Neuland clinical-trials foray by Nov

Hyderabad company will begin with phase II and III trials

MUMBAI: Neuland Laboratories, a Hyderabad-based manufacturer and exporter of bulk pharmaceutical ingredients, will offer clinical trials services by October-November this year through its joint venture with US-based clinical research organisation Cato Research.

Neuland holds 70% in the joint venture, Cato Research Neuland India, formed in September 2007, said Saharsh R Davuluri, the Hyderabad company’s vice president of corporate planning & development. Neuland has invested about $0.5 million in the JV.
Davuluri said that initially, the company would conduct only phase II and III trials. “We will enter phase I and IV trials in a year or two. All these trials will be done for Cato’s clients-some of the top pharmaceutical players in areas such as diabetes, cardiovascular diseases, dermatology, oncology and others,” Davuluri added. Cato has presence in several European and American countries.

Phase II and III trials are conducted on patients while phase I trials involve healthy subjects, except those for cancer and AIDS drugs. Phase IV trials are conducted after the drug has been launched in the market.

Depending on the project, Neuland is expected to conduct between 10 and 20 trials annually. Davuluri was unable to put a figure to the revenues the clinical trials business might generate for the company.

The earnings, however, could be significant, as pharma companies are expected to spend about $1.5 billion on trials by 2010, said a study by consulting firm McKinsey & Co. India is fast becoming a hub for such trials, thanks to its massive population and patient pool that has 41 million diabetics and 25 lakh cancer patients.

For now, Neuland depends on the active pharmaceutical ingredient (API) business for as much as 90-95% of its Rs 230-crore revenues. APIs are substances in a drug that makes it pharmaceutically active.

In the last two years, the company has invested Rs 100 crore in this business and 2008-end, hopes to increase the annual API production at its two Hyderabad facilities to 2,000 tonne from 1,000 tonne now.

Neuland is also eyeing other segments such as drug discovery and bioanalytical studies, and formulation development. Davuluri said that the company might scout for a US-based partner to enter formulation development, which involves developing the API into a tablet or capsule.

g_priyanka@dnaindia.net