The Hindu Business Line : Sandoz to build on India advantage, plans further investments

IT is an open secret that the world's largest players in generic medicines have their designs on India. So when Sandoz's Chief Executive Officer, Dr Andreas Rummelt, makes two business visits to India in the six-odd months since he has taken charge, his intentions are quite clear.

Sandoz is a Novartis company and in February, it formalised deals to acquire 100 per cent of Hexal AG, a privately held generics company in Germany, and a 67.7 per cent stake in Eon Labs, a US generics company. The closing of these transactions will make Sandoz the undisputed global leader in generic medicines. And into this global generics game-plan fits Sandoz's India strategy.

"This visit is to discuss our strategy in the local market," Dr Rummelt told select media at a late evening interaction on Wednesday. India has its capabilities in manufacturing and process development, he said, and indicated that investments will be made in these areas.

Significantly, Sandoz is setting up a new multipurpose plant at its recently acquired site in Mahad, Maharashtra. The Mahad plant belonged to Novartis, which used it to manufacture the anti-tuberculosis bulk drug rifampicin.

In January, the Novartis board cleared the proposal to sell the rifampicin business and facility to Sandoz for about Rs 30 crore. The new plant at the existing site would be operational in 2007, said Dr Rummelt.

Only last year, Dr Rummelt's predecessor had opened a new manufacturing facility at Kalwe in Navi Mumbai. This was Sandoz's third plant in India; the company has two other units at Thane and Navi Mumbai.

The Kalwe plant has got the US Food and Drug Administration's approval and products for the US market can be produced from here, he said.

At a time when multinational companies are rationalising their plants in India, the fact that Sandoz is adding manufacturing capacities reflects the company's strategy to utilise the India-advantage, an analyst observed.

Elaborating on the fate of the Mahad plant, Dr Rummelt said a decision was yet to be taken on whether to continue the rifampicin business.

Mr Jagdish Dore, Sandoz's Managing Director in India, added that the plant continues to produce rifampicin and that they would review the decision as they go along. "We will produce it so long as it is viable," he said.

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