Indian dose sites untapped M&A opportunity for foreign CMOs: GlobalData

There is an M&A opportunity for large contract manufacturing organisations (CMOs) in North America and Europe to acquire facilities able to produce medicines with lower operating expenses than in their own territories, says GlobalData.

Adam Bradbury, PharmSource Analyst at GlobalData comments, “Only three per cent of CMO Indian facilities that sell solid dose drugs to North America, Europe and Japan are foreign-owned, and the majority of commercial solid dose facilities in India are owned by India-headquartered companies. Only six US, five UK, and three German CMOs own solid dose manufacturing sites in India.”

Bradbury continues, “While the Indian pharma industry is best known for its small molecule active pharma ingredient (API) production—offered by almost half of the country’s contract manufacturing facilities—India also has a strong commercial dose and analytical services industry, often in the same facilities that manufacture APIs.”

Approximately 38 per cent of Indian solid dose facilities have the regulatory approvals to supply the US, Canada, EU, and Japan.

Bradbury concludes, “India’s presence among the top five countries shows the location’s appeal for contract manufacturers to supply developed markets; however, the facility count does not include all pharma facilities because many Indian CMOs only supply locally and do not have approvals to supply to the US, Europe, or Japan, and many CMOs are headquartered in developed markets’ own local facilities.”