Neeraj Agrawal, CEO of Generics at Jubilant Life Sciences, told Outsourcing-Pharma.com in an interview at his office in Delhi, India: “For us, the focus is to continue to continuously add capacities that are of high quality.”
“Our aspiration is to grow at 20 to 25% per year and all of our expansions are targeted at that,” Agrawal said.
‘Last Man Standing’
In terms of how Jubilant is able to compete with other CMOs in India that might offer lower cost products, Agrawal said, “We never claim that we are the lowest-cost CMO service provider – customers come to us for quality.”
“Many CMOs or companies miss that the price isn’t the only game – it’s an important factor, but if I can make sure my customer is never stocked out, that’s a big advantage,” Agrawal said. “Nobody is scared in my business about delays – it’s part of life. We’ve communicated very well with our customers,” which is what puts Jubilant at an advantage.
As far as the recent closure of competitor Ben Venue and the issues plaguing Ranbaxy, he said they’re good as an opportunity for his company but, in terms of Ranbaxy, “as an Indian I feel bad about it – there are better ways to compete. It puts a kind of bad cast on the whole of the Indian industry and creates a bad wrap for the rest of the country.”
“The CMO industry is about the last man standing – if you’re last, you’ll make a profit,” Agrawal said.
North American Expansions
Of the three facilities in North America -- in Spokane, Washington, Montreal, Canada, and Salisbury, Maryland -- the company is looking at expansions at two sites. Ninety-seven percent of Jubilant’s sales are for the US, European and Japanese markets, Agrawal told us.
At the company’s facility in Salisbury, Jubilant recently invested about $12m, though most of that investment was for packaging facilities and warehousing, with limited manufacturing expansions, he said. “We’re working with Pfizer there and J&J,” he noted, adding that the relationships are “all for different products and different tenures.”
The Salisbury facility was inspected by the US FDA about two months ago, he added, without any 483s.
Closure on Warning Letter
The Montreal facility’s sterile injectable portion was recently hit by a warning letter, though the company in August also expanded that site.
“We were surprised by the points raised by the FDA,” Agrawal said. ”They have re-audited two or three weeks ago and everything has gone well and we expect a closure to happen soon.”
He added that the expansions from August are more of a routine process. “We’re looking into expanding more on the Spokane site because of the availability of space, and the availability of infrastructure to expand,” he added.
Of the company’s 6200 employees, nearly three-quarters are located in India, though Agrawal said that “gap” in salaries between its North American and Indian employees is “narrowing down pretty quickly.
“I would say for a production head at a site, the numbers are very quickly converging,” he added, noting that at the entry level that gap is significantly higher.
“We just completed a round of expansion at our finished dose plant in Roorkee, India,” Agrawal said, noting the next round of expansion will probably start in around 12 months from now.
At its API plant in Mysore, India, the company typically adds “one new production block every two years,” Agrawal said, noting that it has been inspected by French authorities, Mexico’s COFEPRIS, Japan’s PMDA, and Australia’s TGA among others. The Mysore plant also gets clients inspecting the site typically two or three times every month.
“Out of India, we’re probably the largest exporter of finished tablets to Japan,” he said. “We probably export between $35m and $40m worth of products to Japan. And that will continue to grow.”
The company’s facility in the north of India - Roorkee - was audited in March by the US FDA and two minor 483s were issued though final approval was given in August.