The men worked for a herbal medicine company and were testing their treatment — a mix of nitric oxide and sodium nitrate — at a home in southern Chennai city.
K Sivanesan, 47, died on the spot, said local police chief Ashok Kumar.
His colleague Rajkumar was recovering from the poisoning.
Kumar said Sivanesan bought the chemicals from a local market and developed the formula after conducting research on the internet.
There are no approved medicines or vaccines for treating COVID-19, triggering a global race for a new drug for the disease that has killed nearly 300,000 people.
Nearly 60,000 cases have been detected in India, which has imposed a drastic nationwide lockdown in an effort to halt the spread of the disease.