Capital investments by pharma players

Companies from Europe, the US and Japan have announced the construction of new facilities this month, suggesting that despite a difficult operating environment big pharma is still making significant capital investments.

Swiss drug major Novartis plans to invest around $180 million (€146m) to build a new pharmaceutical manufacturing facility in Singapore. Construction is due to start late this year, with completion scheduled for early 2007 and full operation in 2008.

The focus of the new plant will be the production of bulk active ingredients of Novartis' new and existing products, including the anticancer agent Glivec/Gleevec (imatinib mesylate), the antihypertensive Diovan (valsartan) and the irritable bowel syndrome drug Zelnorm (tegaserod).

Meanwhile, Merck & Co has announced plans to build a new US Human Health division headquarters on a 154-acre site in Pennsylvania. Construction of the 600,000-square-foot unit is expected to begin in mid-2005 and will take about two years to complete.

The site has the potential to accommodate more than 1 million square feet of office space and more than 3,000 employees, and the project is expected to cost about $200 million to complete.

In Japan, Fujisawa Pharmaceutical - soon to merge with Yamanouchi to create the number one Japanese drug company - has completed the construction phase of a new facility to produce micafungin, the active ingredient in its Funguard antifungal product. This was the first drug in the new echinocandin class to reach the market, debuting in Japan in 2002, and is also under regulatory review in North America and Europe.

The manufacturing process of micafungin is divided into three plants, fermentation in Nagoya, synthesis in Toyama and formulation and packaging in the Takaoka facility. The expansion of the formulation function in Takaoka will allow Fujisawa to cope with the anticipated increased demand once micafungin gets approved in foreign markets.

Commercial supply from the plant is expected to start in march 2005.

Finally, Japanese herbal medicine manufacturer Tsumura is planning to expand the manufacturing facilities of its Ibaraki Plant. The company will invest Y3.8 billion (€28m) to boost to 700 tons per year the plant's Chinese herbal medicine (Kampo) production capacity by fiscal 2006.