"Indian companies are becoming leaders in capital investments in generics and are leading in drug master files (DMFs)," says Cynthia Dowd Greene, vice-president for industry research at Newport Strategies (Portland, ME, http://www.newportstrategies.com/), who recently spoke at the Generic Pharmaceutical Association's (GPhA, Arlington, VA, http://www.gphaonline.org/) API 2006 Meeting. In 2005, Indian companies filed 265 DMFs, up from 227 in 2004 and 139 in 2003, notes Greene.

"This trend is apparent in the success of first-tier companies such as Dr. Reddy's Laboratories and Ranbaxy in the US market," says Greene. "They are strong competitors in the US generics market by supplying finished-dosage products. They also have a strong API presence and will supply APIs to other US generics companies. And, they have strong R&D organizations for supporting patent challenges, generic product development, and now are focusing on their own drug discovery efforts."

Ranbaxy's R&D center in Gurgaon, India.

Dr. Reddy's and Ranbaxy expand

Dr. Reddy's Laboratories (Hyderabad, India, http://www.drreddys.com/) is building its core generics business, developing a footprint in pharmaceutical custom synthesis, and strengthening R&D. In March 2006, it completed the acquisition of Betapharm Group, the fourth-largest generic pharmaceutical company in Germany.

Dr. Reddy's is advancing its internal R&D, with pacts with Argenta Discovery Ltd., Rheoscience A/S, and Perlecan Pharma Private Ltd. Perlecan was formed in 2005 with $52.5 million in initial funding from Citigroup Venture, the Indian private equity group ICICI Venture, and Dr. Reddy's for advancing four of its new chemical entities. ICICI also invested as much as $56 million in partnership for commercializing abbreviated new drug applications (ANDAs).