- Companies stayed with the
mentality of treating API as fine/specialty chemicals and a local product.
Their value as a global product was not realized. Had it been realized they
would have seen the global opportunity. Value of economies of scale could
have led to process technology innovation along with business model reconfiguration.
Better technologies could have lowered manufacturing costs and kept drug manufacturing
in the developed countries.
- Companies stayed with and
still practice manufacturing with after the fact product quality testing
vs. produce quality products from the get go. This could have saved companies
as much as 40% of the manufacturing cost resulting is higher profits. Again,
better and innovative processes could have kept manufacturing in the
It is my expectation that by having uniform drug quality, health and safety standards best of the companies will capitalize on economies of scale, as many might drop out, and have the best technologies that will produce products that are as much as 35-45% lower in cost and giving the producing companies the necessary profit margins and revenues from much higher patient base.
Girish Malhotra, PE