Ranbaxy Laboratories and GlaxosmithKline (GSK) have signed a new multiyear R&D agreement that modifies and expands the terms of their strategic alliance established in 2003. The new pact provides Ranbaxy expanded drug-development responsibilities and further financial opportunities.According to an official release issued by Ranbaxy to the BSE today, under the original agreement, it conducted the optimization chemistry required to progress drug leads to the stage of candidate selection. Under the new agreement, it will advance leads beyond candidate selection to completion of clinical proof of concept. GSK thereafter will conduct further clinical development for each program and take resulting products through the regulatory approval process to final commercialization.The company could receive over $100 million in potential milestone payments for a product developed by it and subsequently launched by GSK in multiple indications and up to double digit royalties on worldwide net sales. It will retain the right to co-commercialize the products in India. The new milestones and royalties will apply both to future drug discovery programs and to the two programs currently ongoing, that were commenced under the original agreement with GSK.Welcoming the expanded agreement with GSK, Malvinder Mohan Singh, CEO and MD, Ranbaxy, said: "This is a great moment for our scientists. The agreement presents a unique opportunity to demonstrate the India centric advantages of high quality research and development to deliver value at the cutting edge. 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."Reflecting on the agreement, Pradip Bhatnagar, vice president (new drug discovery research), GlaxosmithKline said: "This is a win-win agreement for both companies. By collaborating with Ranbaxy's talented R&D team, GSK will be able to develop more products for patients faster and Ranbaxy will benefit from GSK's vast drug discovery and development experience."
