Pfizer taps Mylan manufacturing muscle to hit Japanese generics

Mylan is putting its manufacturing muscle into an agreement with Pfizer ($PFE) so the two can jointly attack the Japanese generics business.

The companies already have a relationship but now have teamed up to make and sell 350 off-patent drugs there. Mylan ($MYL) will handle the manufacturing and Pfizer will use its well-known brand to underpin the marketing.

Mylan, one of the largest makers of generic medicines in the world, already has significant operations in Japan and the rest of Asia. It claims on its website that its India-based subsidiary, Mylan Laboratories, is one of the world's largest active pharmaceutical ingredient (API) manufacturers, making Mylan "one of only two global generics companies with a comprehensive, vertically integrated supply chain."

According to information provided by Mylan, the generics maker's Asia-Pacific (APAC) operations already have an oral solid dose capacity of 17 billion annually, which it expects to grow to 50 billion doses annually by 2016. Its API reactor capacity in APAC is 3,000 kiloliters, which will expand to 4,500 kiloliters in the same time frame. Globally, it has a 45 billion annual dose capacity. Its global drug manufacturing network includes a plant in Kawagoe, Japan, as well as two drug plants in India and one in Australia. It has 6 API plants in India and one in China.

"We believe the collaboration will result in a powerful generics platform that ... will be a leader in Japan in terms of scale, scope and quality," Pfizer's established-products chief, Albert Bourla, said in a statement.

The rationale for the deal is pretty obvious. While Japan is the second-largest pharma market, it is only the sixth-largest generics market on the globe. That is expected to change as an increasingly cost-conscious government works to ratchet up use of more affordable generics.

- get the joint press release