Mumbai-based drug major Nicholas Piramal India (NPIL) is in talks with private equity funds for the sale of a ‘small’ stake in its research company, to be soon renamed Piramal Life Sciences, company’s top officials said on Tuesday. “We will get additional funding within one-year of listing of the company,” said Piramal group chairman Ajay Piramal. “We have been approached by several PE funds, but this is still early days.” Piramal Life Sciences will be listed in India in the first or second week of June.
The company is seeking funds for its recently spun-off research company to mitigate the risks and costs involve in new drug development. The move may also allow the company to license out its new molecules at a later stage of development and, therefore, extract more value from its research.
“For molecules targeted at niche therapeutic segments that typically require limited clinical trials, we would complete clinical trials and market the drug ourselves in certain countries,” said Mr Piramal. “But for drugs developed to treat common diseases like metabolic disorders, at a certain stage of clinical development, we will seek an outlicensing partner.”
Three independent reports published by Lehman Brothers, Enam and Kotak Securities have valued the pipeline of drugs under development at the research entity between $480 million and $540 million, said Mr Piramal. The company’s anti-cancer lead, a protein molecule involved in the regulation of the cell cycle and cell proliferation, is currently in phase I and II of clinical trials in Canada and India. A highly potent antibiotic drug candidate — active against methicillin resistant Staphylococcus aureus (MRSA) and vancomycin resistant Enterococcus (VRE) — is in late pre-clinical development.
The company is also working on two herbal drugs in phase II of clinical development, targeted at inflammation and infectious diseases, respectively. The company expects to have in total seven molecules in clinical trials by the end of this fiscal.
Source: Economic Times