Orchid in talks to license out diabetes molecule

Bulk drugs and formulations major Orchid Chemicals and Pharmaceuticals is set to license out its first researched anti-diabetes molecule, BLX 1002.

The company is learnt to have initiated talks with multinational companies and a deal is likely to be signed in August, said sources.

Orchid Managing Director K Raghavendra Rao told Business Standard the company would like to license out the molecule after completing the on-going phase-II trials in Europe.

"The current studies are expected to be completed in a month. Since the molecule has successfully completed phase-I(a) clinical trials and phase-I(b) in Europe, we are confident that this promising anti-diabetes molecule would give us an edge on the negotiation table," he said.

However, he did not give any time-frame and the realisation value of the licensing deal. "It is too early to comment on the expected valuation of the molecule," he said.

Analysts said if the licensing deal is signed in the second quarter of the next financial year as expected, it would give a much needed boost to the company's revenue as the valuation is likely to be "substantial".

On the progress of the drug trials in Europe, Rao said the dose-escalation study on the lead has proved safety of the molecule up to 1600 mg as compared with the anticipated human dose levels of 20-40 mg.

"The study has also shown that it is a highly safe diabetes compound, which do not have the side effects of the existing diabetes drugs," he said.

"The tests provide evidence of the glucose lowering efficacy and the triglycerides lowering potential of the molecule in diabetic patients. No adverse impact or reactions were noticed during the tests in liver enzymes as well. The molecule does not induce weight gain unlike other known anti-diabetic compounds," he added.

The patent application filed for BLX-1002 in the US has already been granted, admitting all claims. The patent covers the efficacy of the molecule not only in diabetes and hyperlipidemia but also in certain other auto-immune and neurological indications.

"We believe that this should also strongly position Orchid in the global drug discovery space. We have identified lead molecules in a few other therapeutic areas which are currently undergoing pre-clinical trials. We are confident of taking them into phase I trials during this fiscal," Rao said.

The Chennai-based pharma company has recently signed a long-term master research & development agreement with Pfizer International. Under this pact, the company will provide research and development services to Pfizer's animal health business.