Global bulk drug firms plan a local splash

By agencies   |   Monday, 06 June 2005, 19:30 IST
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MUMBAI: After global formulations and generics players, it’s now the turn of custom manufacturing companies and intermediates producers to look at India. Aditya Sapru, partner at consulting firm Frost & Sullivan, said, fine chemical manufacturers are considering working with India on a much larger scale and at much higher values. Currently, the extent of outsourcing in active pharmaceutical ingredients (API) is about 25 percent and is growing. Much of the interest to partner or invest in this segment of the pharmaceutical production chain is coming from European players. “Europe has been a strong player in the bulk business. Some European companies are now looking at Asian companies because these can provide higher efficiencies in process development in the traditional chemistries at a lower cost,” said Jayashri Kulkarni, director, healthcare practice, India operations at Frost & Sullivan. With global fine chemical and bulk drug manufacturers themselves eager to leverage the Indian advantage, the dynamics of the market is likely to see some amount of evolution. “We’re getting to a point where there is a rapid pace of innovation. There is also going to be differentiation at the vendor level,” said Sapru. According to Kulkarni, Indian players may have to identify a niche where they can operate in. “The niche segment will have to be some area that global companies would want to collaborate with Indian companies on,” she said. Robert Thong, managing director of a boutique consulting firm, NovaSecta, said that more mid-sized companies are picking out pieces that they want to focus on and outsourcing the rest. Even the Indian API companies have many opportunities to take advantage of. “Indian companies can provide custom synthesis and then move up the value chain to become co-development partners,” said Thong. “ Subsequently, they can be a development house for super generic APIs , and finally they could adopt the specialty pharma.

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