Hospira ($HSP) has a lot going on related to manufacturing, but it seems all of the attention is focused on improvements under way at its troubled plants in North Carolina and Texas.
Indeed, so much time was spent during last week's earnings call on Hospira's work to address FDA 483 complaints at plants in Rocky Mount, NC, and Austin, TX, that little was devoted to significant manufacturing expansions in India. The Rocky Mount plant, which closed in December, resumed production in January, and Hospira expects it to hit 60% to 70% production levels by the end of the year.
According to financial filings, the generics injectables maker is in the midst of an expansion of two facilities in India that will help it meet what it hopes are growing future demands. The company began work in 2011 on a Vizag, India-based facility that will manufacture specialty injectables. The expansion is utilizing land leases it got in acquisition of the generic injectable pharmaceutical business of Orchid Chemicals & Pharmaceuticals Ltd. The $381 million purchase of the Orchid business in 2010 got Hospira a beta-lactam antibiotic formulation manufacturing complex and pharmaceutical R&D facility, as well as a portfolio and pipeline of generic injectable dosage-form products. But Hospira also bought some leases that Orchid Pharma had been holding for its own anticipated expansion in Vizag, a major port city on the southeast coast of India.
Hospira expects products will be rolling out of the Vizag facility in 2014. It says in its filings it spent about $80 million on the facility in 2011 and expects to invest another $105 million to $125 million in 2012.
In addition, the company is working over the next several years to qualify and validate manufacturing for oncology compounds at its joint venture, Zydus Hospira Oncology Private Limited, an Indian pharmaceutical company. It said it spent $3.8 million on this effort in 2011 and anticipates investing $22 million to $28 million in 2012.