Teva Pharmaceutical Industries ($TEVA) has put some expansion projects on hold while it looks to streamline its manufacturing processes as it reshapes its destiny over the next several years. That interlude hasn't stopped progress on what is termed the world's largest over-the-counter (OTC) manufacturing facility.
A new plant in Sanand, near Ahmedabad, India, will serve PGT Healthcare, the consumer health joint venture established in 2011 between Teva and Procter & Gamble ($PG). The venture is combining P&G's well-known OTC products like Vicks and Pepto-Bismol with Teva's consumer cold, cough, pain and digestive meds.
The joint venture has broken ground on the $89 million plant, The Economic Times reports, which is expected to be completed in two years. The facility will kick off with liquid, oral solid dosage and inhaler products, including P&G's Vicks line. The production will be in addition to what P&G gets from a network of Indian contract manufacturers currently making some of those products. The facility is initially targeted at Asian markets, but a modular design can allow for expansion as demand grows globally, The Economic Times points out.
Under the joint venture, Teva also assumes control of several P&G manufacturing facilities in the U.S. and will handle supplying all the JV's markets, including P&G's OTC business in North America.
In December, Teva CEO Jeremy Levin set out his 5-year blueprint to diversify the company's product lineup, expand geographically and cut up to $2 billion in costs. Levin wants to ratchet back on spending while bringing in new revenue to make up for the impending loss of patent protection on its top-selling drug, Copaxone. A big part of that cost-cutting effort involves overhauling Teva's manufacturing and supply-chain operations to make them more efficient. Some production projects have already been shelved while that part of the equation gets worked out, including a $300 million warehouse and IT center in Philadelphia.
- read the Economic Times story