Ranbaxy And GSK Extend R&D Ties

Ranbaxy Laboratories and GlaxoSmithKline have signed an R&D agreement that expands the terms of one signed in 2003.

Under the original deal, Ranbaxy limited itself to optimization chemistry work on drug leads. Now, the Delhi-based firm will continue developing leads to the point of clinical proof of concept.

The new agreement also clarifies the conditions under which GSK will make milestone and royalty payments. Ranbaxy says it could receive more than $100 million in milestone payments as well as royalties in the double-digit range on sales of commercial products.

The firms say they will collaborate to develop anti-infective, metabolic, respiratory, and oncology products. GSK is managing the collaboration as part of its Center of Excellence for External Drug Discovery (CEEDD), which is an attempt to boost the company's pipeline by relying on the research capabilities of third parties.

"This expanded agreement builds on the success of the existing collaboration and furthers our CEEDD strategy of building a strong pipeline through to clinical proof of concept via external R&D collaborations," says Maxine Gowen, senior vice president of the CEEDD.

Ranbaxy employs a total of 1,200 scientists, 300 of whom are engaged in drug discovery work. "I believe the arrangement with GSK is path-breaking and acknowledges the higher level of R&D maturity prevalent today in our state-of-the-art labs in India," says Ranbaxy CEO Malvinder M. Singh.