The new development in Hay-on-Wye gives Brecon an additional 45,000 square feet of production and warehouse space which will be fully fitted out over the next few months, starting with the installation of new bottling and blister packaging equipment early in 2006.
Pharmaceutical packaging is already highly consolidated, with 465 companies involved in the European market in 2004.
Nevertheless, global demand for pharmaceutical packaging is tipped to increase 6.3 per cent each year to create a $30 billion (€24.4 billion) market in 2009, pushed by emerging pharma industries, tighter government standards on packaging and the burgeoning advanced drug delivery sector.
"Many global pharmaceutical companies are streamlining their operations to focus on their core competences of drug development and marketing and they are increasingly making the move to outsource non-core activities such as clinical trial services and packaging," Brecon's CEO John Bath told In-Pharmatechnologist.com.
"There are a number of other key drivers which are also encouraging pharmaceutical companies to outsource which include optimising their in-house efficiencies, providing greater flexibility, deferring the need for capital expenditure, increasing the speed of a drug to market and spreading the risk as part of a risk management strategy."
The UK company claims the additional production capacity further increases their level of automation, which ultimately has the potential to bring down the unit cost of packaging.
"Our customers will see greater capacity from these new and increased capabilities together with the opportunity for a quicker turnaround of customer requirements," Mr Bath added.
"Brecon is growing faster than its competitors and expects this growth to continue indefinitely."
The firm acknowledges that the majority of pharmaceutical packaging is still carried out in-house but says there is an increasing tendency to outsource non core competencies, such as packaging.