Nycomed moving API production to India

Zurich, Switzerland - Privately owned pharmaceuticals company Nycomed  is to amend its existing joint venture agreement with Cadila Healthcare to include the chemical production of active pharmaceutical ingredients (APIs) by the joint venture company Zydus Nycomed in India. Nycomed said it plans to transfer the current chemical production from the sites in Linz, Austria, and Singen, Germany, to the new JV within the next four years and that up to 200 positions out of about 1,400 in Singen and Linz might be affected.

Nycomed and Cadila already collaborate in the Mumbai-based Zydus Nycomed JV, which currently supplies key starting materials for the production of Pantoprazole. According to Nycomed, the new agreement will further enhance the competitiveness of its production operations and enable it to meet customer demand directly instead of outsourcing the production.

Barthold Piening, Nycomed’s executive vice president operations, said: “The chemical API production is under increasing cost pressure from countries with lower wages. We will focus on the pharmaceutical production, because this is an area for future innovation where we can utilise all our know-how to compete."

Chairman and MD of Zydus Cadila, Pankaj Patel added, “The need to create a centre of excellence that sets the highest global standards in quality and service has been the very basis of this partnership. The new avenue that we have opened up strengthens this premise and will add a new dimension to the mutually beneficial partnership that exists between the two companies.”

The plans are the result of Nycomed’s continuous Network Review process, set up with the aim to be a best-in-class mid-sized pharmaceutical company. Nycomed’s production network is constantly reviewed and optimised, for example by increasing utilisation, enhancing the supply-chain performance, maintaining a state-of-the-art service level and decreasing the cost of goods sold (COGS) ratio.

With 550 employees, Linz is one of Nycomed’s larger production facilities. As a dedicated Centre of Competence, it will combine technological skills in the production of sterile ampoules and biological products. Linz is home to the successful Actovegin and TachoComb/TachoSil line of products. The 840-employee Singen operation is Nycomed’s largest production facility and a  technology centre focused on steriles, aseptic products and semi-solids.

Nycomed is active in a range of therapeutic areas, with key products aimed at gastroenterology, pain management, osteoporosis, respiratory diseases and tissue management. New products are sourced both from our own research and from business partners. The combined group employs over 11,500 people. In 2007, it had annual sales of € 3.5 billion and an adjusted earnings (EBITDA) of € 1.2 billion.