hole blown open by derivative bets gone wrong. Debt stood near ₹3,800 crore.
The stock, which had traded at ₹419 on the first day of 2008, touched ₹68 in March 2009. Bankers took charge of the finances through a corporate debt restructuring exercise. Khorakiwala stepped back as managing director; his sons Murtaza and Huzaifa were formally appointed to run the company that March.
What followed was a decade of controlled amputation. In August 2009 Khorakiwala sold 10 of his 17 hospitals—the profitable ones, in Delhi and Bengaluru—to Fortis for more than ₹900 crore. The chain had been built with his own money; it was not even part of the listed pharmaceutical company.
Then went the nutrition business, Farex and Protinex, to Danone for around ₹1,280 crore, roughly 25 times its annual operating profit. Then the veterinary business, to France’s Vetoquinol. Then, years later, a clutch of domestic formulation brands and plants went to Dr Reddy’s Laboratories for ₹1,850 crore.
Meanwhile, the US Food and Drug Administration (USFDA), the American drug regulator whose clearance is the gateway to the world’s largest medicine market, was shutting his factories over quality lapses.
One line item was never touched—Khorakiwala steadfastly refused to sell his laboratory. Wockhardt had begun hunting for a new chemical entity—an entirely original molecule, as opposed to a copy of a drug someone else invented—in the late 1990s. The programme was expensive, unproductive, and by any conventional reading of a balance sheet, indefensible. It kept its funding through every round of cuts.
“The philosophy was that if you enter new chemical entity research, you must commit for 25 to 30 years,” Khorakiwala says. His daughter Zahabiya, who runs the remaining hospitals and now leads the commercialisation of the new drug in the US, once described him in that period simply as a fighter who refused to resign himself to any situation.
On 1 June 2026, the USFDA approved Wockhardt’s Zaynich—an intravenous combination of two compounds, cefepime and zidebactam—to treat complicated urinary tract infections, including kidney infections.
Drugs are tested in three phases before approval: Phase 1 for safety, Phase 2 for early signs of effect, Phase 3 features the large trials that clinch the case. In its decisive late-stage trial, Zaynich cured or cleared the infection in 89% of patients, against 68.4% for meropenem, itself one of the most powerful last-resort antibiotics in use. India’s own regulator had cleared Zaynich five days earlier; a European filing is in the works.
It is not a blockbuster, and Wockhardt does not pretend otherwise. It is a hospital drug for patients running out of options against multidrug-resistant gram-negative bacteria—among the hardest infections to treat, because the bugs shrug off most existing antibiotics—and the company is handing marketing and sales to an outside partner rather than building its own American salesforce.
But Zaynich is the first new chemical entity discovered, developed and taken all the way to approval by an Indian company. Until now, that club—with American, British, Swiss, German and Japanese companies, and a handful from other nations—had no Indian member.
Khorakiwala is in his eighties, and he is not inclined to be modest about a wait that lasted nearly 30 years. “We are the most successful antibiotic drug discovery company in the world today,” he said after the approval came through. Six of Wockhardt’s molecules carry the USFDA’s Qualified Infectious Disease Product (QIDP) tag, a designation that fast-tracks antibiotics aimed at dangerous, hard-to-treat infections. “No other company has more than one.”
Punching above their weight
Wockhardt is the furthest along, but it is not alone. A clutch of mid-sized Indian drugmakers—none of them among the country’s biggest—are trying to make the same leap, from copying medicines to inventing them. Mumbai’s Glenmark Pharmaceuticals Ltd has struck one of the largest licensing deals ever signed by an Indian company, for a cancer drug of its own making.
Hyderabad’s Suven Life Sciences Ltd is deep in the final stage of testing an Alzheimer’s treatment that, if it works, would put it in the same bracket within two years.
Biocon Ltd has transferred its research on a dual-acting protein for cancer indications to US-based Bicara Therapeutics in exchange for a 10.1% stake in the company. The move enabled Bicara to raise money from investors and conduct clinical trials. Bicara listed on Nasdaq in September 2024 and raised $315 million from its initial public offering.
And smaller names, among them Chennai’s Orchid Pharma Ltd, are showing that original discovery is no longer the preserve of Western laboratories.
“Hyderabad is buzzing with life sciences startups, especially in the biological space,” says K. Vijayraghavan, chairman and founder of Hyderabad-based Sathguru Management Consultants, which runs a $100 million fund for startups. “There are at least 10 companies that have potential preclinical molecules and it looks like a whole new research ecosystem is coming into the play.”
For instance, Tulsi Therapeutics Pvt. Ltd has successfully completed preclinical animal trials for reversal of liver conditions, while Utopia Therapeutics Pvt. Ltd is developing a vaccine to modulate immune systems and reduce fat accumulation.
