To begin with, it plans to manufacture 11 drugs at the Chinese facility for the European and the US markets. Dishman is considering going in for GMP products once the first phase of the facility is on stream.

The company has, for Rs 18 crore, acquired a 80,000 sqm land in Shanghai Chemical Industry Park (SCIP), which has cogen facilities for areas such as steam, compressed air, solvent storage, natural gas and effluent treatment. The total investment in the project would be around Rs 45 crore.

Dishman Pharmaceuticals makes ammonium and phosphonium quats speciality chemicals, which, apart from being inputs in the manufacture of active pharmaceutical ingredients and intermediates, also find application in agro-chemicals, polymers and surfactants.

Dishman Pharma said the Chinese manufacturing facility would offer it a major advantage in terms of cost of the production. The company plans to manufacture some early intermediates from the basic chemicals in China and transfer them back to its Ahmedabad-based facility for further processing.

Dishman raised $50 million through the FCCB route for the Chinese project as well as some planned and future acquisitions. According to the source, the Chinese venture is expected to go on stream by the end of 2007 and it would also help the company tap the Japanese market in the future.