Fresenius AG, the German pharma major, sources its worldwide requirements of standard solutions from its plants in India, which includes Fresenius Mafatlal's Ranjangaon plant, a 51:49 joint venture between Fresenius AG and the Mafatlals, and its wholly-owned subsidiary, Iveon, at Nashik.

After the recent acquisition of Pharmacia and Upjohn's nutrition- and- infusion brands by the German parent outside Germany, Bhargav said Fresenius Mafatlal would introduce its intravenous products in the country. Initially, these would be imported from Sweden and later, manufactured here.

He clarified that the acquisition of the Pharmacia and Upjohn products would be completed over the next four months after which Fresenius would take over production. The Pharmacia andUpjohn brands to be introduced in the country are Intralipid, Vitrimix (a fat emulsion) and amino acids. While it would take Fresenius Mafatlal between three years and five years to start producing any of these products in India, it would start first with the manufacture of amino acids, followed by fat emulsions.

The company's Ranjangaon plant has provision for three lines although only one is in use at present. The introduction of product variety will require the creation of new lines for which sizeable investments are envisaged, each line requiring up to Rs 20 crore.

The issue of sourcing funds for this expansion is likely to be taken in the next two months. Bhargav did not rule out the possibility of Fresenius Ag pumping in the additional equity since this would be a cheaper route for the parent. With domestic interest rates far above those which the parent can access, it is unlikely that the joint venture will increase the level of its term-loan funding.

The market for these products is dividedbetween glass bottles and single- and double-chamber bags. Fresenius Mafatlal would start production of amino acids in bags, and later go in for fat emulsions, also in bags, since the machinery for the bottles and bags is different. Since these products fall under the category of life-saving drugs, the 4 per cent additional special customs duty would not be levied, Bhargav said.

The existing manufacturers in this product category include Core Parenterals/ Core Healthcare and Wockhardt, while the international manufacturers seeking to enter the country are a German firm and the US-based Baxter. Both are expected to launch their products in the country in the next two months.

The relevance of the plasma volume expanders which Fresenius Mafatlal will launch next year has to be seen against the backdrop of the recent Supreme Court directive against professional blood donors and the subsequent hardship faced by those having to undergo emergency surgery, especially burns and road accident victims. The plasmaproduct ensures that oxygen supply is maintained although it has no red blood corpuscles. Hoechst has a `very old' product in this category, Bhargav added. Fresenius Mafatlal produced 18 million bottles of standard solution while Iveon produced 15 million bottles. Of the total 33 million bottles, 7 million bottles were exported. This amounts to 21 per cent of production, valued at Rs 7.35 crore in its first full year of production. Fresenius Mafatalal has an equity of Rs 29 crore. Bhargav said if the Mafatlals chose to dilute their stake, Fresenius would pick it up.