Ahmedabad-based Rs 800-crore Cadila Pharmaceuticals Ltd is all geared up for a large pie in the $665-million vaccine market in India. On Thursday, it formally announced a joint venture with US-based vaccine company, Novavax. The new venture will be called CPL Biologicals Pvt Ltd. As per the tie-up, a new vaccine manufacturing facility will be set up with an initial investment of Rs 100 crore at Dholka near Ahmedabad and will manufacture various vaccines including those for the dreaded Swine Flu.
"This joint venture represents an important strategic alliance for vaccine development and manufacturing in India and uses cutting-edge vaccine technology", IA Modi, chairman of CPL Biologicals said. The Dholka facility will develop, produce and sell products such as influenza vaccine and other novel vaccines based on the VLP (Virus Like Particles) technology. "This facility which is coming up on a part of the 160 acres owned by Cadila Pharma and will be ready within one-and-a-half or two years", Mr Modi told ET. As per this partnership, Novavax will also transfer its technology.
"Initially, we expect Novavax to outsource some of their testing and research activities", he added.
Earlier in April, ET had first reported that Cadila Pharma would hold 80% stake in the JV, while the rest would by held by Novavax. As part of this alliance, Cadila Pharma had then entered into a stock purchase agreement, where it bought nearly 12.5 million shares of Nasdaq-listed Novavax at a market price of $0.88 per share; for an aggregate amount of $11 million.
Initially, the JV will concentrate on developing a vaccine for the pandemic H1N1 (swine flu). Novavax is currently developing the vaccine in the US. Cadila Pharmaceuticals has turned aggressive in the recent months. In March, it launched first of its kind cardiac drug – Polycap, meant for those who are prone to cardiac diseases due to various reasons that include drinking, smoking, diabetes, life-style or genetic conditions.
The discovery of Polycap was upheld as one of the major discovery in the medical world at a cardiac conference held in the US. Cadila is also on the verge of unveiling another major drug ‘Resorine", that would bring down the cost of TB treatment by 33%.
"We aim to be a major vaccine manufacturer. In the next 3-4 years, we will have a list of vaccines to offer", said Mr Modi who is eyeing the lucrative vaccine market in the country. According to market analysis firm Datamonitor, the Indian vaccine market is pegged at $665 million (2007-08 figures) and is growing at over 20%. This market is primarily driven by exports worth more than $360 million. The domestic market for vaccines is $300 million with the private sector accounting for half of it at $120 million.
"The new plant will be a multipurpose plant, where we aim to develop products which are not available in the country. For instance, the seasonal flu vaccine will be one of our main targets", Mr Modi said.
Source: Economic Times