India's second-largest pharmaceutical company Cipla is in talks with bio-technology firms in China for buying large-capacity manufacturing facilities along with latest fermentation technology.
Amar Lulla, joint managing director, Cipla said, "We are looking at some bio-tech manufacturing facilities in China and other overseas locations, the due diligence for which, is currently on."
However, he did not reveal the size of investment and the time frame for the proposed Chinese acquisition.
In April this year, the Rs 3,000-crore (Rs 30 billion) firm had raised $170 million (about Rs 7.82 billion) through an issue of global depository receipts, envisaging few key investments in the current financial year.
The company has been looking at acquisition opportunities, particularly in the niche business segments to enhance and expand its newer business segments such as bio-technology.
Cipla, which has been in the chemistry-based medicine manufacturing and marketing segment for almost seven decades in India, plans to enter the bio-technology space for the first time.
It had recently tied up with Avestha Gengraine Technologies (Avesthagen) for a biopharmaceuticals development programme.
With this collaboration, Cipla would sponsor the research and development programme, which would be undertaken by Avesthagen.
Under the agreement, Avesthagen will focus on research and product development and clinical trials, while Cipla will engage in the scaling-up, marketing and distribution areas.
The Avesthagen-Cipla joint project was mainly to focus on recombinant products or bio-generics that are already present in the Western markets and the first segment that is being looked at is the auto-immune segment. This would subsequently be extended to the cardio-vascular disease and cancer segments as well.
Cipla sources said that the first few biopharmaceutical products from the joint project are expected be out in the market shortly. With the Chinese acquisition, the company is mainly looking at the manufacturing capability and technology to scale up the production.
With the proposed capacity expansion in the country, Cipla also plans to set up a large export oriented unit for manufacturing active pharma ingredients and drug formulations in Kurkumbh and another EOU in Bangalore for APIs.
The company plans to set up a formulation facility in the special economic zone in Goa. The total investment in these capacity expansion is expected to be around Rs 600 crore (Rs 6 billion).
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