Glucocorticoids are used to treat many different inflammatory conditions such as rheumatoid arthritis, inflammatory bowels disease, psoriasis and asthma.
The goal of the extended agreement is to design new selective glucocorticoids to treat inflammatory diseases.
Karo Bio CEO Fredrik Lindgren said to date the collaboration has generated several novel compounds that may have potential as drug candidates.
"We have decided to extend our collaboration for another year to allow us to continue to combine the strengths of Karo Bio and Zydus Cadila to jointly study these further," Lindgren said.