Industry watchers read this moment as an inflection point. “There are now at least 10 novel assets that have originally been discovered out of India, and while it’s still a small number for a country like India and an industry which is almost $60 billion in terms of size, it’s been long coming,” says Priyanka Aggarwal, managing director and senior partner at BCG India and head of its healthcare practice for Southeast Asia. “While some assets have come out of the Glenmarks and Wockhardts, which have had the capital and headroom given the fantastic growth over the last two decades, some of them have also come out of industry-academia collaborations, or smaller, younger biotechs.”
Refusing to quit
What links these companies is not scale, but a grim determination to keep going despite setbacks. Glenmark’s Glenn Saldanha spent close to two decades being told his obsession with invention was destroying shareholder value. “People thought we were nuts, putting money behind this all these years,” he says. Ichnos Glenmark Innovation (IGI), the company’s research arm, was burning about $70 million a year and was, in Saldanha’s own blunt phrasing, a drag on the parent’s profit-and-loss account and balance sheet.
In July 2025, the arithmetic reversed. IGI licensed its lead molecule, ISB 2001—an antibody engineered to grip three targets at once, latching on to a cancer cell and to the immune system’s T-cells so the body attacks the tumour—to American drugmaker AbbVie Inc. The disease is multiple myeloma, a blood cancer, and the treatment is for patients who have relapsed.
The terms: $700 million up front, up to $1.225 billion in further payments as the drug hits milestones, and tiered royalties on sales. Roughly ₹6,000 crore landed on a company carrying just ₹400 crore of net debt. Glenmark kept the rights to sell the drug in emerging markets, and kept the underlying technology.
Early trial data had shown four in five patients responding—people who, as Saldanha puts it, had already been through everything else. “Whatever money we poured into innovation over the last decade, we were able to recover all of that through one licensing deal,” he says.
Suven Life Sciences has neither an approval nor a billion-dollar deal to show yet. What it has is a lead molecule in the final stage of testing and four other molecules in development. Overall, Jasti has spent roughly ₹4,000 crore developing this pipeline, focused on the central nervous system, since launching the drug discovery programme in 2003.
Suven’s masupirdine, a compound that acts on a specific receptor in the brain, is in global Phase 3 trials for agitation in Alzheimer’s dementia across some 80 sites in North America and Europe. An independent safety board reviewed the trial’s early unblinded results in June and told the company to carry on unchanged. Enrolment closes this year; results are due in 2027.
Four other Suven molecules—for depression, narcolepsy, and Parkinson’s disease—are in late-stage development. Jasti describes the stakes with the flatness of a man who has made his peace with them: The outcome is binary—success or failure. Nothing in between.
The outlicensing route can pay off even for a company too small to finish the job. Chennai’s Orchid Pharma discovered its antibiotic enmetazobactam in-house but handed it to Germany’s Allecra in 2013 because it could not afford to develop it. Allecra won USFDA approval for the drug, sold as Exblifep, in February 2024—and then went insolvent. In 2025, Orchid bought the global rights back through a French court. The molecule had gone out as a licence and came home as an asset.
Investors have started to notice. Money that was once written off as a bottomless research cost is increasingly being priced as a bet that might, one day, pay off many times over.
Glenmark’s stock-market value has roughly tripled in three years; Wockhardt’s has quadrupled—moves that track the innovation news rather than the two companies’ generics sales. The shareholders who bought in before the milestones landed are sitting on large gains, and the more patient among them are holding on for the bigger prize they think is still coming.
What they did differently
Two things, mostly. First, they sold good businesses to fund the uncertain one.
Khorakiwala gave up hospitals, nutrition, veterinary products and a chunk of domestic formulations—the last of these as dear to him as the hospitals.
Saldanha sold Glenmark Life Sciences, the arm that makes active pharmaceutical ingredients, the chemical building blocks of a drug, to Nirma.
Jasti sold 50.1% of Suven Pharmaceuticals—his highly profitable contract-manufacturing business that makes drugs and ingredients to order for other companies—to private equity firm Advent for ₹6,313 crore in December 2022. He concedes the timing was not ideal—the business had a long runway ahead of it.
“There is a time when you cannot take it further yourself, and when there’s no one after you to take over and run the business—when the opportunity comes, you have to give it up,” says Jasti, 76. There was a more pressing reason, too. The research needed money.
Each of these men, in effect, sold a machine that reliably printed cash to feed something with no revenue and no guarantee of ever having any.
Second, they went where the crowd wasn’t. Wockhardt bet on antibiotics, a field the global giants had largely walked away from because the economics are punishing—treatment courses are short, prices are held down, and hospitals are told to use new antibiotics sparingly to slow resistance. That neglect, Khorakiwala reasoned, was precisely the opening.
Jasti picked a single family of brain receptors and stayed with it for 25 years, in an area most discovery firms avoid because the failure rate is brutal. Saldanha concentrated on multi-target antibodies in cancer, where nine of the world’s 10 largest licensing deals of the past seven years have been struck.
The bar for getting a drug noticed, meanwhile, has risen sharply. In 1997 and 1998, Dr Reddy’s Laboratories Ltd could out-license two experimental molecules—early candidates aimed at diabetes and cholesterol—to Denmark’s Novo Nordisk on the strength of laboratory work and a persuasive story, and collect real money for compounds barely out of the lab. That era is over.
