Ranbaxy scales back manufacturing presence in China
pharmafile | January 7, 2010 | News story | Manufacturing and Production |Â Â China, Guangzhou Baiyunshan Pharmaceutical Company, HNG Chembio Pharmacy, Hong Kong New Chemic, RanbaxyÂ
Ranbaxy has shaken up its operations in China with the divestment of its stake a joint venture with Guangzhou Baiyunshan Pharmaceutical Company and Hong Kong New Chemic to pharmaceutical producer HNG Chembio Pharmacy.
Ranbaxy said the move will allow it “to develop a new business model for China which entails the marketing of value added pharmaceutical formulations and the consolidation of manufacturing operations, for cost synergies”.
The news comes shortly after Ranbaxy dissolved a joint venture in Japan with Nippon Chemiphar, Nihon Pharmaceutical Industry, which is now operating as a subsidiary of the Japanese partner. The Indian drugmaker is continuing to supply medicines to the former joint ventue.
Ranbaxy, which is a subsidiary of Japanese company Daiichi Sankyo, has been scaling back its operations around the world – and particularly in Europe – in order to reduce costs in recent months.
Neither company gave any indication of the value of the transaction, which will see Ranbaxy continue to produce and sell products in the Chinese market but represents an exit from its manufacturing operations in the country.
Ranbaxy Guangzhou China Ltd was the first ever joint venture between a Chinese and Indian drugmaker and was set up in 1993 with the aim of bringing Indian-developed medicines to the emerging Chinese pharmaceutical market.
The venture’s manufacturing facility was one of the first in China to be granted Good Manufacturing Practice (GMP) approval, and supplies more than 40 medicines, including anti-infective and cardiovascular drugs.
“China continues to be an important market for Ranbaxy and the company believes that this new approach will create greater value,” said the Indian firm.
US unit falls foul of FDA
Meanwhile, Ranbaxy appears to have suffered another setback in its manufacturing portfolio after the US Food and Drug Administration (FDA) sent the company a warning letter about its US manufacturing unit Ohm Laboratories.
Ohm operates three facilities in the US and received the notice for its liquid production facility in Gloversville, New York, which is estimated to account for around 2% of total group sales. Its main product is the antihistamine cetirizine.
Ranbaxy has already had a series of warnings from the FDA regarding plants in Dewas and Paonta Sahib, India, that export generics to the US and the regulator placed an import ban on products made at the two facilities.
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