Mumbai: Ranbaxy Laboratories, the country's largest drug maker and US drug maker Merck & Co are close to striking a deal for collaborating on research for new drug discovery.
While Merck will identify the drug leads - potential molecules that can be developed into new drugs - Ranbaxy will develop the drug to the stage of human trials.
The Gurgaon-based company plans to list the recently hived-off research unit, Ranbaxy Life Science Research, which will tie up with Merck for new drug research.
The tie-up could potentially generate up to $100 million (Rs414 crore) in revenues for Ranbaxy's new research unit.
Ranbaxy has a similar research alliance with GlaxoSmithKline. Under the deal, struck in 2003, Ranbaxy conducts the optimisation chemistry required to progress drug leads to the stage of candidate selection.
Ranbaxy had last year extended the scope of this R&D agreement with Glaxo. As per the revised agreement, Ranbaxy will advance leads beyond candidate selection to completion of clinical proof of concept.
Glaxo will conduct further clinical development for each programme and take resulting products through the regulatory approval process to commercialisation.
Under the deal, Ranbaxy will retain the right to co-commercialise the products in India in addition to royalties and milestone payments over product sales.
Merck had also recently entered into an agreement with Nicholas Piramal for oncology drugs besides its deal with Tata Group-controlled Advinus for metabolic disorders.
A molecule for treating respiratory inflammation is already under development.
Ranbaxy Laboratories Limited is an integrated, research based company, producing a wide range of generic medicines, ranked amongst the top ten global generic companies and has a presence in 23 of the top 25 pharma markets in the world.
The company has operations in 49 countries, world-class manufacturing facilities in 11 and a diverse product portfolio. Ranbaxy employs 12,000 people worldwide.