Mumbai-based drugmaker Glenmark Pharmaceuticals announced on July 10 one of the largest global licensing deals for an Indian-origin biotech asset.
ISB 2001, a cancer (multiple myeloma) treatment developed by Glenmark’s US-based subsidiary Ichnos Glenmark Innovation (IGI), has been licensed to US pharma major AbbVie for $700 million (Rs 6,000 crore) upfront. IGI could earn up to $1.225 billion in additional milestone payments based on the progress of the drug through clinical trials and regulatory pathway. The company will also receive double-digit royalties on sales, once the drug is commercialised in the US, Europe, China and Japan.
In an interview with Moneycontrol on July 14, Glenn Saldanha, Chairman and Managing Director of Glenmark, discussed the company's transformative deal with AbbVie, future pipeline, strategic financial deployment, and global therapeutic area leadership.
Saldanha said that partnering with AbbVie has “de-risked” the company and made the R&D unit self-sufficient and self-sustaining for at least 3-4 years. The money would help IGI to develop many more assets, which can then be licensed out. Saldanha said he hasn’t yet fully figured out how to deploy much of the proceeds of the licensing deal, but added that he would be careful.
“My experience tells me one wrong move can set you back 4-5 years. So, we need to be very careful," he said. Glenmark has a net debt of around Rs 400 crore.
Glenmark is India’s 11th largest pharma company by market capitalisation and 12th by FY25 revenue. The company has revenue of Rs. 13,322 and net profit Rs. 1,047 crore (FY25). It's latest market capitalisation is Rs 61,370.21 crore.
Edited excerpts:.
Q: Congratulations on the AbbVie deal. Could you clarify the deal's big payout? Given the inherent uncertainties in drug development, how optimistic are you about receiving the milestone payments?
Saldanha: Thank you. The deal includes a significant $700-million upfront payment, which is already in the bank. Beyond that, there's a potential for an additional $1.2 billion in milestone payments. Well, honestly, I can't say with certainty. Drug development is inherently risky. In our 25 years, we've had many molecules, but none made it to the market, so failure is part of the game.
The only guarantee we have is the $700-million upfront payment. That's for sure. Everything else depends on how clinical trials progress. We'll receive milestones as they cross certain phases. These include clinical, regulatory, and even sales-linked milestones. Then there are potentially substantial double-digit royalties, which could be truly transformational and act like an annuity for 15-20 years, making the numbers very big.
Q: What does this mean for Glenmark’s financials and future direction?
Saldanha: Effectively, by partnering, we've passed on the risk and de-risked ourselves. We've taken some money off the table. Crucially, we've retained the rights for emerging markets, including India. So, we've basically de-risked part of the asset by partnering with a big pharma and effectively monetising it.
Q: Can you provide an update on the clinical trials of the drug (ISB 2001)? Where are they being conducted? How long will it take to cross the finish line?
Saldanha: The clinical trials are already underway. We're currently in Phase 1B, conducting a dose expansion trial. The trials are primarily being conducted in the US, Australia, and Europe – those three geographies. Typically, assets at this stage, if you look at comparable ones, take about 3-5 years to get to commercialisation, even with fast-track approvals.
Q: What was the reception like for the scientific presentations on this drug at conferences?
Saldanha: Our first major presentation was an oral one at ASH, the American Society of Hematology, which is a big platform. Everyone really got excited by the clinical data. We followed it up with a presentation at American Society of Clinical Oncology (ASCO) in May. By that point, we already had a number of companies showing super interest in licensing this asset. The clinical response rates have been quite remarkable. For a drug at this stage, with 30-40 patients dosed, we saw a 79 percent overall response rate. This means patients who had exhausted almost all other lines of therapy, including bispecifics, chimeric antigen receptors (CAR)-T cell therapy, and antibody drug conjugates (ADCs), showed a response. And what's even more impressive is that 30 percent of them achieved complete remission, meaning they are cancer-free.
Q: Can you tell us more about the BEAT platform, the core of Glenmark's multispecific antibody therapy?
