Micro Labs is gearing up for an Initial Public Offer(IPO). The proceeds from the IPO would be used for faster regulated market entry and other in-house expansions. While the company is already working on the modalities of planning for the public issue, the timing of the launch is not disclosed.
As a part of its well-planned strategy and a focused approach to offer the global pharmaceutical majors its expertise in formulation research, Micro Labs has gone ahead to invest Rs. 50 crore to set-up two R&D facilities at Mumbai and Chandigarh. Both these Centres for Formulation R&D at an investment of Rs. 25 crore each would be ready within the next 15 months to specifically address the contract research assignments from international customers.
Going hand-in-hand with the research unit implementations, Micro is also scouting for acquisitions in Europe. It has also set up two units in South Africa with local partners for the production of formulations (tablets).
The global focus of contract research, acquisitions and units abroad would strengthen the company in terms of faster growth, higher profitability, increased revenues and business expansions.
For its two Centres for Formulation R&D, around 100 scientists would be hired. The company preferred Mumbai and Chandigarh because of access to quality and experienced scientific skills. Mumbai is already the hub of pharma enterprises and there is a ready availability of expertise. Chandigarh was opted because of the presence of National Institute of Pharmaceutical Education and Research (NIPER). Another reason was the accessibility to the company's formulation unit at Baddi in Himachal Pradesh where scientists would deal with pilot trials of products to the US market.
The Micro Labs Advanced Research Centre at Kudlu in the outskirt of Bangalore is a centralized and exclusive facility for in-house research set up at a cost of Rs. 35 crore.
Coming to its new USFDA plants, the two units are expected to be commissioned in early 2007. One is the Rs. 35 crore tablet capsule facility at Baddi with a 300 crore per annum capacity. The other is the active pharmaceutical ingredient (API) unit in Bommasandra, Bangalore with a capacity of 60 tonnes per annum which is for captive consumption of molecules in the regulated market and a backward integration strategy for the company to reduce input costs.