IFC commits $47.5m to Indian pharma business

The World Bank arm has made its fourth commitment to the company since 2007 to support its further expansion.

The International Finance Corporation (IFC), the investment arm of the World Bank, is planning to commit a $47.5 million corporate loan to Granules India, a pharmaceutical company in India.

The proceeds will be used to finance an $84 million project to construct a greenfield API manufacturing facility in Vishakhapatnam.

The project aims to improve existing capacity and invest in R&D to develop high quality, low cost drugs in developed and developing countries.

“The project will significantly demonstrate how domestic companies use their strong comparative advantages of low cost of production, scale, quality and regulatory compliance to exploit the opportunities that enable them to move up the pharmaceutical value chain in selling to more regulated markets,” IFC said in a filing.

IFC made its first debt and equity investment in the company in 2007, which was exited in 2014. Subsequently, it provided a Cleaner Production Lending Facility (CPLF) to the company in 2009 and another debt investment in 2011 for the company’s expansion of its Gagillapur facility.

Granules has wholly-owned manufacturing plants near Hyderabad and Vishakhapatnam. It also has an R&D and manufacturing facility in Virginia in the US. It has also established another manufacturing plant in China via a joint-venture.

Granules is a 30-year-old Hyderabad-based pharmaceutical company selling products in India, the US, Europe and Latin America.