Saldanha: Certainly. Historically, antibodies on the market, like Darzalex or Humira, are monoclonal antibodies. They mimic the body's natural antibodies and bind to a single site. What we've done with our BEAT (Bispecific Engagement by Antibodies based on the T cell receptor) platform is to re-engineer some of these structures. We essentially changed some of the DNA sequences and protein structures in the Y-shaped antibody. So, a bispecific means you're replacing two ends of the antibody, and a trispecific means three ends. This allows it to bind to multiple sites. For example, one end can engage T-cells, and the other can engage the tumor. With trispecifics, you're adding a third variant, so, say, two will bind to the tumor and one to the T-lymphocytes to bring them to the tumour and kill it. These are all genetically engineered antibodies.
The BEAT technology was developed as a 'plug-and-play' platform. We started with bispecifics and then further modified it to create tri- and multispecifics. Having multiple binding sites makes it much more powerful. In oncology, patients often progress through different therapies. For instance, in multiple myeloma, they might start with a monoclonal, then move to a bispecific, and when the tumor reinvents itself, you can introduce a trispecific. This forces the tumor to deal with three different binding sites, effectively prolonging the patient's life, as there's no ultimate cure for cancer.
Q: What other assets are in Glenmark's multispecific antibody pipeline using the BEAT platform? Are they focused only on hematology?
Saldanha: We've only disclosed one additional near-term asset, which is 2301. While 2001 is a T-cell engager, 2301 is an NK cell engager. It's also a multispecific antibody, and we're hoping to get that into clinics next calendar year. It's a very exciting asset. We have a couple of other early-stage multispecific antibody programmes as well, but it's too early to talk about them. And no, these are going beyond hematology; we're also targeting solid tumors.
Q: How will this deal transform Glenmark Pharmaceuticals, particularly regarding its subsidiary IGI?
Saldanha: This deal is transformative. IGI was heavily dependent on Glenmark for funding, burning about $70 million a year, which was a huge drag on Glenmark's P&L and balance sheet. With $700 million coming in, IGI will be self-sufficient and self-sustaining for at least the 3-4 years. Plus, some of that money will come back to the parent company for our investments in IGI, through dividends and so on. This means that within the 3-4 years, IGI will be able to develop many more assets, which can then be partnered out, leveraging the technology much more effectively.
Q: How does Glenmark plan to deploy the $700-million upfront payment? Are there any M&A plans?
Saldanha: M&A is not on the cards for at least the next year or two. After that, we'll evaluate. In-licensing, however, is something we continuously explore. For example, we did deals with Jiangsu Alphamab Biopharmaceuticals and 3D Medicines (Beijing) for the cancer drug, KN035 (Envafolimab). We're commercialising Envafolimab for all emerging markets. We also in-licensed Winlevi in Europe and Abrocitinib from Pfizer in India. This is part of our strategy to expand and leverage our global distribution. Regarding the capital, it will primarily sit as cash on our books, helping to de-leverage. We're taking our time to regroup and strategically figure out how to deploy this capital. My experience tells me one wrong move can set you back four or five years, so we need to be very careful.
Q: What are Glenmark’s core therapeutic focus areas?
Saldanha: Globally, we are focused on dermatology, and the respiratory and oncology segments. In India, we also have cardiovascular segment and are entering the diabetes segment with GLP-1s. But we don’t define ourselves by market rank. For us, it’s about dominating certain therapies globally.
Q: What are the biggest challenges for Indian pharma companies in drug innovation, compared to global players, and what can be done to accelerate it?
Saldanha: I've spent 25 years of my life to get to just one (ISB) 2001. Innovation is a global game, and you're competing with the biggest players in the industry – all the big pharmas with deep pockets, huge resources, and the best knowledge base. It's not an easy game to play, and India has a lot of work ahead to keep replicating these successes. Hopefully, this deal will inspire other companies to invest more in innovation. China has achieved a lot, largely due to immense government support. Here, it's largely the private sector , and it's extremely difficult to balance capital market expectations, short-term quarterly profits, and long-term investment. The de-risking mechanism is largely through licensing. There's hardly any VC money flowing into India for smaller biotechs to fund their research.
Q: Are you preparing any succession plan for the company?
Saldanha: I think it's still early. But I think, I mean, this is it. It's a boring business. I mean, we run a boring business. We can't generate that much news… Next gen will come at some point, right? The question is, for now, it's... I'm still young, so I think I still have some time. I'm 55 now, so I have some runway.
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