India’s Inland Outpost

Marcelo Morales, CEO of HollisterStier, is ramping up contract pharmaceutical production as the market for generics is growing.

A plaque outside HollisterStier Laboratories LLC’s year-old office addition in northeast Spokane holds a message from India.

“Jubilant Organosys Ltd. dedicates these facilities to the employees of Hollister-Stier,” the plaque reads. “May we continue to grow and flourish together.” The names of Shyam and Hari Bhartia, co-chairmen of India-based pharmaceutical giant Jubilant Organosys, are etched below it.

Since acquiring HollisterStier for $122.5 million during the summer of 2007, Jubilant has dedicated much more than a building to the 88-year-old Spokane pharmaceutical-manufacturing plant; the Indian company has poured money and resources into the operation as part of its broader strategy to gain a strong foothold in the North American pharmaceutical market.

The parent company has invested a total of about $40 million in new equipment and the new building addition at the Spokane facility during the past two years, says HollisterStier CEO Marcelo Morales, a biochemist who was born in Chile, grew up in California and spent most of his career in Toronto before moving to Spokane last October. HollisterStier has added about 50 people to its workforce in the past year and now has 541 employees.

“The fundamentals in Spokane remain the same,” Morales says. “Clearly, our mandate is to continue to grow contract manufacturing.”

Contract manufacturing is one of three primary business units for HollisterStier and one the company expects will drive its future growth. Much of the equipment investment in recent years has involved positioning HollisterStier as one of North America’s most significant facilities for sterile-injectable production.

For example, the company has bolstered its capabilities in the area of lyophilization, which involves freeze-drying pharmaceuticals. With the addition of two large freeze-drying units recently, the company doubled its freeze-drying capacity and established itself as one of the larger lyophilizers in the United States, Morales says.

“That scale gives us tremendous opportunity for our clients,” he adds.

HollisterStier typically doesn’t disclose the names of companies for which it provides contract manufacturing services, but the firm has said its clients include a handful of the world’s largest drug makers. 

The Spokane operation’s other business units include allergy-treatment products and project-management services. Morales describes all three units—contract manufacturing, allergy and project-management services—as “businesses that in themselves are profitable.”

Jubilant’s acquisition of HollisterStier marked its first significant step into the North American market, but the Indian conglomerate bolstered its presence further when it acquired Montreal-based Draxis Specialty Pharmaceuticals Inc. in May 2008 for $253 million. Draxis is similar to HollisterStier in that it provides contract manufacturing and has its own specialty products. At Draxis, the specialty products are in the field of radiopharmaceuticals, which involves making radioactive drugs and lyophilized non-radioactive drugs used in imaging centers, hospitals and other medical facilities.

In addition to serving as CEO of HollisterStier, Morales oversees Jubilant’s North American contract manufacturing and is charged with increasing that part of the company’s business. In the fiscal year that ended March 31, revenue from North American contract manufacturing grew by 40 percent compared with the previous fiscal year, Morales says. For the current fiscal year, the company expects double-digit increases in contract manufacturing activity, as well as strong year-on-year growth in the allergy business.

Moving forward, Morales says, “We have very aspiring goals of a continued growth pattern.”

Share this Article

• 
• 
• 
• 
• 
•