Czech buyout to make Serum Institute largest polio vaccine

Serum Institute of India, which today acquired a defunct injectable polio vaccine unit in the Czech Republic for 72 million euros, said it expects to shift 15-20 per cent of its production overseas over the next three years with this deal.
"Today we make 1.2 billion units/doses of vaccines annually. Only around 2 per cent of this is done overseas now. With the acquisition of the Florida-based Nanotherapeutics' Czech unit, we hope to take this to around 15-20 per cent over the next three years," Serum Institute chief executive Adar C Poonawalla told PTI from his Pune headquarters.
"This acquisition will add to our injectable polio capacity by four times to a total of 200 million doses by 2019, which is four-times the present capacity, and making us the largest injectable (not oral) polio vaccine manufacturer in the world by 2019 when we will be able to restart production," Poonawalla added.

"We will re-design and re-licence the company's 40- acre facility outside of Prague to produce injectable vaccines at a cost of euro 40 million," he said.
With this, Serum Institute's injectable polio vaccine manufacturing capacity will rise to 200 million dosages, while that of the closest competitor then will have a capacity of about 100 million dosages, he added.
Today's acquisition is the second overseas buyout for Serum Institute since June 2012 when it bought Bilthoven Biologicals in The Netherlands for euro 70 million. Bilthoven was government-owned bioengineering and pharmaceutical firm.

Serum Institute faced stiff competition from a number of MNCs to take over the business, it is learnt, he said but did not name of rival bidders.

The acquisition of the Bohumil plant of Florida-based Nanotherapeutics for 72 million euros is historic for the Rs 4,000-crore company, he said, adding this acquisition catapults his company to be the largest injectable polio vaccine maker in the world with over 200 million doses annually.
The Bohumil plant, spanning around 40 acres is an hour's drive from the Czech Republic capital of Prague, has been defunct for the past couple of years and employs around 50 people now. It was once owned by the flu vaccine maker Baxter, he added.
Poonawalla said Serum Institute will invest additional 30-40 million euros to make the plant functional, which on completion will make his company the largest injectable polio vaccine maker in the world.

Nanotherapeutics is a Florida-based biopharmaceutical maker producing single-use, multi-purpose-multi-product, biosafety containment level 3 capable drug and vaccines.
He said they have already paid 45 million for the plant and the rest will be paid in tranches over the next one year, taking the overall investment into the Czech plant at around 110 million euros.
Poonawalla said even in the Holland plant that they bought in 2012, the company has invested in 160 million additionally and hired close to 25 people more to take the total headcount to 400 now. Similarly, Serum Institute will hire around 150 more for the Czech plant as well, he added.

When asked about his revenue break-up, Poonawalla said of the Rs 4,000-crore annual revenue as much as 80 per cent come from exports to 147 countries.
To expand the domestic capacity, he will be investing Rs 50 crore into a new facility in Pune, Poonawalla added.
Serum Institute, set up in 1966, is the world's largest manufacturer of vaccines in terms of dosage and immunobiological drugs and currently employs over 5,000.
Serum Institute makes polio vaccine as well as diphtheria, tetanus, pertussis, Hib, BCG, r-Hepatitis B, Measles, Mumps and Rubella vaccines. It is estimated that about 65 per cent of the children in the world receive at least one vaccine manufactured by Serum Institute.

The company with a revenue of over Rs 4,000 crore has been growing at a compounded annual growth rate of over 30 per cent in the last five years with a profit margins are over 25 per cent.