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Ahmedabad-based Torrent Pharmaceuticals is planning to raise its spending on research and development (R&D) by at least 50 per cent, and stretch it to about eight per cent of its turnover.
It also expects to launch around 10 new drugs in the US market this financial year.
A spokesperson said, “R&D costs will scale up as we are confident in our long-term business prospects in our selected geographies and are investing in building a pipeline (of drug launches).”
Torrent is one of the few Indian pharma companies to have met all compliance standards of the US Food and Drug Administration (FDA), the sector regulator there.
Its R&D spending in 2015-16 was up 28 per cent, from Rs 191 crore the previous year, to Rs 246 crore. Much of the R&D scale-up is to develop products for the highly regulated markets. Of the 10 product launches planned this year for the US, most would be in the CNS (central nervous system) and cardiovascular segments.
In a recent report, rating agency CRISIL said with the slowing growth in generics, Indian pharma companies must look at other avenues for sustaining growth such as new drug development and bio-pharmaceuticals.
It noted Torrent’s R&D focus was currently on cardiology and obesity-related drugs. Unlike Dr Reddy’s and Sun Pharmaceutical, which derive close to 60 per cent of their revenue from the US market, Torrent draws around 30 per cent. It had a 128 per cent year-on-year jump in its US business during the fourth and final quarter of FY16 to Rs 514 crore, primarily on the back of generic versions of drugs Abilify, Nexium and Detrol.
Its unit at the Dahej Special Economic Zone in Gujarat’s Bharuch district, commissioned late last year with an investment of Rs 650 crore, obtained the FDA’s Establishment Inspection Report in March this year. Prior to this, the unit had also got approval from the European Union. It was set up to cater mainly to regulated international markets such as the US, Brazil and Germany. It is the third of Torrent’s five units to get FDA approval, besides Indrad in Gujarat and Pithampur, MP.
The first phase of the Dahej plant added a capacity for 7,500 million tablets and capsules, apart from 25 tonnes per annum of active pharma ingredients (API). The second phase of development at this 70 acre site is expected to take the capacity up to 14,000 million tablets and capsules apart from 80 tonnes per annum of API. The second phase is expected to start soon. There are plans to expand the Sikkim plant as well as set an integrated plant for API and formulations focussing on the oncology segment.
FACT FILE
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Torrent Pharma’s R&D spending in 2015-16 was up 28 per cent, from Rs 191 crore the previous year, to Rs 246 crore
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Torrent’s R&D focus is currently on cardiology and obesity-related drugs
- Most of the 10 product launches planned this year for the US will be in central nervous system and cardiovascular segments
