China and India have gained a fair amount of capacity for manufacturing biopharmaceuticals of late. In years past, companies in the U.S. and Europe have thought of them as the most likely spots to outsource manufacturing work, but according to a new survey from BioPlan Associates, those two countries are losing their luster.
In PharmExec, BioPlan President Eric Langer says that although those two countries previously were the two most likely spots to outsource biopharmaceutical manufacturing, the company's 10th Annual Report and Survey of Biopharmaceutical Manufacturing Capacity and Production finds China in ninth place and India in fourth. The U.S. was the top spot picked, with Germany and Singapore filling out the top three. U.S. respondents put Singapore as their first pick, trailed by Germany, the U.K., China, and India.
Langer points out that the survey is heavily weighted to European drugmakers, so the drop is somewhat expected. Still, he notes rising regulatory issues as a key consideration, leading companies to think of traditional manufacturing hubs where they have more confidence in oversight.
He doesn't expect this trend to hold, however, as China and India are building up their capacity in biopharmaceutical manufacturing. Citing another source, he says that while the U.S. and Western Europe still dominate capacity, with 35.9% and 26.1% respectively, China and India are at 8.6% and 8.1%, respectively, and growing. Drugmakers, he said, are taking notice of that.
In a recent twist on the business model, Germany's Boehringer Ingelheim last month said it would spend nearly $45 million to build a biologics plant in Pudong, Shanghai. The company claims the plant should be finished by 2016 and will do contract manufacturing work for both Chinese and Western drugmakers. Other companies are also building plants there to do contract work or to manufacture their own products. Innovent Biologics said in November it had picked up $25 million from investors, including Eli Lilly ($LLY), to build a 90,000-square-meter plant in Suzhou, China. On the other hand, Novartis ($NVS) picked Singapore for a half-billion-dollar investment in biologics manufacturing. It is locating it alongside a traditional drugmaking facility it has in Tuas.
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