Hyderabad an ideal place for pharma companies

Hyderabad: For $1.3-billion Chemo Group, the City of Pearls presented multiple opportunities and advantages. The Madrid, Spain-based pharmaceutical major with operations across 40 countries chose Hyderabad as location for its new formulations plant two years ago and established a Rs 100-crore facility recently.

“The city offered multiple opportunities for us. Hyderabad is a place where lot of talent is available for pharma industry. I would say it is one of the top pharma hubs in the country after Mumbai and Ahmedabad. It’s a good place to be. We established a commercial office in the city in the past.

We will now have our factory here,” Lucas Sigman, Managing Director-Industrial Business, Chemo Group, told The Hans India. He was in the city
recently to inaugurate the new plant.

Asked whether his company selected the city because of cost-advantage it offered, he said that the availability of talent tilted scales in Hyderabad’s favour. “Availability of talent is more important than the cost factor. In Hyderabad, we can do things quicker as more resources are available.

It is not possible in other places to find people in a short period of time and set up operations including R&D. It’s possible here as there are lots of pharmacy colleges and students. The talent pool is very very attractive. Of course, cost efficiency is also there,” Sigman explained.

Founded in 1977 in Barcelona, Spain, Chemo, a part of Grupo Insud which is into life sciences and agribusiness, had entered India way back in 1998 and currently has commercial offices across multiple cities. However, this is first time that it established a manufacturing unit in India.

The company plans to invest nearly Rs 500 crore in its Hyderabad facility where it will produce oral solid dosage forms including tablets, caplets, hard gelatin capules and pellets, for export markets. It invested Rs 100 crore in the first phase and remaining investment would come in two more phases over next four years. It will eventually employ 350 high-quality professionals.

Sigman said industrial climate was good in India as well as in Telangana. “We received approvals very fast. The Telangana government has been very efficient in granting the approvals for our plant. Our experience till now is excellent”.

He further said the Hyderabad facility would focus on R&D. “We have a beautiful R&D lab here,” he however that there were no plans to focus on molecules. “Our focus area is formulations and that’s what we will do here. Focusing on molecules is not a strategy for us as a company. We work on formulations and APIs,” he said.

However, this is not the first time that the Spanish company has established its factory outside Spain. It already has plants in Argentina, Turkey, Italy. Chemo Group has total of 15 plants, employing about 6,000 people.

The Spanish pharmaceutical major gets a good chunk of its revenues from Mexico which is its largest market. “Our key markets are Latin America, the US and Europe,” he said.

On increased regulatory scrutiny in the US, he maintained that that was nothing new for Chemo Group. “We are used to that as European markets have rigorous regulatory regimes. We maintain high quality standards. We don’t see any reason why our products can’t compete in the US markets,” he said.

By P Madhusudhan Reddy