Merck KGaA to build €40m biopharma plant

28 June 2007 16:05  [Source: ICIS news]

AMSTERDAM (ICIS news)--Merck KGaA on Thursday said it planned to build a €40-50m ($54-68m) biopharmaceutical industry raw materials plant at its Darmstadt, Germany site.

The plant will serve growing markets for these products and follows Merck’s strategy of moving from commoditised products where it competes with low-cost Asian manufacturers.

Biopharmaceuticals currently represent 10-15% of the $600bn global pharmaceuticals marke, Merck's global director of pharmaceutical and food raw materials, Arnulf Heubner, said in an interview with ICIS at the Chemspec exhibition in Amsterdam.  This, he estimated, would rise to 30-40% by 2015.

The plant would start up in different product areas between the first quarter of 2008 and the first quarter 2009, he said. A formal announcement is expected about the project in the next couple of months.

“We estimate that 70% of active pharmaceutical ingredients (APIs) used for generics are coming from the east,” Heubner said explaining Merck’s move away from commoditised products.

Merck was differentiating itself from low-cost producers by offering a comprehensive package to customers - working with them from product research and development along the chain to production, he added.

The industry is campaigning at European level for legislation to force better quality-control of imported pharmaceutical ingredients.

New European regulations governing manufacture of pharmaceutical raw materials have added 30-40% to the costs of manufacture for new entrants to the market. But these standards do not apply to manufacturers elsewhere, Heubner said.

“It is not a level playing field," he added. "They must have extra personnel in quality assurance and in production. They must invest in, for example, clean room facilities and other advanced technology”.

($1 = €0.74)

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Author: Will Beacham
+44 20 8652 3214

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