Novartis may form JV with Li Taka Pharma

Swiss drug maker, Novartis, may use the manufacturing facility of the Pune-based Li Taka Pharmaceuticals Ltd (LPL) to source its global requirement, after January 2005.

The multinational conglomerate is likely to sign a joint venture with LPL for this purpose.

LPL, at present has a tie up with Herbalife International India Private Ltd (HIIPL), the Indian arm of Herbalife, for the manufacture of dietary food supplements at its plant at Vadgaon Maval, Pune.

"We are already supplying our formulations to Novartis, as the company has bagged the prestigious World Bank sponsored order of Rs 22 crore through Novartis, and has successfully executed the order in eight months. In appreciation of this efforts, the company has got additional orders of Rs 5 crore, which are being executed under the supervision of Novartis India Ltd," Nainish Bora, director, commercial, LPL told Business Standard.

"We may form a JV with Novartis to manufacture formulations for them at our state-of-the-art plant. Efforts are also on to make the Vadgaon Maval-based plant a manufacturing hub for outsourcing the global requirements of Herbalife International," he added.

The company is planning to double its authorised share capital to Rs 20 crore, to fuel its next level of growth in the international arena. LPL has planned a rights issue of Rs 10 crore in the third week of December.

"Excellence in manufacturing and the state-of-the technology has always been the major strength of our company. The research and development (R&D) department of the company is very strong, which is recognised by the Department of Scientific and Industrial Research, as well as University of Pune for doctoral studies," said Bora.

The government of India has already subscribed to the new patent regime under General Agreement on Trade and Tariff (GATT), which will be effective from January 2005 and is expected to give boost to the contract manufacturing actives of the company.

The company will also be in a position to exploit the new Pharma Bill to its advantage, since its has been making huge expenditure on developing infrastructure required to meet the quality standards of multi-national companies (MNCs), the official said.

The company has reported a turnover of Rs 55 crore in the last financial year and targets a turnover exceeding Rs 70 crore by the end of the current financial year, and is also considering the potential of the exports market and the volume of contract manufacturing turnover.

LPL officials are confident that the company will touch a turnover of Rs 200 crore in the next three years. The company manufactures over 10 crore tablets per month, four crore capsules per month, 12 lakh bottle of liquid orals per month, and 100 tonne of powder and food supplements per month.