Serum Institute of India to invest $160M in new plant

Serum Institute CEO Adar Poonawalla

The vaccinemaker Serum Institute of India, which jumped into the biosimilars race in July, is expanding its manufacturing network in both India and the Netherlands. The company says it will invest about $163 million for a new facility in its home country.

"We will be investing around Rs 1,000 crore in Pune to set up a vaccine manufacturing plant," Serum Institute of India CEO Adar Poonawalla told the Economic Times.

The company, which claims that 65% of the children immunized in the world receive at least one vaccine manufactured by it, expects to have the new facility up and running in three years. The facility will manufacture vaccines for pneumonia, rotavirus, dengue and other diseases. Poonawalla told the newspaper the company will pay cash to build the new plant.

"It will be through internal accruals," Poonawalla said. "We don't believe in taking much debt to fund growth and expansion. That is why our focus is on organic growth and small acquisitions."

With facilities in India and the Netherlands, it says it currently has the capacity to produce 1 billion doses a year. The company bought Bilthoven Biologicals from the Dutch government in 2012, giving it the technology to make an injectable polio vaccine. The company has spent about €200 million ($255 million) expanding and upgrading the facility since then, Poonawalla told the Economic Times.

One way the drugmaker will use some of its capacity is to provide the manufacturing for a deal with Australian biotech NeuClone to bring 10 monoclonal antibody biosimilars to market in the next 8 years. The first two candidates are expected to be ready for Phase III trials in 2017, after which the alliance will move two drugs a year to late-stage trials.

Serum Institute's disclosure adds to a burst of news in vaccine production in the last week. Australia's CSL agreed to pay $275 million for Novartis' ($NVS) influenza vaccine business, getting its recently FDA-approved plant in Holly Springs, NC, in the deal. Japan's Fujifilm is buying an interest in Texas-based Kalon Biotherapeutics, which is working with GlaxoSmithKline ($GSK) on a new government-backed vaccine plant in Texas. Fujifilm says it will buy the rest of the company if certain milestones are hit.

- read the Economic Times story