Today a candidate must address a serious unmet medical need, or work through a genuinely new mechanism, to attract a partner early. Everything else, the discovering company must now pay for itself: safety testing, studies of how the drug moves through the body, the clinical trials, the regulatory filings.
Jasti says global drugmakers’ caution in brain disorders has hardened to the point where they will only step in once a drug is all but ready for the market. Wockhardt, in the end, took its antibiotic there on its own.
A cautious return
India’s first drug-discovery wave died young. Parvinder Singh’s Ranbaxy Laboratories Ltd had nothing to show for its research ambitions by the time it was sold to Japan’s Daiichi Sankyo in 2008. Anji Reddy’s programme at Dr Reddy’s produced out-licensing headlines, then setbacks, and was eventually wound down. Lupin Ltd’s ambitions faded too.
The reason was not incompetence but arithmetic: exports of generic drugs to the US were growing at 30% a year with quick paybacks, and every rupee spent in a discovery lab was a rupee not spent on filing to sell another generic in America.
Sun Pharmaceutical Industries Ltd’s Dilip Shanghvi, Dr Reddy’s G.V. Prasad and Lupin’s Desh Bandhu Gupta all made the rational call. Cipla Ltd’s Yusuf Hamied went further, arguing that Indian companies simply lacked the scale for original research—a position the company has never really abandoned.
Money, plainly, mattered—the winning bets have swallowed thousands of crores. But it was not the size of the company or the strength of its generics cash flow that produced India’s first new drugs. It was a conviction concentrated in a few people who would not be talked out of it, and who were willing to put money down on a 20-year gamble.
Today, the big companies are edging back, chastened and selective. Dr Reddy’s is rebuilding a pipeline and a biotech platform, with co-chairman Prasad signalling that the lesson learnt is to go deep in a few areas rather than spread wide.
Natco Pharma Ltd has a molecule in development, and its managing director Rajeev Nannapaneni argues the company is large enough now to fund discovery without betting the house.
“The big challenge in our business today—and it’s a very unusual challenge—is that companies are strong, they have cash, nobody has debt, and everybody competes fiercely with each other,” Nannapaneni says. “What you see are challenges with growth. You see steady income, but you don’t see growth.” As companies hunt for the next leg of growth, he says, everyone is trying to work out the answer, and the answer keeps coming back to innovation.
Sun Pharma has been buying into innovation in the US; Biocon has placed a bet through its US-listed affiliate Bicara; and a broader shift from plain generics towards branded and patented products is under way. It has fresh urgency now that Washington, under US President Donald Trump, is pressing drugmakers to manufacture generic drugs on American soil—a move that threatens the very cost advantage that once made original research look unaffordable to Indian drugmakers.
A start, not an arrival
The ground is shifting in ways that are easy to miss. Indian scientists who spent their careers in Western laboratories are increasingly willing to come home; both Jasti and Nannapaneni say the conversation about talent is nothing like it was 10 years ago.
And the government is, for the first time, putting real money behind the unglamorous work of turning laboratory discoveries into actual medicines—through the ₹5,000 crore Promotion of Research and Innovation in Pharma MedTech (PRIP) scheme and a far larger ₹1 trillion Research, Development and Innovation (RDI) fund cleared in 2025.
The 10 assets discovered in India are no coincidence, argues BCG India’s Aggarwal, but the early fruit of structural change: dedicated early-stage funding through the PRIP and RDI schemes, regulatory reforms aimed at unclogging clinical-trial approvals and timelines, and private capital that is finally beginning to move.
“To mobilize capital, you need investors who believe in the story. The government is doing its bit with several schemes, and it’s also funding a lot of these companies directly,” says Ajay Mahipal, co-founder and general partner at the healthcare fund HealthKois. “It’s propelling private capital to be finally deployed into such companies. The space requires much more patient capital, and we are now seeing more family offices participating in this story.”
Jasti’s diagnosis is blunter, and cuts to how India values intellectual property—the patents and knowhow that are a research company’s only real assets before it has a product to sell.
“If I want to be in the US, my market cap would have three zeros added to it,” he says. “Here IP (intellectual property) has no value. It has no value until it becomes a product. But without it, you cannot have a product. When you have a product without having an IP, then it’s as good as a generic.” It will take one large, visible success, he believes, before Indian investors start putting a slice of their portfolios into “this long-gestation, zero-to-one sum game. And it will come, but it will take time.”
The timing is awkward. China quietly became a force in biologics—medicines grown from living cells rather than mixed from chemicals—while India was perfecting generics, and the global centre of gravity is shifting from the small chemical molecules that are India’s strength towards biologics and cell and gene therapies. Four drugs from a handful of mid-sized companies do not make an ecosystem.
But the template now exists, and it is legible: pick a neglected niche, go deep, fund it by selling something you love, and stay the course for 25 years. India spent three decades as the world’s pharmacy of cheap copies. For the first time since independence, it has something original to sell.
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