BIOLAB TO INVEST R$ 450 MILLION IN DRUG FACTORY IN MG
LEADER IN THE CARDIOLOGY PRESCRIPTION DRUGS SEGMENT, THE LABORATORY WANTS TO SEEK CERTIFICATIONS TO SELL TO FOREIGN MARKETS; WITH THE NEW INVESTMENT, THE PHARMACEUTICAL COMPANY INTENDS TO REINFORCE ITS EXPANSION STRATEGY IN THE VETERINARY SEGMENT
National pharmaceutical company Biolab announced an investment of R$ 450 million in a new factory on Thursday. The medicines laboratory will be built in Pouso Alegre, in the south of Minas Gerais, and will have the capacity to produce 200 million units of medicines a year.
Biolab is one of the largest national pharmaceutical companies, with revenues of R$ 1.25 billion in 2016, according to consultancy IMS Health. According to the company, the new unit will also be designed to serve the foreign market. Of the projected investment, 40% will be funded from its own resources, and the rest will be raised on the market.
In an interview with Estado, Cleiton Castro Marques, partner and president of the group, said that Biolab had been planning the move for some time. He said that the country's current economic and political crisis had not affected the company's plans. "Despite the crisis, the pharmaceutical sector is expected to grow by 8% this year. Biolab's sales are expected to increase by between 8% and 10%."
Operations at the new industrial complex are expected to begin in 2020, but only partially. The group, which has three production units, all in the state of São Paulo, won tax incentives from the Minas Gerais government to build its new unit.
Between 2009 and 2012, the pharmaceutical sector experienced a boom in investment, with the construction of new units and mergers and acquisitions, especially by multinationals looking for laboratories that produce generic drugs.
This movement has started to slow down in recent years because of the crisis. "The multinationals have taken their foot off the gas, but they're not stopping investing in the country," said Nelson Mussolini, executive president of the São Paulo State Pharmaceutical Industries Union (Sindusfarma).
He regrets, however, that the state is losing investment in the sector to other units of the federation. "The São Paulo government has to look closely at the incentives being granted by neighboring states. São Paulo has been losing investment because of the fiscal war."
DIVERSIFICATION.
A leader in prescription drugs for cardiology and with operations in pediatrics, gynecology and orthopedics, Biolab is also preparing to expand its operations in the veterinary segment. Currently, this business division accounts for 1% of the group's total revenue, but it should become more important over the next three years.
The veterinary market for small animals has been growing in Brazil and this will be the group's bet, according to Cleiton Marques. "The large animal segment has lower margins and is more competitive." Biolab is thus following in the footsteps of other groups, such as Eurofarma and União Química.
Contrary to part of the pharmaceutical sector, which has been looking closely at the dermo-cosmetics segment, Biolab does not want to expand its operations in this area. Marques is interested in working in dermatology, but for prescription drugs.
Biolab has 276 patent applications in various areas of health, including radical innovation. The pharmaceutical group is not interested in entering the generic drug segment (copies of drugs that have lost their patents). "Our focus will be on innovation," said the businessman.