Neuland Laboratories has plans to invest more than Rs. 300 crore and it is expected to come out with 100-125 new molecules in the next 3-4 years.
“We are a major active pharmaceutical ingredients (API) manufacturing company. At present we have just crossed Rs. 500 crore, and in the coming next 4 years we are aiming to double our revenues to Rs. 1000 crore by investing in quality, environment safety and new products,” informed Viswanathan, chief finance officer, Neuland Laboratories.
Hyderabad-based Neuland Laboratories is an API major and is currently working on 65 new molecules. The company is having long term plans of investing in new molecules and it is expecting to discover at least 100-125 molecules in the next 3-4 years. “Out of 3600 prospective molecules available globally, 1400 molecules are already dead, we are left with only a space of 2400 active molecules among which we are targeting to crack at least 100-125 molecules in the next 4 years ahead,” says the CFO.
With multiple products in its space, Neuland is a leading manufacturer and exporter of cardiovascular, hypertension and dietary products. More than 80 per cent of its products are exported to regulated markets like USA and Europe.
According to Viswanathan, the API business is highly competitive across the globe. China is faring well in API business not only because the country is altogether following a different model of business and but also it is highly supported by its government. Not just that the cost of labour and productivity of its people is also very high when compared to Indians. In India, the API industry has to face lot of hurdles like red tapism and long period for product registration and new licencing of products, tough and unclear environmental regulations, lack of government support, non-availability of skilled people, lack of quality power, etc. “we cannot say that the production cost of Chinese API’s is cheaper than India, but they are following a different business model of bulk manufacturing and has a long strategy of capturing the world markets in all segments,” informs the CFO.
Neuland which has its main focus on APIs is also concentrating its energies on contract research and manufacturing (CRAMS) servicing its customers in custom manufacturing solutions. The company not only helps innovator pharma companies but also provides services to biotech companies with its diverse technology platforms.
In the last quarter the company had earned a profit of Rs. 25 crore and is looking to double its sales by next year. “We will continue to invest in quality, environment safety and in products which give us margins. We are building our capacity in our existing plants and may invest in new units in AP, Telangana and Gujarat based on the policy initiatives by the respective governments,” says the CFO.