The facility, a 10,000 sqm unit at the Komarom Industrial Park, will be refitted for tablet and capsule production. Mylan also plans to install blister packaging and bottling lines, as well as high potency drug handling capacity at the site over the next few years.
The non-branded drugmaker, which paid €67m ($87m) for the plant according to a report the Budapest Business Journal, said that the investment will create 400 new manufacturing and warehousing jobs.
And, while Mylan did not respond to in-pharmatechnologist’s request for additional information, comments by COO Rajiv Malik suggest the firm sees significant potential in both the Hungarian and wider Eastern European drug markets.
Malik explained that: “After conducting a broad search for a suitable facility with the potential to expand, the opportunity in Komarom turned out to be an ideal fit” adding that the plant will support “dynamic business growth.”
He went on to say that: “We are also looking forward to increasing our market share…across the country.”
The investment fits with the development and gradual expansion of Mylan’s business in Eastern Europe as a whole, which has accelerated considerably since its $4.9bn acquisition of Merck KGaA’s non-branded drug business in 2007 .
That deal, in addition to units in Poland, Slovakia, Slovenia and the Czech Republic, gave Mylan its foothold in Hungary and the foundation for its latest expansion plan.
Competition a driver?
Mylan’s efforts to strengthen its Hungarian business and its recent entry into the US injectables market may also be part of a wider response to Big Pharma’s increasing focus on new markets and non-branded pharmaceuticals in the face of looming patent expiry.
The last few years has seen most pharmaceutical firms build generics capacity, with Sanofi’s purchase of Laboratorios Kendrick and Medley, GlaxoSmithKline (GSK) investment in Aspen and Novartis ’ acquisition of Ebewe injectables unit being notable examples.
These deals, which have continued in 2010 as evidenced by AstraZeneca's recent tie up with Torrent, have seen Big Pharmas begin to build in emerging and non-western markets where generic drugs predominate and where companies like Mylan generate a significant amount of their revenue.
So, although Mylan has not said that future Big Pharma competition was a factor in recent investment decisions, it seems unlikely the firm will not have at least considered such trends when deciding where to spend its money.