India is emerging as an important destination for global pharmaceutical companies, which are increasingly considering outsourcing and offshoring their drug discovery, research and development (R&D) and clinical research. The current Indian clinical research outsourcing market is estimated to be around $100 million and is expected to grow at a rate of 80 per cent in the coming year, while the relatively matured $9 billion (2003-04) global industry is growing at 15-18 per cent.

Explaining this emerging trend, SAS India head of marketing George Varghese said, “there are obvious reasons like talent pool, infrastructure facilities, large and diverse patient pool, qualified doctors, and many more. Today, pharma companies are not asking a question as to if they should consider offshoring to India, but which phase of the drug discovery process in order to derive maximum value.”

Apart from providing solutions to the pharmaceuticals industry, SAS India has identified the contract research organisation (CRO) market for growth here. It is offering solutions like SAS scientific discovery solutions, SAS drug development, SAS drug discovery, SAS process intelligence, SAS patent portfolio management, among others. It’s clientele includes companies like Lambda Therapeutic, Wellquest, Quintiles, Lotus Labs, among others.

“Our end-to-end solutions are aimed to drive efficiencies throughout every stage of a drug’s lifecycle: from discovery, through development, commercialisation and beyond,” he explained.

Talking about the industry scenario, he said, “While globally, around $40 billion is annually spent on drug development R&D, the pharmaceutical industry is quickly approaching a crossroads. After years of rapid growth and unprecedented profit levels, researchers are finding fewer and fewer unique molecules - which means that the era of “blockbuster drugs” (and the $1B or more of annual revenue that comes from them) is coming to an end.”

Going further, he said, “Patent expirations are leading to generic erosion of the market. Of the 44 products generating blockbuster sales in 2000, 33 will lose patent protection in the US before 2007, exposing approximately $45.5 billion of US ethical revenues to generic competition.”

According to Mr Varghese, another area of concern, is that rising research and development costs are eating away at future profit potentials. “Drugs that are successfully commercialised fail to reach their maximum profit potential due to reduced time on the market - related to either manufacturing problems or withdrawal of the drug due to post-marketing safety concerns.”