With drug manufacturing expanding in India and Asia, another manufacturing supplier is building a plant there to feed off the growth, expecting emerging countries and new products like biosimilars to sustain demand over the long haul.
The India division of West Pharmaceutical Services ($WST) is starting on a 10-year building plan to create a 37,700-square-meter packaging complex in a special economic zone (SEZ) in Sri City, India, its first in that country. The Lionville, PA, company intends to get the plant approved by the FDA and Canada's Bureau of Pharmaceutical Sciences.
West says the company is seeing big demand there and being close to customers will allow West to cut lead times and costs.
Warwick Bedwell, West's president of pharmaceutical packaging systems in the Asia Pacific region, says India and China are naturally creating demand, while other markets in the region, like South Korea, Australia with its biotech base, and Indonesia and Vietnam will keep the momentum growing.
"Asia is a diverse marketplace and the mix depends on the country," Bedwell tells FiercePharmaManufacturing via email. "Western pharmaceutical multinationals are moving their production to Asia to satisfy the local demand, but local players are also looking for new opportunities across Asia and in the United States and Europe."
In terms of trends West sees in the region, Bedwell says, "Because of a less restrictive regulatory environment in some countries and dominant local players, biosimilars should penetrate markets faster and deeper in Asia than in developed Western markets."
The first phase of the packaging complex consists of a 15,300-square-meter metal seal assembly and compression molding facility that will produce metal and elastomeric pharmaceutical components for injectable drug packaging. Construction begins this month and production is expected to go online in the first quarter of 2014.
West plans to be making a variety of its standard elastomeric components a year later and ready-to-sterilize components beginning in 2016. The company says the final floor plan of the plant and offices is slated to be 37,700 square meters and be wrapped up in 2023.
While there have been some indications of late that Western companies may have overestimated just how much of the growth in Asia and India they can expect to suck up, the forecasts that growth will outpace the West continue to be offered up. A recent report by the IMS Institute for Healthcare Informatics pegs growth in emerging markets at $157 billion in the next 5 years. At $345 billion, emerging markets would then account for about a third of global sales.
Eli Lilly ($LLY), Pfizer ($PFE) and many others are building plants or alliances in Asia, India and South America and suppliers are coming along for the ride. For example, pharmaceutical glass and plastics manufacturer Gerresheimer in April picked up controlling interest in a pharma glass company in India.
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Editor's note: This story was updated to add comments from West's Warwick Bedwell.