The Israel-based multinational Taro Pharmaceutical Industries has struck its first outsourcing deal with Indian major Alkem Laboratories for formulations development and supply contract for its US and other global markets.

The generics and over-the-counter major is also in talks with intermediate manufacturers in India for acquisition of a facility and outsourcing deals. The acquisition, likely to be in the small-scale segment, may be finalised shortly.

Outsourcing and India: Complete Coverage

Taro and Alkem will jointly develop products for the US and other markets. Taro's revenues from the US is currently about $300 million.

The alliance with Alkem is learnt to be for three to four large selling antibiotic formulations. Alkem will supply products from its plant at Daman, said an industry source.

Taro, one of the largest generics players in the US, set up its India office in January 2004 for exploring outsourcing possibilities for active pharmaceutical ingredients and intermediates. The MNC has facilities at Israel, the US and Canada.

A source in Taro said since its major market was the US, the company was selective about choosing API and intermediate supply partners from India.

Taro, according to the source, will utilise the Indian company's substantial pharmaceutical expertise to enhance its competitive position with specific products in the US and other countries.

Alkem, one of the top 10 domestic pharmaceutical companies, has been growing globally through alliances and partnerships. A source at Alkem said the alliance with Taro was an important part of its globalisation strategy.

Taro's prescription and OTC medications are primarily in dermatology, pediatrics, cardiology and neurology. The company manufactures over 180 products, including topical preparations (creams, ointments, gels, and solutions), oral medications (tablets, capsules, powders, and liquids) and sterile products (injectables, ophthalmic drops and powders).

The company invests 12-16 per cent of its gross sales in research each year. Taro has over 95 abbreviated new drug application approvals in the US.

Joining hands

• Taro and Alkem would jointly develop products for the US and other markets
• Taro is also in talks with a few intermediate makers for acquisition of a facility and outsourcing deals