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What happened to R & D?

Aug 8, 2000

Around nine months back the market was agog with rumours of Indian companies doing path breaking research. Ranbaxy developed a new single dosage delivery mechanism for ciprofloxacin, which it sold to Bayer. Dr. Reddy’s licensed two anti–diabetes molecules to Novo Nordisk and received its first milestone payment. Cipla was reported to be working on new chemical entities (NCEs). Nine months later the aura seems to have worn off. Cipla is yet to announce any pathbreaking result. The management of Dr Reddy’s has been unduly cagey about reports of the second milestone payment being received from Novo Nordisk.

Ranbaxy is also supposed to be receiving a second milestone payment for its deal with Bayer in the third quarter. It’s high time the company actually did! The stock has almost halved over the last nine months and the first half performance of the company has been nothing to write home about. Ranbaxy was also supposed to be working on a BPH (benign prostrate hyperplasia) compound, but the company has yet to announce the progress on the research.

The world over pharma companies make regular disclosures about the stage at which each molecule is (i.e whether the molecule has completed pre clinical trials or phase I or phase II of clinical trials). Indian companies are still very secretive about these issues.


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