Outsourcing Drug Work

Abstract

The article discusses how the Mumbai-based D&O Clinical Research Organization has been manufacturing precursor drug compounds for foreign pharmaceutical companies for more than a decade. Just this year, however, D&O expanded its services to include support for clinical trials, specifically, coordinating the studies and managing data. The expansion is intended to corral more clients as India's business climate heats up. As part of a World Trade Organization agreement that India signed in 1995, starting next year the country will honor product patents. Although pharmaceutical giants such as Novartis, Pfizer and Eli Lilly have commissioned Indian firms to manufacture compounds for years, all R&D work -- drug design and preclinical testing -- has been done elsewhere. The intellectual-property law change will also jump-start growth in the market for the clinical trials. But as foreign companies set up shop in India, expertise will grow. Take Mumbai-based SIRO Clinpharm, one of India's first contract research organizations. It has been performing clinical trial services for the past seven years. Drug outsourcing's biggest plus is cost savings. Pharmaceutical companies spend as much as 20 percent of their sales on research and development. Indian drugmakers spend a quarter as much or less. Certainly India isn't the only country to which pharmaceutical companies can take their business.