Rajasthan Antibiotics Limited (RAL) intends to raise Rs. 25 crore in the first tranche through private equity or venture capital route for its expansion. The public sector pharma unit has chalked out plans to set up a new production facility for cephalosporin to cater to the domestic market.
“The company will upgrade its existing R&D facility which is recognized by DSIR. We expect to achieve annual revenue of Rs. 500 crore by 2022. Our R&D and production unit at Bhiwadi also envisages an expansion with this fund infusion . We are adding 2 new Lyophilisers with higher capacities that will help in creating an additional capacity of 180 MT per annum. It should provide an incremental revenue of Rs. 60-70 crore per annum. The new Lyophilisers will augment the capacity by another 40-45 MT per annum”, Ashish Pruthi, chairman and managing director, Rajasthan Antibiotics Limited told Pharmabiz in an email.
The company is known for two active pharmaceutical ingredients (APIs) ampicillin and omeprazole for which the response has been outstanding in the domestic and international market. “We are ready to embark into the markets of Brazil, Europe, Mexico, and Columbia, besides making a good impact in Latin America”, he added.
The current API scene in the country is bright and going forward there is considerable potential too. Quoting the McKinsey report, Pruthi stated that by 2020 India’s pharmaceutical sector will touch US$ 45 billion The API industry has seen smooth growth and registers a CAGR of 10.76 per cent.
For APIs, India is ranked third after China and Italy. The present economic crisis in Europe will eventually benefit the Indian industry and GST will further bolster the growth of the domestic market. The big strength of India API industry is quality labour at competitive cost and improved infrastructure, he said.
Although India continues to import APIs and intermediates from China despite its capability, the RAL chief sees the need for the country to comprehend its potential. “Under the Make in India programme government should promote aggressively to lure global investors and venture capitalists because we still lack in funding to fully exploit our strengths”,he said
Even on the registration fee for a Chinese API in India which is Rs. 2,000 as against an Indian API registration in China at Rs. 20,000. The higher registration fee for Chinese API would do more damage to our pharma sector than to China, he pointed out.
Katoch Committee report for the API sector was balanced and futuristic. Therefore, there is no need for a second thought in its implementation.
Recommendations in the report will definitely induce growth. The Pharma Parks will now give a boost to the sector on similar lines that of the SEZs and IT hubs.
Compliance with current good manufacturing practices (cGMP) by US FDA, more investment on R&D activities, mergers & acquisitions with benefits from GST are the imminent trends in Indian pharma industry today.
However, the Indian API industry is lacking in terms of R&D investments, patent registration, and advanced supply chain management. We have to work more in these three areas to expedite the growth from the international market. GST too translates into profitability and promising development, said Pruthi.