Several Indian pharma companies have hived off their R&D units to de-risk their core generics business, and to re-new focus and increase investment in innovative R&D. Such a structrue unlocks value in the core generics business while resulting in faster growth of the NCE (new chemical entity) business.

Dr. Reddy’s Labs and Sun Pharma were the pioneers of this trend in the Indian market. Nicholas Piramal, Wockhardt and Ranbaxy followed suit. Glenmark Pharma, used a different strategy; it hived off its generics business and retained its R&D business, expecting better valuations for a generics business than a hived off R&D business.

Many other pharma companies like Natco Pharma, Strides Arcolab and Shasun Chemicals and Drugs are also planning to re-risk their R&D business.

This is an extract from the Update Newsletter to our report "Pharmaceutical Outsourcing in Drug Discovery and Development: Contract Research Opportunity in India". The newsletters are sent complimentary with the report.

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