Shasun expands process development with US facility

The company has taken a long-term lease on a research laboratory at the US site and will scale it to provide active pharmaceutical ingredient (API) services for preclinical and clinical trials to customers in North America. The process development facility, which will start operating in April 2008, will also offer back-end support to partners in the region for Shasun's growing contract research and manufacturing services (CRAMS) business. The initiative underlines not only the increasing importance of the North American market to Shasun's spread of activities in pharmaceutical research, development and manufacturing but the company's strategic evolution from a leading manufacturer of core APIs such as ibuprofen towards a one-stop shop for drug multinationals, providing integrated services from discovery through to production of finished formulations. "This is clearly another step to reinforce our presence in the CRAM space, which remains one of the key strategic focuses of the company,"​ commented chief technology officer Dr Michel Spagnol. Shasun has not disclosed its investment in the Piscataway facility but says it is "significant … in terms of both long-term financial commitment and the creation of almost 50 new, highly skilled jobs"​. The plan is to build on this base and operate on full capacity from October 2009. The new facility will bring Shasun closer to its process development customers in a market where "proximity of the service is a must"​, Dr Spagnol noted. It complements existing sites for API development servicing preclinical and early-phase clinical trials in the UK and India. Shasun's UK manufacturing sites in Dudley and Annan - acquired with the custom synthesis business of France's Rhodia Pharma Solutions in early 2006 - include laboratory, kilo lab (intermediate facilities for initial drug scale-up) and pilot plant resources, while the same offering is available from Shasun's Indian facilities in Chennai, Cuddalore and Pondicherry. As Dr Spagnol explained, prior to its acquisition by Shasun the Rhodia Pharma unit had consolidated its North American CRAMS business at a facility in Chambers, New Jersey. However, this did not fall under the acquisition agreement as the US facility was over-sized and under-utilised. At the same time, Dr Spagnol added, Shasun was conscious of the need for a laboratory facility in the US market to cater for innovator and emerging companies so that it could "continue to maintain a healthy pipeline in various phases of clinical trials and the opportunity to scale them up in future in our pilot or commercial plants in the UK or in India"​. He believes the Piscataway facility will "enhance our position as the leading chemistry services provider with both eastern and western facilities"​. According to Shasun, the new investment will "further enhance and expand [its] current capacity to provide global clients a seamless range of services from cutting-edge R&D to large-scale manufacture and analytical development. With the Piscataway operation being situated at the heart of emerging markets, it will help Shasun Chemicals to expand the offering to existing clients and attract new clients with a broad range of leading expertise and technologies"​. The company is already some way down the road to diversification. In the third quarter of fiscal year (FY) 2008, 57 per cent of its revenues - Rs 255.46 crores (€43.82 million; one crore = 10 million) in total, up by 31.6 per cent over the same quarter last year - came from the CRAMS business. Moreover, nearly 50 per cent of this business in sales terms is based in North America. At an analysts' call for the third-quarter results, N. Govindrajan, chief executive officer and managing director of Shasun Chemicals, said the CRAMS business had contributed 40% of consolidated revenues in the year to date, while ibuprofen - despite growing at 40 per cent - accounted for just 30 per cent of overall revenues compared with 50 per cent in the first nine months of FY 2007.