Companies

Piramal to shift focus on late-stage clinical development

P. T. Jyothi Datta Mumbai | Updated on April 12, 2019 Published on August 28, 2014

Swati Piramal, Vice-Chairperson, Piramal Enterprises, said the company’s advisory board was of the opinion that funds should be realigned to late stage research.

Piramal Enterprises is exiting its early drug discovery research and will focus more on late stage clinical development, Swati Piramal, Vice-Chairperson, Piramal Enterprises, confirmed.

Drug discovery research has a long gestation period and the company’s advisory board felt that funds should be realigned to late stage research, she said. The realignment process has just begun with 200 of its researchers at its suburban-Mumbai hub in Goregaon. They have been given a voluntary early separation scheme (VSS) or an option to move to other centres.

“That is not to say we are not doing research and development,” she said, but the company will put its funds on late stage research projects, where it can get maximum returns for its shareholders, she added.

The company has about 900 scientists at eight research centres, including five in India, two in the UK, and one each in the US and Germany, she said.

She said the centre will not shut down and will continue to do formulation (finished drug forms) and contract research. No funds will go into fresh discovery research, but ongoing projects will be completed. An earlier research alliance with Eli Lilly has ended, she said, while another with Merck continues.

Research is being conducted in India and abroad on anaesthesia, active pharmaceutical ingredients, formulations, over the counter products, and molecular imaging, she said. Piramal Imaging, for instance, is working on the detection of emboli that cause strokes.

Research risks

The journey of the company’s research arm reflects the treacherous path that drug research involves, with heavy investments, long gestation periods and little success. In 2007, it demerged its research arm to form Piramal Life Sciences, to cushion the parent company, then called Piramal Healthcare, from research-related risks.

It was a time when fellow-domestic companies such as Dr Reddy’s, Sun Pharma and Glenmark attempted to walk that brave path. Much has changed since, and only Sun Pharma still stands its ground.

The erstwhile Piramal Healthcare later sold its domestic formulations business to Abbott in 2010, for ₹17,000 crore and subsequently sold its diagnostics business to Super Religare Laboratories for ₹600 crore. The early discovery exit would be the third key healthcare segment the group is exiting.

The company re-branded itself as Piramal Enterprises to reflect its aspirations beyond healthcare, as it invested in real estate, the financial sector and defence, besides a short-term investment in telecom company Vodafone. It also merged the early discovery business back into itself in 2011.

The company has since disengaged in the defence sector, Chairman Ajay Piramal had told BusinessLine earlier this year, after the company sold its 11 percent stake in Vodafone for ₹8,900 crore. Investments would continue to go into existing areas of interest, including information services, he said, adding that they were not looking at any new sectors to park their funds.

jyothi.datta@thehindu.co.in

Published on August 28, 2014
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