IOLCP expects a turnover of about INR600m per annum from this initiative to diversify into new generic products and is expected to raise the required capital from international markets by issuing $5m, Zero coupon Unsecured Foreign Currency Convertible Bonds (FCCB) (subject to an option to issue an additional $10m of such bonds), which are to be listed on the Luxembourg Stock Exchange (LuxSE).
IOLCP said that the net proceeds from the issue are intended to be used by the company for investment in the proposed PPI plant to produce anti-ulcer drugs, further expanding its existing manufacturing facilities.
RK Thukral, executive director of IOL Chemicals and Pharmaceuticals, said: “The recent Healthcare Bill passed by US Senate has opened the doors of opportunities in the generic drugs market.
“We intend to capitalise upon our inherent strengths and are taking a quantum leap in our business progression with plans to set up a new manufacturing unit for PPIs. We will raise the required capital through the FCCB route and enhance our existing manufacturing and R&D capabilities.
“Considering that only 50% of the domestic demand is being met by the Indian manufacturers and the balance is being met with imports, there is a huge opportunity, which are aiming for.”
IOLCP said that it has also planned to set up another multi-purpose plant wherein, the company can manufacture alternative intermediate products depending upon the current demand and margins. IOLCP’s existing manufacturing capacities of Acetic Anhydride, Ethyl Acetate and iso Butyt Benzene are also proposed to be further increased to cater to the demand. It also aims to upgrade its R&D facilities so as to be at par with international companies.
IOLCP stated that the manufacturing process at the multi-purpose plant is expected to use the same manufacturing facilities and machinery to produce different products like iso Butyl Aceto Phenone (IBAP), Acetophenone, Benzophenone, p-methylacetophenone, Dicholoroactophenone, etc at different times. These intermediate products are being used by pharmaceutical industries and some of the raw materials required for the production of these intermediates are already being manufactured by IOLCP itself.