Syngene to spend $100 m on new plant at Mangalore SEZ

By: |
Bangalore | August 29, 2015 3:40 AM

Syngene International, a contract research arm of biotech major Biocon, has firmed up plans to diversify into contract manufacturing.

Syngene International, a contract research arm of biotech major Biocon, has firmed up plans to diversify into contract manufacturing. It is planning to set up a multi-product, multi-client contract manufacturing facility at Mangalore special economic zone (MSEZ) at an investment of $100 million (around Rs 660 crore).

The company, which counts global pharma giants such as Bristol Myers Squibb, Abbott Laboratories and Baxter International as its clients, is currently undertaking limited manufacturing at its research cum manufacturing facility at Biocon Park in Bengaluru.

“We have been developing molecules with our partners at Bengaluru and some of them have reached the stage of Phase-2 and Phase-3, and require commercial manufacturing. To meet our customers’ needs we are setting up a new greenfield manufacturing facility at Mangalore SEZ,” Manoj Nerurkar, chief operating officer, Syngene International, said.

He said the company has acquired 48-acre land at MSEZ, where it will set up a new facility. The company is in the process of securing approvals and start construction in the next fiscal. It will be operational by FY18 end. It will employ around 500 persons including scientists.

At its Bengaluru plant, Syngene is producing at a small scale to meet clients’ requirements for phase-2 and phase-3 trials. Once the Mangaluru facility comes up, it can meet their large-scale commercial requirements, he said. The new facility will have a capacity to produce 500 kilo litres of molecules in the form of powder, which will be the basic raw material for formulations and tables or injections depending on clients’ needs, he said.

Apart from contract manufacturing for its clients, Syngene also aims to seek opportunities which are independent and eventually become an independent manufacturer of formulations and tablets, Nerurkar said.

Without naming the clients due to confidentiality, he said the company would cater to eight out of top ten global pharma giants in the US, North America, Europe and Japan from Mangaluru facility

The product made at the new plant could be used for several disease areas such as oncology, gastro intestinal disorders, neuro sciences, cardio vascular, diabetic and infectious diseases among others depending on the client’s requirements, Chinappa M B, President, Finance, Syngene International said.

He said the company would use internal accruals and borrowed funds to set up the new facility. “Investment is through internal accruals and some borrowings from banks. Overall, as a corporate entity, we are cash surplus.

Going forward, we will go for borrowings from banks for building and equipment, while the land cost is met through internal accruals,” Chinappa said.

Right now, Syngene produces molecules to meet the Phase-I, II and III trials from the existing site in Bengaluru, which was expanded recently to support early stage commercialisation over the next two to three years. Mangalore plant would support late stage commercialisation of existing products and early/late stage commercialisation of new products, he added.

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