Gland Pharma targets U.S. injectables sector after securing $200M
When Gland Pharma became the first Indian company to win FDA approval for a liquid injectable in 2003, the drug shortage problem was in its infancy. Over the past decade, a FDA crackdown on sterile injectables has escalated the issue, creating opportunities for high-quality producers of these complex products.
Gland Pharma is now preparing to make its play for this market after securing a $200 million investment from New York-headquartered private equity firm KKR. Since winning its first FDA approval, Gland Pharma has expanded in the U.S. by growing its heparin partnership and introducing a suite of generic products. The growth was supported by 5 production plants in the Indian state of Andhra Pradesh, but these sites lack the capacity to match the company's ambitions.
"We have a strong pipeline of innovative injectable products that are awaiting U.S. FDA approval, and with the kind of growth capital we are getting from KKR, we will increase our manufacturing capacity as well as products for the world market," Gland Pharma founder Ravi Penmetsa told The Economic Times. Work on a large-scale production plant--which the Financial Times reports will double Gland Pharma's capacity--is now underway. The KKR investment, which reportedly gives it a 35% stake, will help advance the project.
Gland Pharma produces anticoagulants, anesthetics and other injectable medicines from its existing production plants. The U.S. has struggled with shortages of products in these classes in recent years, in part because the FDA has found fault with quality standards at leading suppliers such as Hospira ($HSP). When the number of new shortages of medically necessary drugs peaked in 2011, the FDA calculated 73% of affected products were sterile injectables.