How much investment needed to start a pharma mfg. plant

 How much investment requires to start a pharma mfg. plant

The pharmaceutical manufacturing plant is a premium manufacturing business in India and also anywhere in the world. The pharmaceutical sector is the most promising business in terms of respect and earnings. According to the Ministry of Commerce and Industry, the growth of the pharma sector jumped to 103% in comparison to 2013-14 and 2021-22, the absolute figure comes out to Rs. 90, 415 Crores in 2013-14 to Rs. 1,83,422 Crores in 2021-22.

India has an edge in this sector due to a big skilled workforce available for the pharma industry. Countries like US and UK are the big importer of Indian pharmaceutical generic products. If you are a business owner and looking to enter in pharmaceutical sector the right way will be to start with a manufacturing plant. The Pharma marketing industry is struggling due to price fluctuations of third-party manufacturing companies. 

Also Read Pharmaceutical formulation plant for sale in North India.

The biggest question that arises in everyone's mind is "How much investment requires to start a pharma mfg. plant in India?" It is a famous quote in the pharmaceutical industry. However, it has not a one-line answer, and a specific value to announce because the cost of pharma plant installation is changed as the person changes and the location of the plant setup changes. 

You have to be very specific to get a true answer to this question. First of all, you have to declare a specific location where you are willing to set up the company. Secondly, you have to decide how many sections or dosage forms you are going to get approval in that plant. Third, what size of the plant in terms of building and land, and what capacity of machines you are willing to install in the plant. For example, if you thinking of setup a plant over a 1000 sq. meters plot your budget will be different to a 3000 sq. meters plot. Similarly, the capacity of machines (per day output) also put the same impact on the total cost of the plant. 

There are many crucial factors that affect the total cost of the plant. Some significant variables are land cost, locations, concern Drug Department, choice of sections, the capacity of the plant, the capacity of machinery, and Certifications you are willing to get in the plant. 

In this article, I am trying to show you a factual picture of the cost you need to set up a pharma manufacturing plant in India. 

Some people make false statements that a pharma plant with three sections (Tablet, capsule, and liquid orals) can be started in an amount of Rs. 2 cr or 3 cr, it is a totally baseless argument. Some YouTubers who have never seen a pharma company from the inside claim such arguments. You should follow an expert's advice before taking any steps toward plant setup. 

We are in the business of pharma plant setup consultation and turnkey projects for 8 years so I can provide you a tentative cost of pharma plant setup. It is a totally scientific job that requires a 

high level of scientific consultancy and alertness while taking any step in the process of plant installation.

See the following table in way of the cost sheet you need to set up a pharma plant in India. 

