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Catalent Focuses on Softgel in One of Two Chinese Ventures

By Dan Stanton , 13-Mar-2013

Catalent says it has acquired a Chinese softgel producer to expand its drug delivery offerings and expects more investments to come as part of a two-pronged plan into China.

The first prong of the push into China will see Catalent Pharma Solutions introduce its drug delivery services into the Chinese market as the New Jersey headquartered company agrees to acquire the Chinese nutritional softgel producer Zhejiang Jiang Yuan Tang Biotechnology Company.

The second prong sees Catalent Pharma Solutions forming a joint venture with contract research organization (CRO) ShangPharma Corporation, in order to provide clients end-to-end solutions for clinical trial supplies.

Spokesman for Catalent Chris Halling told this publication “these two investments are the first steps to enable Catalent to meet the needs of local, regional and global pharmaceutical and consumer health companies.”

“Growing our capabilities in China and Asia more broadly,” he continued, “is a key strategic goal for Catalent and has commanded substantial focus from Catalent senior management over the last year and will continue to in the future.”

In both areas Halling told us continued investment was likely. “The Clinical Trial Site – a 31,000 sq ft facility in Shanghai - is now under construction” while there are further investments planned “to expand and upgrade the Softgel subsequent to the transaction completion”which is expected in the next few months.

Furthermore he added that “as the Clinical Supply activity in China and Asia grows, we will expand the workforce to meet demand.”

Investment in Softgel

Catalent is no stranger to softgel drug delivery and in an interview with Outsourcing-Pharma.com  in 2011 said the company intended to invest in both drug delivery technologies and scale while keeping an eye out for opportunities in emerging markets such as China.

Regarding this investment, Halling said it gives Catalent the opportunity “to build upon [its] existing softgel network in the Asia Pacific region” while complementing “existing facilities in Asia Pacific.”

Catalent has softgel sites in both Japan and Australia.

The newly acquired facility in Haining currently employs 120 staff which Halling said may be supplemented with rotations from the company’s global team to “align its operational, quality and regulatory approach with Catalent sites across the globe.” Catalent hopes to use the site to move into the softgel manufacturing of OTC and prescriptions in China.

Chinese Clinical Trials

There is a “strong trend towards outsourcing in China,” according to a 2012 CRO Industry Report by analyst company William Blair and Catalent’s deal with Shangpharma is just one of a number of recent acquisitions and collaborations in the region as both Asian and Western CROs have been increasing activity in this sector.

Just within the last week, Chinese CRO WuXi  has announced significant growth in its clinical services offerings and has said it expects trends to continue. Logistics company Marken , too, has opened a Beijing depot in response to demand from clinical trials and even the purchase of Radiant Research’s CRO division by Accelovance  cited China as a key market made accessible by the deal.

As Halling said, “China is one of the fastest growing pharmaceutical markets globally with rising customer needs for clinical trials and locally produced modern and traditional treatments.”

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