Merck-Wellcome trust JV spillovers

VaccinationMerck’s joint venture with the Wellcome trust to develop vaccines for the developing and less-developed world is a potentially pathbreaking solution to address the needs of these constituencies. But apart from the vaccines that this joint venture will hopefully help bring to market at affordable prices, it also has other benefits.

One, the JV is a big-ticket foreign investment in research and development of pharmaceuticals in India, where the centre – Hilleman Laboratories – will be located.  Both sides have committed seed funding of a combined $148 mn over seven years or an average of $20mn a year, something that few, if any, vaccine companies in India can commit to original vaccine R&D even if they’d like to.  Yet, it provides an opportunity close to home for interested Indian producers to partner early on in the development process as one stated intent is to combine forces with local companies at some point.

Two, industry has long lamented that India’s biology skills have not kept pace with its chemistry skills.  While there may be biology and biotech graduates aplenty, few understand how their learnings can be applied in industrial research. This is because while chemists have always been in demand because of India’s reverse-engineering industry, the biologist’s star has risen more recently as Indian companies began investing in new drug discovery – which requires deep knowledge of both. Yet, even today, these companies are nowhere as numerous as the ones doing only copycat chemistry thus providing far fewer opportunities for learning and cross-pollination as scientists move around.  Initiatives like this one could therefore be useful in helping to steepen the learning curve.

Clearly, an experiment worth watching closely.


2 thoughts on “Merck-Wellcome trust JV spillovers

  1. Gauri, At a time when a few companies are linking investment commitments to patent rows in India, MSD’s position is laudable. As you pointed out, its time for Indian companies to pool knowledge and work on newer, more meaningful areas of research with this new venture.
    But I doubt the sustainability of the joint venture. The release indicates that in the course of time, it will get funds from other agencies or organizations for continuity. But, thats after seven years. So, I guess its fine for now.


    1. Vikas, your point on sustainability is valid. However, I believe it is in the interest of developing countries like India to pitch in here – after all this will benefit their people the most. You can’t expect to rely entirely on private initiative or charity all the time. India, for instance, has a budget for R&D – there’s really nothing stopping the Indian government – provided they see value in this effort – to step in. After all historically much money has gone into “blue-sky” sort of research in our govt labs.. this venture on the other hand seems aimed at putting real products on the market. In addition, homegrown Indian companies – who have appropriated the platform of providing affordable generic medicines to the world – can now take the chance to provide affordable new vaccines, can’t they? And there can be new models where if there is no cash that the generic firm can spare, contributions can be in kind – like donating scientists’ time or offering to undertake some tests pro-bono etc. Just a thought. There are ways and ways.. if there’s a will.


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