Lahore-based Citi Pharma Limited entered into a joint venture with Hangzhou Newsea Technology Co., Ltd, a renowned player in the pharmaceutical industry in China.
The pharma shared the development in its notice to the Pakistan Stock Exchange (PSX) on Tuesday.
“The JV, named as ETACI LIMITED (Public limited company) will focus on producing the remaining portion of APIs (Active Pharmaceutical Ingredient) that are not currently manufactured by Citi Pharma Limited,” the company said, as it intends to expand its product portfolio.
As per the statement, Citi Pharma Limited currently manufactures approximately 20 to 22 APIs, catering to various medical needs.
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“Through the proposed joint venture with Hangzhou Newsea Technology Co., Ltd, Citi Pharm Limited plans to manufacture an additional 30 APIs, effectively expanding its range of offerings,” it said.
“The decision to pursue this joint venture underscores Citi Pharma Limited’s proactive approach towards sustainable growth and transfer of technology to Pakistan,” it added.
Sharing the legal structure of ETACI LIMITED, Citi Pharma Limited said that it will retain a controlling interest of 65%, with Hangzhou Newsea Technology Co., Ltd holding the remaining 35%.
“By manufacturing a greater portion of APIs locally through ETACI LIMITED, Citi Pharma Limited will decrease its reliance on imported products, thereby improving cost efficiency, enhancing supply chain resilience and reduction in import bill,” it said.
The Pakistani pharmaceutical said that the JV is expected to generate an annual turnover of more than Rs15 billion.
“From this, the projected cost of sale will be around Rs10.5 billion, resulting in a gross profit of Rs4.5 billion,” said the company.
Moreover, the joint venture is expected to benefit from Citi Pharma Limited’s existing infrastructure and resources, minimizing operating costs and streamlining production processes, it added.
Moreover, this Joint Venture aligns seamlessly with our overarching vision for 2030.