EDAL also looks for inorganic growth in EU region

Tag : Industrial Laminates

EDAL also looks for inorganic growth in EU region
Ess Dee AluminiumLimited(EDAL), one of India's largestpharmaceutical packaging company, was in the news recently, when itwas cleared by the Board for Industrial and FinancialReconstruction (BIFR), to help revive Kolkata-based India Foils.The buzz is that this will lead to a possible takeover. Sudip Dutta , Chairman and Managing Director speaks to Usha Sharma on how blister packaging will be a key driver for the packagingsegment. He also highlights the fact that US will be the prominentconsumer for packaging in the future
Historically, pharma packaging requirements focused exclusively onpreserving quality of enclosed medication. These requirements arenow being extended to cover such criteria as the prevention ofproduct tampering and counterfeiting, the assurance of productdispensing accuracy and the promotion of patient compliance withproduct dosage schedules.
Could you comment on the pharma packaging industry scenarioworldwide?
World pharma packaging demand is projected to advance 5.3 percentannually to $24.3 billion in 2009. Growth will follow upward trendsin global medication consumption, which will expand at a strongpace as aging demographic patterns lead to an increasing number ofdiseases and disorders. Pharma products will assume an expandingrole in worldwide healthcare delivery based on new productintroductions and economical advantages over other forms of patienttreatment. Besides upward trends in medication consumption, theadoption of stricter regulations and standards governing theproduction, storage, distribution and labelling of pharma productswill boost global growth opportunities for packaging products andaccessories.
China, India will lead gains among top 10 markets. More than 80percent of revenues will be absorbed by the 10 largestdrug-producing countries: US, Japan, France, UK, China, Germany,Italy, India, Switzerland and Brazil. Among these countries, Chinaand India will generate the fastest growth in demand based onrapidly expanding pharma manufacturing capabilities and thephasing-in of government programmes to upgrade the quality ofnationally produced medicines.
The US will remain the largest consumer of pharma packaging as thecountry's advanced proprietary drug-producing sector introduces newsophisticated preparations with specialised storage requirements.Growth in demand among the top West European drug makers willlargely reflect increasing applications for blister packagingattributable to the European Union (EU) directive that allprescription drugs dispensed directly to patients be in a unit dosepack. Downward pricing pressures on government-reimbursed medicineswill account for below average gains in Japanese pharma packagingdemand.
Blister packaging will generate the highest world-wide growth amongall pharma packaging products, with demand increasing by 6.6percent annually to $4.9 billion in 2007. Among the drivers forthis growth is a move by regulators in some countries to insistthat blister packs are used for a number of medications for safetyreasons. For example, Western Europe will provide an especiallystrong regional market for blister packaging as legislationdictates that the majority of prescription drugs dispensed directlyto patients in EU countries must be provided in unit dose packs.
Other reasons for the growth in blister packaging include its broadadaptability to unit dosing, which can improve safety andcompliance and help defend against counterfeiting. And blisterpacks are increasingly being used in clinical trial samples andover-the-counter (OTC) and sterile drugs.
Please discuss latest developments in the company?
EDAL having established a niche as an end to end packagingsolutions provider to the pharma industry is now slowly but surelyestablishing its credentials as the preferred option to the foodand FMCG sector for aluminium foil based flexible packagingmaterials. EDAL has already commercialised aluminium foil basedlaminates for contraceptives, oral re hydration salts,confectionery, suture, bubble gum, amongst other applications. Thecompany supplies cold form of alu alu laminate, tropical and childresistant laminates to the healthcare industry which is in fullswing. Finally, three years of intense R&D efforts haveresulted in optimum packaging efforts bearing fruit leading tosignificant savings for the pharma industry.
Could you comment on the spurious packaging market? How large isit?
According to the WHO, a counterfeit medicine is, "A medicine,which is deliberately and fraudulently mislabelled with respect toidentity and/or source. Counterfeiting can apply to both brandedand generic products and counterfeit products may include productswith the correct ingredients or with the wrong ingredients, withoutactive ingredients, with insufficient active ingredients or withfake packaging.
