Mumbai, September 10, 2008 (IANS)

India's drug regulator agency Central Drugs Standard Control Organisation (CDSCO) is drawing up plans to allow international companies to conduct initial-stage drug trials in the country, a senior official said Wednesday. The move by the CDSCO is expected to increase contract research outsourcing business to India. According to global auditing company KPMG, Indian clinical research market is estimated at $200 million in 2007 and is expected to touch $500-$600 million by 2010.

At present, global drug firms are allowed to conduct only mid-stage and last stage or phase III trials in India. However, Indian companies are allowed to conduct all stages of trials. "We have had two series of meetings with stakeholders," Drug Controller General India Surinder Singh said. "There are certain areas that need to be addressed, but we can notify phase zero and phase I,” Singh said on the sidelines of a pharma summit.

Phase zero and phase I are the initial stage tests, where drug is first tested on a few human beings. "Policy initiatives like revisions in the Patents Act, stringent measures to prevent making spurious drugs and creation of pharma R&D (research and development) fund with corpus of $33.3 million are some of the steps taken by the regulator," Singh added.

Global drug firms, reeling under onslaught of generic competition and rising drug development costs, are increasingly outsourcing their drug discovery research to low-cost destinations such as India. “However, the sector is currently undergoing a challenging phase. Firstly, a large sum of their revenues is at risk as drugs worth $47 billion are expected to go off patent in the US market alone over the next three years,” the KPMG report said.

“Secondly, there has been an increased penetration of generics in global markets that have traditionally been dominated by innovator products. Further, the industry has witnessed a considerable reduction in the number of new product approvals,” it said.

In 2007, the US Food and Drug Administration (USFDA) approved just 19 new drugs, the lowest in 24 years. “Also, the safety standards for new drug approvals have become stricter as a result of the recent withdrawals and black-box warnings received by some high-profile drugs,” the report added.