Sacrifices, trade-offs behind big win, says Glenmark's Saldanha
'We were always resilient in how we approached innovation. I think that's what finally rewarded us," Saldanha, chief executive officer and managing director of Glenmark Pharmaceuticals Ltd, told Mint in an exclusive interview.
He was referring to one of the largest deals for an Indian biopharma firm after Glenmark's US-based unit Ichnos Glenmark Innovation (IGI) secured a $700-million exclusive licensing agreement with AbbVie for its blood cancer drug candidate last week. AbbVie will also pay as much as $1.23 billion as various milestones are completed, as well as tiered, double-digit royalties on net sales.
ISB 2001, the investigational drug to treat multiple myeloma, is in phase-1 clinical trials and has shown promising data. In a trial with 35 patients who had exhausted all existing lines of therapy unsuccessfully, 79% showed a clinical response to it, and 30% were cancer-free.
'I hope this acts as a catalyst to expanding the innovation landscape in India…we've demonstrated that you can do it," said Saldanha.
Last bet
ISB 2001, developed on IGI's proprietary BEAT platform, was the firm's last bet. 'There was no plan B," said Saldanha. 'This was pretty much the end of the road. At this point, the technology had to demonstrate that it worked…or we don't know what we would have done as the next thing."
The drug had been in discovery over the last five years, while the company had been working on the BEAT platform for about a decade. There were three other assets that the company stopped developing.
ISB 2001 has received both the US FDA Orphan Drug and Fast Track designations, highlighting its potential.An Orphan Drug designation is given to drugs treating rare diseases, while a fast track designation intends to expedite the development and review of drugs for treating serious conditions and fill unmet medical needs.
Following the licensing agreement, AbbVie will take over further development for phase-2 and phase-3 trials before it can file for regulatory approval. The process would typically take four to five years.
The market size for multiple myeloma is estimated to grow to $50 billion by 2030.
Should the drug hit the markets in 2030, taking into account the tiered double-digit royalties, Glenmark stands to earn an additional $2.02 billion in royalties until 2041, according to research by brokerage Nuvama.
The deal validates several aspects of Glenmark, including the strength of IGI's BEAT platform, the potential for ISB 2001 to treat relapsed/refractory multiple myeloma, and its commercial viability following successful clinical trials, said an 11 July note by Motilal Oswal analysts.
'Moreover, AbbVie has established itself as a diversified biopharma leader, combining scientific innovation with strong commercial execution. In oncology, the company has built a robust presence anchored by two cornerstone therapies: Imbruvica, a BTK inhibitor, and Venclexta, a BCL-2 inhibitor. These medicines have transformed the treatment landscape for chronic lymphocytic leukemia and other B-cell malignancies, generating multi-billion-dollar revenues and reinforcing AbbVie's reputation as a pioneer in hematologic cancer," the note added.
Huge sacrifices, trade-offs
Saldanha has bet on innovation since he took the reins of the company in the late 90s. A few years after Glenmark was listed in 2000, it established its first R&D centre for novel biologics research in Switzerland.
Over the years, the company did a number of licensing deals with novel assets.
In 2019, it spun off its R&D entity under a new company, Ichnos Sciences, which built on its proprietary BEAT bispecific platform. The two announced the creation of Ichnos Glenmark Innovation (IGI) in 2024.
The company's focus on innovation created a lot of frustration for investors and stakeholders, Saldanha said. '[We were] bordering on being called eccentric," he said.
The company also had to sell its stake in its active pharmaceutical ingredient (API) division, Glenmark Life Sciences, to pare its debt in 2023, which was approximately ₹4,500-4,600 crore. Glenmark sold 75% stake in the unit to industrial conglomerate Nirma for ₹5,650 crore.
The company has made 'huge sacrifices, huge trade-offs," said Saldanha.
With the GLS sale, the company had a choice to decide 'which end of the value chain we play", said Saldanha. 'Whether we play on this API stable end of the value chain, and generate revenues like that, or we play on the high end of the value chain, which is innovation."
But innovation is not a cost game, he said. 'It's all about being able to understand where the therapy is going and how to come up with solutions."
What's next for Glenmark?
IGI spends about $70 million annually on new drug research. With the upfront payment it receives, it will be self-funded for the next three to four years, said Saldanha.
The company will also look at rewarding shareholders with dividends.
Apart from that, there are no immediate investment plans, said Saldanha. 'At least for the next year or two, we won't do anything. We'll just continue regrouping and trying to figure out strategically where we can further add value," he said.
The deal is a big event for the company, which 'basically resets the whole agenda for the company", he said. 'We have to really reset and rethink how we want to see the company over the next five to ten years."
ISB 2001's early success has validated the BEAT platform. 'We think we've now got it right with the technology…the idea is how can we exploit that technology much more effectively to add more products and do more," said Saldanha.
The unit has another asset called ISB 2301, which is in late pre-clinical development and will go to the clinic next year. This drug will target solid tumours, said Saldanha. IGI also has a couple of other early-stage programs. '...over the next three, four years, we will exploit the technology as effectively as possible."
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