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Strides to expand in Germany with niche products

Nandita Vijay, BangaloreThursday, May 11, 2006, 08:00 Hrs  [IST]

Strides Arcolab, one of India's leading exporters of branded generic pharmaceuticals, will focus on niche product opportunities in Germany which are difficult to manufacture. These include lyophilized injectables, suspension injections, hormones, and oncology. The Rs. 331 crore company which entered the German market for Generics in 2003, exports over-the- counter (OTC ) products, Vitamins and supplements in addition to RX products mainly in solid oral dosage form. However, the company intends to have its future focus in the country mainly in sterile parenterals. "With regards to the German market, we have multiple relationships in the country and the larger European Union market for generics. We are the manufacturer of choice for some of the leading German generic companies. Besides out-sourcing their manufacturing requirements, they also have entrusted us with formulation R&D for development and supply of products going off-patent in the future. What is most interesting for us is the out-licensing of generic formulations to German companies, leveraging our non-infringing processes and manufacturing technologies," Joe Thomas, president, business development, Strides Arcolab stated in an email interview. Germany, has the largest generic penetration among the European Union markets. Hence this market is important and Strides is making several filings in the European Union which addresses most of the key EU-25 markets, he added. In FY December 2005, Strides Arcolab registered export earnings to the tune of Rs. 314 crore and the revenues from the European Union was 4 percent but our estimates for the current year is about 10 percent of the overall sales. The president business development described the German pharma market as a fragmented, where even the leading generic companies had a small share. Right now, in Germany the smaller companies are either being acquired or are re-structuring to become Pan-European Union players. The larger companies are consolidating to achieve volumes of scale and acquiring a robust pipeline. In the wake of such a scenario, an emerging trend is that the smaller companies are looking to either partner or be acquired by companies bringing in funds to expand. For example Ranbaxy Laboratories Ltd, acquired the generic business of Romanian pharmaceutical company, Terapia SA and GlaxoSmithKline Plc's Allen SpA in Italy. On the regulatory authorities, he said that the European Agency for Evaluation of Medicinal Products, the EMEA (European Medicines Agency) is stringent.

 
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