There's no easy way to combat recession than cut costs. But with the rising trend of pharma companies going for cut in R&D spending, will consumers have to live with drugs and medicines which were developed a long time ago?
Pharma giants such as Pfizer, Merck and Sanofi have already slashed drug pipelines significantly for cardiovascular and anti-obesity drug.
And analysts say this trend could hit closer home with players like Dr Reddy's Laboratories further pruning its R&D for new chemical entities.
But companies like Sun Pharma, Wockhardt and Piramal Life Sciences say pipelines are steady for now, however, it doesn’t mean they are insulated.
"If the financial situation doesn't improve we'll have to take steps to consolidate pipeline. It’s not happening today but it could happen tomorrow," said Somesh Sharma, MD, Piramal Life Sciences.
Clinical trials can take up to 60-70 per cent of costs in research are forcing companies to prioritise on development of molecules and with most still in the lab stages fewer would make it to human trials.
"There's actually a movement in pharma that says let your products fail fast. If you have a portfolio and spending lots of money on R&D, it is good to identify those products which u don't want and have them fail fast.” said Sujay Shetty, head-life sciences, PWC.
With companies cutting cost drastically, analyst say, Indian drug makers may have a problem with their R&D tie-up deals with overseas players.
Wockhardt is already experiencing with one but there is likelihood that more and more companies may cut such activities threatening discovery of new drugs.