Novel drug discovery gathers pace, 1,095 drug discovery programmes in pipeline

Green shoots of innovation are emerging, and momentum is building as India makes its foray into innovation-based growth from a scale-based generics play, according to a report by Boston Consulting Group (BCG) and HealthKois. HealthKois (Fund III) is a $300 million India-focused healthcare innovation and impact fund led by Charles Janssen, Ajay Mahipal, and Dr Pinak Shrikhande. The ‘Built on Scale, Turning to Science: India’s Pharma and Life Sciences Innovation Opportunity’ report says the country will have to strengthen early-stage capital, translational research, clinical trial infrastructure, and specialist regulatory capacity to reach its potential.

Priyanka Aggarwal, managing director and senior partner, BCG India and Southeast Asia Leader, Healthcare Practice, said there was a fundamental shift in ambition from replication to origination, and from process excellence to scientific discovery. “Realising this potential will require building specialist biotech capital, deepening academia–industry partnerships, creating fast-track regulatory pathways, and bridging the talent gap in R&D and innovation”, Aggarwal said. In the next three to four years, this sector could attract around $ 4 billion from PE/VC investors, she said.

What India does in the next five years will determine whether it converts its strengths in cost, data and scientific talent into a durable innovation engine, the report said. Despite carrying 15% of the global disease burden, India conducts only 4% of global clinical trials, while annual pharmaceutical R&D spending was $2-3 billion compared with $70-75 billion in the US. Access to early-stage patient capital was a constraint, with only 10 to 15% of Indian venture capital firms possessing deep pharma and biotech expertise.

Companies are pursuing multiple pathways to compete globally. According to the report, small molecules account for about 49% of PE/VC investment and 58% of active patents, while AI and digital therapeutics attract around 17% of private capital. “Indian companies are proving multiple routes to global relevance: developing novel science in India first and taking it worldwide, out-licensing India-origin innovation to global players, and spinning breakthroughs out of academic labs,” Abhinav Anand, Partner, BCG, said. Zydus developed indigenous molecules like Saroglitazar and Desidustat in India and is now scaling them globally. Glenmark advanced a first-in-class asset through global development, culminating in a $700 million upfront licensing deal with AbbVie,” Anand said. ImmunoACT collaborated with Cipla to take its indigenous CAR-T therapy to South Africa, Algeria and Morocco, and Peptris licensed India’s first AI-discovered drug candidate to Revio Therapeutics.

“India is at a genuinely exciting inflexion point, shifting from replication to origination, with multiple forces converging to make that possible,” Ajay Mahipal, co-founder and general partner at HealthKois. “India is building a differentiated advantage by combining cost, data and scientific talent in ways few countries can match. Our role is to fuel that engine by providing patient capital, domain expertise and specialist networks that help companies scale,” Mahipal said

The report notes that the strongest opportunities lie in cost-disruptive innovation, India-specific data-led precision medicine, and science-driven platform development, underpinned by clinical-trial costs that are 50 to 60% lower than in the US, deep scientific talent, large-scale patient data, and unmatched genetic diversity. Regulatory reforms that have compressed drug-development timelines from 180–270 days to 60–120 days and shared R&D and manufacturing infrastructure such as Genome Valley and C-CAMP have been enablers, the report notes.