India's Aurobindo buys, boosts sterile capacity

India's Aurobindo Pharma sees the sterile injectable business as being a growing part of its revenues and over the next couple of years expects to nearly quadruple capacity at one new unit, even as it buys some additional capacity.  

Aurobindo Pharma currently manufactures injectable drugs at two of its manufacturing facilities located near Hyderabad. According to The Economic Times, Aurobindo Managing Director N. Govindarajan told reporters at the company's annual meeting last week that the newest unit is producing about $2.5 million to $3 million worth of sterile injectables a month. It has applications for 31 more drugs. Govindarajan said he expected the facility to be producing $8 million to $10 million worth of product per month in the next 6 to 8 quarters.

But Aurobindo is also buying some additional capacity, in both sterile injectables and nonsterile products. The board gave its blessing to the company's investing Rs 15.6 crore ($2.6 million) to buy a 60% stake in a new manufacturing facility that Celon Laboratories is building to make hormonal and oncology drugs. It will invest another Rs 32.3 crore ($5.3 million) to expand that plant over the next year, ET reported. The board also approved the company's upping its stake in Silicon Life Sciences to 75%. That company manufactures nonsterile penems.  

Aurobindo likes the sterile injectables business, and in an effort to realize all of its potential, the company last week said it had spun those operations into a separate subsidiary. It also asked a committee of independent directors to explore "strategic alliances and acquisitions." The directors are supposed to report back in 60 days.

Other companies see the potential in the market as well. Jordan-based Hikma is building up its business, and Teva Pharmaceutical Industries ($TEVA) has expanded its injectables capacity at a plant in Hungary. Hospira ($HSP) has upgraded plants in the U.S. to address quality problems but has also bought a modern API plant in India to feed its operations. In March, the medical technology company Becton Dickinson ($BDX) started manufacturing its first FDA-approved sterile injectable product at a plant in North Carolina but said it would roll out 20 to 30 more drugs over the next several years.

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