Analysis shows that counterfeiting is greater in those regionswhere regulatory and legal oversight is weaker, and therefore mostdeveloped countries with effective regulatory systems and marketcontrol (eg. USA, EU, Australia, Canada, Japan, New Zealand)currently have a very low proportion of counterfeit drugs, ie. lessthan one percent of market value. However, we must keep in mindthat indications point to an increase in the prevalence ofcounterfeit medicines even in developed countries. Many developingcountries of Africa, parts of Asia, and parts of Latin America havesuch areas. Here more that 30 percent of the medicines on sale canbe counterfeit. Other developing markets however, have less than 10percent. Overall, a reasonable range is between 10 percent and 30percent. Many of the former Soviet republics have a proportion ofcounterfeit medicines which is above 20 percent of market value-this falls into the developing country range. Medicines purchasedover the Internet from sites that conceal their actual physicaladdress are counterfeit in over 50 percent of cases. The menace isthat the maximum level is in India - as much as five to 40 percentof the entire market.
What are the regulatory norms for the pharma packaging industry?
Globally, one has to comply with EU Norms (European UnionGuidelines). Products have to be DMF registered with USFDA.Additionally, Food grade certification is required for all criticalinputs. Global migration standards have to be meet. Unfortunately,we do not have any regulatory norms in the country. At least 11states in India do not have laboratories for testing medicines. In15 states with functional laboratories, only seven were adequatelyequipped and staffed.
At present how many clients do you have in hand?
More than 250
Do you have any plans to develop spurious drug scanner machine, asBilcare has recently launched?
We, as specialists in the foil converting business have developed adifferent set of answer, some of which analyses utilise thenaturally reflective surface of the metal this could include a widevariety of security features which cater to a range of securitylevels. Amongst them are the use of fluorescent inks, iridescentreflective effects, micro-text that is hardly visible to the nakedeye, holograms and the use of 'guilloche' patterns, such as thoseused in the printing of bonds and security documents
How many new products are in the pipeline and when are theyexpected?
Many innovative and anti counterfeit products/ import substitutesare in the pipeline. However, we have various confidentialityagreements with our customers and cannot currently disclose moredetails.
How large is your marketing network? Is there any expansionexpected shortly?
We have an unique marketing set up- a slim and trim corporateoffice servicing Maharashtra and guiding business managers locatedin Chennai, Bangalore, Delhi, Baddi, Dehradun, Trivandrum, Goa,Ahmedabad, Hyderabad, and Bangalore
What is your growth rate?
The company has been growing at a rate of over 100 percent over theyears.
Do you have any plans to expand your current facility?
The current capacity of EDAL Units stands as under a) Ess Dee -Unit I rolling mill Daman - 9100 Mts per annum and the Ess Dee -Unit Goa - PVC Calandering Unit - 4200 Mts p.a. Currently, ourcompany is operating with two rolling mills at Daman. We are in theprocess of commissioning the third rolling mill at Daman to addcapacity.
Are you looking for any inorganic growth from domestic orinternational markets?
The Foil Packaging industry is driven by capacity. Our companystarted with a modest capacity of 3600 Mts p.a and has scaled up to18000 Mts p.a. Implementation of greenfield projects take time andwe are poised at a juncture where we are restricted by capacity.Hence the company is looking for inorganic growth and has joinedhands with the Vendanta group for the joint revival of India Foils.Apart from the above, the company is actively considering and isinterested in replicating its foot print from India to a globallevel.
Please share some information on your future expansion plans?
The company is in an advanced state with regards to the revival ofIndia Foils. At the same time, the company has completed allformalities in Sikkim and is all set to commissioning a unit there.Apart from the above, the company is on the constant look out forinorganic growth options across the world especially in theEuropean region.
Usha.sharma@expressindia.com