Sawai Pharma ramps up manufacturing in response to Japan's call for more generics

In May, the Japanese government said it would raise its target for the use of generics in public reimbursement to 80% or 90% by 2017--even as it lags an earlier target of 60% this year.

That set Japan's Sawai Pharmaceutical into high gear, with the Nikkei Asian Review reporting plans to ramp up generic drug manufacturing capacity by 80% to 18 billion tablets annually by fiscal 2020.

Sawai President Mitsuo Sawai said at a press conference this week that as the country's largest generics producer he has a job to do, Nikkei reported.

Sawai President Mitsuo Sawai

"The level of generics production that the industry currently has planned will not be sufficient to meet government goals," Nikkei quoted Sawai as saying.

This could also fit into Japan's plans to boost overall healthcare investment, as the company may open a new factory and buy facilities from other drugmakers, Nikkei reported, adding that investment plans are at ¥44 billion ($355 million) over the next three years.

In June, Japan released healthcare plans covering the next two decades that aim to blend cost savings and innovation as part of broader national goals to revive the deflation-hit economy.

The government hopes a burst of funding for innovative research in stem cells and other cutting-edge therapies and a push to use more generic drugs works out a magic formula that will pay for a demographic mountain just down the road.

Japan's population will see one in three people reaching age 65 or older in 2035, the Japan Times noted in a recent story.

But Sawai Pharma is ahead of the game. It started its expansion in April, buying Mitsubishi Tanabe Pharma's Kashima factory in Ibaraki Prefecture, Nikkei said.

- here's the story from Nikkei Asian Review