Piramal Enterprises aims organic growth in pharma segment

Mumbai: Piramal Enterprises Ltd (PEL) is looking at growing organically in the pharmaceutical segment to move up the value chain and expanding in services like antibody drug conjugates, injectables and drug discovery, according to its annual report.

"Our pharma businesses continue to deliver significant year-on-year growth. Since the Abbott deal, the business has grown at a CAGR of 17 per cent. We continue to work towards adding more products to better leverage our global distribution network," PEL chairman Ajay Piramal said in the annual report.

In the last two years, the pharma segment deployed around half a billion dollar of capital for future growth through various organic as well as inorganic initiatives, he said.

PEL is now looking at investments for expansion of the manufacturing and service delivering capabilities in niche areas of ADC, injectables, inhalation anaesthesia and discovery services, he said.

It also plans to launch first generic version of Desflurane, the latest generation inhalation anaesthesia product, in FY18, Piramal said.

Last year, the company added two niche differentiated product portfolios in global pharma products business, the report said.

It has acquired a portfolio of five branded products in the injectable anaesthesia and pain management area from Janssen and a portfolio of intrathecal spasticity and two pain management products under development from Mallinckrodt LLC.

"During FY17, we acquired the Ash Stevens facility at Michigan, US, which specialises in the manufacturing of High Potency APIs (HPAPIs). Our recent capacity expansion at Grangemouth and discovery services facility is witnessing commercial success.

"We also expanded capacity at our API plants to handle higher volumes and the phase I expansion of our injectables capacity at Lexington is nearing completion. The team is working towards further expanding its capacity in Lexington in FY 18," Piramal said.

PEL has a global distribution network of over 5,500 hospitals through its direct sales force and distribution presence in over 110 countries across the world.

The company has strengthened its presence in North America and Europe - and generates over 70 per cent of its revenues from these two geographies, which host close to 70 per cent of its assets, the report said.

The company sees huge growth potential in the pharmaceutical segment as global spending on medicines is expected to reach USD 1.4 trillion by 2020, the report said.

Spending on speciality therapies will continue to be more significant in developed markets than in emerging markets.

The global pharmaceutical contract manufacturing market (in terms of revenue) also amounted to USD 65.3 billion in 2016 and is forecast to increase to USD 83.9 billion by 2020.