Shasun Chemicals and Drugs Ltd.(SCDL), the largest manufacturer of ibuprofen in the world, eyes the huge potential in Contract Research and Manufacturing Services (CRAMS) for further growth.

Shasun is on an endeavour to become a true one-stop shop for global pharma companies to outsource their development and manufacturing needs. By integrating its facilities in India and UK, the company is trying to offer the benefits of operations in both the countries to its clients. The company has aligned its facilities so that while research can be conducted in India, development in kilo labs and pilot plant can be conducted either in UK or India. Manufacturing of the final product can be done in UK after initiating the basic stages in India and the optimal mix could be decided based on the regulatory, IP and cost related issues, according to company sources.

The acquisition of the business of Rhodia Pharma Solutions by Shasun's wholly owned subsidiary Shasun Pharma Solutions Ltd., UK equipped the company to evolve as a technology based service provider than as a contract manufacturing and research provider. The acquisition is intended to cut down the cost components of research and production, which will be a plus point for the CRAMS strategy of the company.

Shasun bagged 10% of its sales revenue from CRAMS business, out of its Rs.370 cr turnover in FY 2006. The company expects a 40% growth in its CRAMS business in current financial year and is planning to add about four companies more in the CRAMS business in the current financial year, according to S Vimal Kumar, joint managing director, SCDL. With the introduction of new APIs, Shasun's CRAMS business has recorded standalone revenue of six percent in the first quarter of the financial year 2006-07.

The company is also setting up a multipurpose manufacturing facility at Vizag for enhancing its contract manufacturing and research activities. It hopes a steady leap in its contract manufacturing and API business, with plans to develop some new API products to meet the requirement of formulation needs of its multipurpose plant at Vizag.The production of new APIs is expected to set off once the pilot facility of the multipurpose plant is operational by Sep 2007. The backward integration of manufacturing the Active Pharmaceutical Ingredients (APIs) for these projects would be taken up in the Vizag plant.

The company is planning to set up a multi-product (non-dedicated) pilot plant facility, also focusing on Contract Manufacturing Services business, at Vizag, as the first phase with an investment of around Rs.45 crore, followed by a multi-product commercial facility with an additional investment of Rs 55 to 60 cr.

"The Vizag plant will produce APIs for the formulations prepared in our own plant, for the companies under CRAMS business. The geographical focus will be regulated markets and we expect regulatory approvals to be in place by June 2008," says Vimal Kumar.