Sandoz sets up third plant in India

Sandoz, the generics division of Swiss drug maker Novartis AG, has set up its third facility in India for $13 million.

The plant is expected to be the most competitive among the multinational's units worldwide.

The new plant, which is situated in Kalwa near Mumbai, will begin tests and trial runs in July, while commercial production is likely to begin early next year, he said.

Its two other plants are at Kolshet in Thane and Turbhe in Navi Mumbai. Sandoz expects to increase its present employee strength of 1,000 in India by 200 with the setting up of the new plant.

The plant will supply tablets and capsules worldwide. However, the drugs will mainly be exported to the US and European markets.

"Though right now I cannot calculate the comparative advantage of the new plant in Mumbai, it is not a secret that the Indian unit is likely to be the most cost competitive plant we will have worldwide," said Christian Seiwald, chief executive officer, Sandoz GmbH.

Seiwald also said that Sandoz is open to acquisitions as and when the right opportunity arises.

"Our company is mainly looking at organic growth, but we are also screening the market. At the moment Indian stocks are trading at extremely high prices when you compare the ratios in the US," he said.

The company has plans to increase its output gradually from this plant as per demand. "We can increase the production capacity up to five billion units per annum at the existing plant facilities. However, we will wait until this plant begins full production and evaluate the market requirements if we need to increase production capacity," Seiwald said.

Sandoz has filed an application with the US Food and Drugs Administration for pantaprazole. The drug, which is currently patented in the US, will go off patent in February 2005.