Chennai based Innvol Medical Ltd., engaged in manufacturing of a range of PVC bags for blood transfusions and infusion solutions, is to go for private placement to finance its $1.2 million expansion plans. The company will be setting up a state-of-the-art quality control lab and HPCL counters besides a new unit at the current facility to manufacture blood transfusion (BT) and infusion solution (IV) sets. A.C.Karthikeyan, vice chairman and managing director of the company, told Pharmabiz.com that the private placement would be completed by end of the current year.

However he maintained that the funds raised through private placement would not be used for financing the plasma fractionation unit that the company is contemplating to set up.

The BT and IV sets would be mainly for exports. The facility would manufacture 10 million sets of both the sets put together.

"We were flooded with requests from our clients to provide them with BT and IV sets and since it does not require us to make huge investments we are proceeding with the same," Karthikeyan maintained. "The quality control lab and the HPCL counter to be set up are in need to strengthen the company's standing in the export market. We are already a WHO GMP certified company but however we still had to improve the quality standards. The QC lab will ensure this which will help the company in getting a better hold in the overseas market," he added further.

Karthikeyan also hinted at the company going in for an initial public offering (IPO) in September this year. Besides raising money for future expansion plans, the IPO will help the company get listed on the Indian bourses. Karthikeyan however refused to divulge further details about the same.

Innvol Medical commissioned operations of its state-of-the-art manufacturing unit in Sriperumbudur near here with a licensed capacity of 7.2 million per annum, manufacturing five types of blood bag systems, viz. single bag, double bag, triple bag, transfer bag and quadraple bag.

Meanwhile the company is still keeping its option open on the technological partner who will help the company set up the plasma fractionation unit, that will be first of its kind in the country.

"We have kept our option open as far as the technological partner is concerned even though we are holding talks with Advant Biotech which has however not raised any objection," Karthikeyan maintained. Advant Biotech International Inc, a biotech consulting company incorporated for the specific purpose of providing turnkey consulting in the field of bio-medical technology is Innvol's technological partner helping in setting up the present unit. The plasma fractionation unit, according to Karthikeyan will have a cost outlay of $10 million and will cater solely to the domestic market.

In another development, a leading Indian pharmaceutical company has approached Innvol Medical for supplying of blood bags. It is stated that the Indian company, which has been contemplating entering into the domestic blood bag segment has done away with the idea of setting up a new unit owing to the huge cost and is now looking at outsourcing blood bags.