Unichem Labs lines up Rs 175 cr investment

Unichem Laboratories, a Rs 477-crore pharmaceutical company, has chalked out an ambitious multi-pronged strategy, which includes setting up formulation manufacturing facilities at one of the special economic zones (SEZ) in Indore, launching new products from its Brazilian and South African subsidiaries, expanding manufacturing capacities for both formulations as well as bulk drug plants located at Goa, Ghaziabad, Baddi (Himachal Pradesh), Roha and production of active pharma ingredients (API) from Pithampur.

Prakash Mody, chairman and managing director of the company, said at the company's 43rd AGM, that plans are on to invest around Rs 175 crore over the next two years in the manufacturing facilities.

However, it does not include the investment in SEZs and future acquisitions, he clarified. The proposed expansion will be financed through internal accruals and there will be no fund raising programme, he added.

Mody said, "It is too early to talk about the proposed SEZ unit, but all I can say is that we are looking at various options including pharmaceutical SEZs in Gujarat, Goa and Vishakhapatnam." This unit will be of international standards and will cater exclusively to the export market, Mody added.

With the completion of the upgradation programme by mid-August, this year at Pithampur Madhya Pradesh, "We expect to fulfill the API requirements of our customers whom we are not able to satisfy at present due to capacity constraints at the Roha facility. This will also help us strengthen our generic forays into developed markets, apart from exploring API opportunity in the global market," Mody said.

He added that the Roha facility has received USFDA approval and has started supplying generic APIs to the US market.

"It has received a number of orders from US customers. We expect to complete setting up two state-of-the-art formulations facility at Baddi by this financial year, facilitating our Goa and Ghaziabad formulations facilities to cater to the international market requirements," Mody said.

He further added that Niche Generics, UK, has booked profits of Rs 74 lakh for the year 2005-06, and that in addition to six products being sold in the African market, the South African subsidiary plans to launch more products in the current year. "Our focus is to launch generic and high-value branded generics in both South Africa and Brazil," Mody added.

"Unichem has established representative offices in countries like Kazakhstan, Russia and Ukraine, as we consider these as key markets and growth drivers for our company in the years to come. Of the 690 dossiers that we have filed, registrations or approvals for 377 dossiers has been okayed. In addition to this, we have also filed our first Anda for the US market," Mody pointed out.

As far as research goes, Mody said, "We are in the process of expanding our Bangalore-based biotechnology research centre with GMP pilot plant, which will help the company transfer the technology developed in our bio-research centre".

The company registered a net profit of Rs 25.20 crore against Rs.32.3 crore for the previous corresponding period.

However, last year the company had a one time gain of Rs 133.87 million on account of sale of property at Jogeshwari in Mumbai. It recorded sales of Rs 141.70 crore in the quarter as compared to Rs 122.3 crore for the corresponding period last year, a growth of 16 per cent.