Granules India has gradually transformed its strengths from OTC monographs to OTC-ANDAs to prescription products. With its recent joint venture with Hubei Biocause Heilen Pharmaceutical Co Ltd of China, the company proposes to manufacture and sell pharmaceutical APIs, starting with ibuprofen. Neproxin is the next priority area. Granules has already signed MoU with Biocause to acquire 50 per cent stake in the joint venture entity.
C Krishna Prasad, managing director of Granules said, the all-cash deal will be completed by January 12, 2007. The transaction is being funded though a mix of debt and equity. The value of the deal was not disclosed.
The estimated $8.25 million assets of Hubei Biocause, including manufacturing assets worth $6.25 million located in China will be transferred to the JV company, christened, Granules Biocause. Granules Biocause is expected to clock in a turnover of $25 million by the end of second year of its operations.
Biocause is the fourth largest ibuprofen manufacturer and exports across the world. It operates with a capacity of 3,800 metric tons and four billion tablets and supplies ibuprofen substance to over 45 countries. The company received Certificate of Suitability (COS) from EDQM for bulk Ibuprofen Drug Substance in 2003.
Ibuprofen is the second largest OTC product worldwide and the global capacity is close to 28,000 metric tons. Global market growth of ibuprofen has been about three to four per cent year on year. Another advantage with ibuprofen is that it can be sold as both prescription and OTC product. Granules is also eyeing opportunities in producing finished dosages of ibuprofen, Prasad added.
In the coming years, Granules will continue to focus on large scale APIs and in the prescription products, the company is primarily looking at contract development and contract manufacture and achieve backward integration through partnerships. With its six billion tablet (with provision to expand up to 12 billion tablets) facility expected to commission by March 2007, the company is expecting over 50 per cent growth from 2008.