S.No.	Description	Qty	Unit	TOTAL COST
1	Land cost for plant setup	1000 sq. mt	5000	5000000
2	Construction of building with flooring with Kota stone and wall putty	15000sq. ft	1100/- per feet	15000000
3	Manufacturing machineries for Tablet, capsule, and liquid oral sections ( Medium capacity machineries included)			15000000
4	Laboratory furniture and required instruments for obtaining the license (including HPLC, UV, and Microbiology lab instruments)			5000000
5	Fire tank construction up to 50000 lit., fire line in the building, fire cylinders as per NOC requirements. Motor and pump installation in the water tank, (Fire NOC)			600000
7	ETP plant setup, ETP pit construction, and complete setup of the system up to functioning conditions. ( For the capacity of 10000 liters per day of the tablet, capsule, and liquid sections)			800000
8	Air line, Nitrogen line, and complete insulation of lines			200000
9	Submersible boring and complete pipes, electric motor, cable, starter, labor.	1	300 feet	80000
10	Ducting as WHO-GMP norms, with insulation	20000	145 sq. ft	2900000
11	AHU Complete (DOUBLE SKIN AHU) total numbers required: 20 AHU units ( as per WHO-GMP certificate) & HEPA FILTERS, TERMINAL HEPA FILTER, Pressure Monitoring Systems, Electrical Panel, AHU Panel. & cabling of 20 AHUs Condensing Units only	20		3000000
12	Complete Chiller plant setup with supply to AHU Units,	2		2000000
13	Plumbing work in every section of the plant, with material, and high-strength industrial GMP Drain system, complete material, civil architect consultation, the labor of drainage system,	on 17000 sq. feet		500000
14	Puff panel partition on the ground floor with material coating as per WHO compliance for the surface to contact to material inside the production area. With installation. (Approx area: 800 sq. mt)	1600 sq. meters	1600	2560000
15	Complete electric work inside the production area of the company including electric panels, switches, 3 line wire cable up to machines, lights in the production area rooms, switches, and boards for machines plugs, ( All material will be used heavy duty industrial grade, the wire will be used brand like RR cable, supreme, Surya, etc,) + Complete labor, electric engineer's drawing and consultation fee included.			1700000
16	Complete Water line in production and DM/RO water system for plant capacity requirements	1	1	600000
17	GMP complying materials Doors (total 60 doors) and 35 windows (double side glass plain surfaced) in the productions area only. DOOR=15000 Each, WINDOW=10000 EACH.	60+35		1250000
18	Epoxy work in the required production area and kota stone repair after laying out of plumbing work breakage	4500 sq. ft	90/ sq. ft	400000
19	Fall ceiling in the production area where it is required up to 5000 feet needs a minimum,	5000	70	350000
20	GMP compliance Pass boxes for material movement room to next room, SPB 2 door 2x2x2=12, SPB 3 door 2x2x2=3, Dynamic 2 door 2x2x2 =2, Dynamic 3 door 2x2x2 =2	18		750000
21	Misclacious machinery (production and lab)			500000
22	DIC documents, Pollution Noc,			300000
23	Liosoning and Drug license expenses			600000
		TOTAL		59090000
			Five crores ninty lakh ninty thousand only
Note:	These expenses are for three section medium size plant with medium-grade machinery and a WHO-GMP level compliance system, the price may go up or down about 10 percent due to various factors that can not be counted in general terms cost observations.

In this cost sheet, I tried to cover all points required in plant setup but it is highly possible some insignificant steps may have been missed. The cost of the plant will be in this range in 2023. If someone is telling you the cost is around 2 or 3 crores either he is making you a fool or he has no idea of plant setup. 

In 2023 everything is available at a double price so the price of plant setup has increased almost twice from the year 2021. 

Minimum steps to set up a pharma Plant?

Pharmaceutical formulation plant setup is a totally scientific and expertise-level job that requires a 

high level of precision.

The following major steps are required to set up a pharma plant:

1. Designing and Planning.
2. Layout map of plant All drawings like Building, fire, plumber, air, water and electricity AHU, Ducting, Doors, and pass box.
3. Construction bounding. 
4. Clean room area development
5.  AHU and Fall ceiling 
6.  Installation of machines. 
7. Setting up laboratory
8.  Preparation of documents like. SOPs, MFRs, Application for drug license.

Total time required to set up a pharma plant

Small-scale pharmaceutical manufacturing plants in India required a minimum of about 18 months to 24 months from the start to the production level stage. There are many things that consume time at the level of clearance by Govt. departments. If you need CLU or Form-143 in Uttarakhand or Form-118 in Himachal Pradesh, it may take up to 6 months. 

The total time of completion of a pharma formulation plant may vary by various factors like DIC permission, Fire department NOC, Pollution department NOC, Form-143, Form118, CLU or bank-related hurdle. Therefore, it is always said that following the advice of an expert while building a pharma manufacturing plant, the advice of an expert will cut your cost in terms of avoiding the revisions of works, saving time, and resulting in an objections-free unit. 

References: 

• Business Today
• PIB.GOV.IN/Ministry of Commerce & Industry
• Phrma.org

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