Suven Life lines up $45-m expansion

HYDERABAD: Suven Lifesciences, a traditional pharma contract research organisation, is planning to scale up its drug discovery development and support services (DDDSS). The idea is to grab a large market share in the custom chemicals synthesis market to service the fast growing clinical trials business in India.

Towards this end, it has lined up a $45 million (Rs 202.5 crore) expansion plan for this fiscal. The expansion will be largely funded from money raised through banks. The DDDSS and R&D units will come up near Hyderabad. “We will invest $25 million in the drug discovery and development support services, which will become functional over the next 24 months. Besides this, we are also planning to invest $10 million for the proposed R&D centre,” Suven Life Sciences CEO Venkat Jasti told ET.

The R&D centre at Pashamylaram near Hyderabad, will work on finished dosage forms and preparation of abbreviated new drug applications. It is expected to commence operations in April-May 2008.

“The returns from this business will help the company scale up its innovative research initiatives and establish a much larger capacity for manufacturing innovator products after clinical trials,” a senior industry analyst told ET. Some of the other companies producing chemicals according to tailor-made needs of large innovator drug companies (or custom chemical synthesis) are Shasun Chemicals and Drugs, Nicholas Piramal and Dishman Pharmaceuticals.

The expansion plans also include setting up a generic drug manufacturing facility over 20 acres in the Pharma City at Vizag. The company will spend $10 million for this facility, which will start rolling in another 18-24 months. Future products — partly generic and partly regulated chemical entities — will be made at this facility.

Suven Lifesciences hived off its clinical trials operations into a separate entity last year. The company clocked revenue of Rs 114 crore in 2006-07. “We have not considered a dilution of our equity stake in the company so far, private equity players have shown interest in our company on several occasions,” Mr Jasti said.