Shasun’s Cuddalore plant operations still on hold after cyclone
The contract manufacturing organisation halted production at the facility – where it makes the anti-ulceratives nizatidine and ranitidine as well as several pharmaceutical excipients - on December 30, citing damage caused by the storm as the principal reason for the stoppage.
Shasun managing director Abhaya Kumer told the Hindu Business Line that active pharmaceutical ingredient (API) production is unlikely to resume for the next few days and that each day lost is costing the organisation some INR15m ($281,000) in lost revenue.
He said Shasun “is assessing the extent of damage and is doing the needful to resume operations at the earliest.”
Manufacturing operations at a second facility in Puducherry, which lost power when the storm hit, are continuing using back-up supplies.
Shasun makes the API for Ibuprofen – its best-selling product - and also conducts contract formulation development work at the Puducherry plant.
Contract plans
The stoppage is the third Shasun has suffered in the last 12 months.
In the first half of fiscal 2012 operations at Cuddalore were halted for 25 days while production at Puducherry was also suspended for 15 days earlier last May as a result of industrial action.
The Cuddalore shutdown also comes days after Shasun announced its intention to try and expand its contract manufacturing business by partnering with international companies interested in targeting the Asian pharmaceutical market.
The plan – according to a report in the Business Standard – has already seen Shasun partner with two major companies for formulation development and begin talks with two more potential customers.
At the time Kumer told the paper “In this business, we will have 50 per cent more margin than the traditional margins for manufacturing. For the MNC partners, they don’t have to worry about the regulatory or quality side since we do manufacturing.”
What impact, if any, the shutdown has on Shasun’s efforts to grow its contracting business remains unclear although the firm will surely be keen to limit such stoppages to a minimum.
