Alpharma and Shasun enter generic manufacturing deal

Alpharma expects the collaboration to significantly accelerate the expansion of its global generic product pipeline in line with company strategy.

Ten products with global brand sales exceeding $20 billion are initially planned under the agreement, and additional products may be added over time. Product launches are scheduled to begin in 2007.

Under the agreement, Shasun will develop active pharmaceutical ingredients and final formulations, and manufacture finished products for exclusive sale by Alpharma worldwide. Alpharma will take responsibility for the regulatory filings and will own all intangible assets developed by the partnership. During the period of exclusive sales by Alpharma, the two companies will share profits and Alpharma will reimburse Shasun for certain development and manufacturing costs.

Alpharma believes the agreement not only gives the company access to low-cost manufacturing facilities but also new markets in which to launch their products. Ingrid Wiik, vice chairman, president and CEO at Alpharma said: “Industry data suggests that manufacturing costs for Indian pharmaceutical companies are more than 50% below US and European multi-national companies, and drug development costs are a fraction of US costs.” She described the partnership as mutually beneficial.

The agreement with Shasun follows a similar development and manufacturing arrangement with another Chennai-based company, Orchid Chemicals & Pharmaceuticals.