From CPHI India 2014

Indian manufacturing problems spur growth... for testing companies

By Fiona BARRY

- Last updated on GMT

SGS is expanding its testing facilities in Mumbai, India
SGS is expanding its testing facilities in Mumbai, India
SGS has doubled testing capacity at its Mumbai facility, explaining that Indian API makers’ failure to invest in quality has been good for business.

Export delays which began when the EU tightened its rules on API quality certification in July 2013​ are still plaguing Indian producers, said SGS Life Sciences’ Business Director. 

Speaking to us today at CPhI India, Arun Janakiraman said “Manufacturers in India haven’t received that awareness. There are still delays.​” 

The problem, he said, is simply an issue of cutting corners. “Quality is still not up to standards among [some] manufacturers in India. You see a lot of [US] FDA Warning Letters.

That increases the opportunity for us [as a testing service]. Our business is growing but if you look at the volume of Indian [testing] business, there are still people taking risks.

It’s to save money. Basically they didn’t see any value in putting money into quality.​”

Janakiraman said substandard API manufacturing will not be resolved in India until the country gets rid of its two-tiered production methods – a better one for exports and an inferior one for Indian consumers.

International vs domestic

They are producing two sets of products in India, one for domestic and one for international market. The day they decide to export their domestic product to an international market, their problem starts [with regulators].

When there is just one quality in India, then we can eliminate these hiccups.​”

Janakiraman was optimistic about how quickly the country could narrow the gap with initiatives planned by the new government. Narendra Modi was elected Prime Minister in May this year.

I believe the current government is putting in a lot of effort and is being very proactive in improving quality and giving benefits to quality manufacturers in India.​”

State departments responsible for quality are changing their leadership teams, said Janakiraman, and the government has launched a scheme targeting quality analysts in countries like Singapore and Malaysia to come to India for partnerships.

Manufacturing site

Expansion of the Mumbai site, which performs testing on raw materials, APIs and finished products, will double the current size to around 4,000 sq metres. 

Janakiraman said more clients are asking for Full Time Equivalent (FTE) services – when an SGS chemist works solely for a specific customer. 

It brings mutual benefit for SGS and our customers. Chemists from our side always get the same type of sample so they know exactly what the customer is looking for. Even within CGMP, customer expectations differ so if you have dedicated staff working for them, it’s better.​”

The site is due for completion and validation by Q2 2015. 

It will include three capacity stability chambers (which test drugs against humidity, temperature, and other extreme conditions) of 100 cubic metres. SGS plans to add 39 members of staff to its current 88-strong workforce. 

50-60% of the company’s business comes from the US and Europe, Janakiraman estimated, with the rest from Indian manufacturers.

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