ICICI to fund Dr Reddy’s R&D move

EPP News Bureau - Mumbai

Pharma major Dr Reddy’s Laboratories (DRL) has entered into $56 million agreement with ICICI Venture Funds Management Company for the development and commercialisation of abbreviated new drug application to be filed in 2004-05 and 2005-06.

Under the terms of agreement, ICICI Venture will fund the development, registration and legal costs related to the commercialisation of ANDAs on a pre-determined basis. The agreement would cover most of the ANDAs to be filed by Dr Reddy’s during the years 2004-05 and 2005-06, and ICICI Venture will be paid royalty by Dr Reddy’s on net sales for a period of five years. In the first phase, ICICI Venture will fund $22.50 million with an option to invest an additional $33.50 million in the second phase.

Speaking on the occasion, GV Prasad, CEO, Dr Reddy’s said, “We are pleased to partner with ICICI Ventures in what I believe is an unique R&D funding model.” “This model will enable us to share the product development costs while leveraging our global scale and infrastructure. We look forward to a successful partnership with ICICI Venture”, he added.

Commenting on the partnership, Renuka Ramnath, Managing Director and Chief Executive Officer, ICICI Venture, said, “This is an exciting and new concept of R&D risk capital funding model in India. The innovative structure of the deal is part of our continuing philosophy of promoting India’s story. We believe that Dr. Reddy’s commitment to R&D will make this partnership successful and mutually beneficial.”