Jubilant Organosys, an India-based integrated pharmaceuticals industry player, has formed a 50:50 joint venture (JV) with the US-based multinational drug major Eli Lilly to develop molecules across several therapeutic areas.

This is the first time that any global discovery drug company has shaped a JV with an Indian firm.

Under the arrangement, the joint venture will work on drugs in oncology, metabolic disorders, cardiovascular and diabetes segments and will offer pre-clinical work besides developing the molecules through to phase-II clinical testing.

In addition, after completion of phase-II testing, the successful assets will be returned to the sponsors or the IP owners for further development. The JV partners plan to spend around $8 million in a span of three years.

Both companies already have a five-year drug discovery pact since 2006, where Jubilant provides pre-clinical work for Eli Lilly.

The equal joint venture, which will be based out in Bangalore is expected to start operations in the last quarter of 2008.