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It's tough building a fine chemicals operation in today's business climate. "Too many players and too much capacity" plague the business. Because pharmaceutical customers are not discovering innovative new drugs at the rate they hoped, "they are squeezing their customers. In addition, intense competition from Indian and Chinese custom chemical makers has made gaining market share difficult. "I'm not complaining, though," he adds. "We need to offer competitive solutions." Contact has pledged to make the fine chemicals business unit more efficient. Last year, it had about $800 million in sales; Co doesn't reveal unit profits. A Co veteran of 16 years, he plans to increase revenues by about 8% per year over the next three years by improving the unit's cost structure and providing more sophisticated solutions to customers, largely through the skillful application of technology. It's not just pharmaceutical customers who will benefit; buyers of agrochemicals, dyes, flavors, biocides, antioxidants, and electronic chemicals will benefit, too, he says. For instance, the unit plans to roll out new planning and coordinating software by the end of this year to integrate R&D capabilities and 18 production sites in North America and Europe. But it's pharmaceutical active ingredients that concern the most--both for their potential for growth and for the care and cutting-edge chemistry that customers demand. And he has made the development of custom synthesis capabilities for pharmaceutical makers a cornerstone of his business strategy.
"We are the stronghold of organic chemistry know-how in Co In addition, the fine chemicals unit draws on the expertise of the company's Biotechnology Project House--the center of Co biotech expertise--to bring its understanding of genetic technology to the manufacture of fine chemicals.
"Research and technology are key. It's what we live from and sell to customers," The unit invests about $40 million annually in R&D. With that investment. Co helps customers access its know-how in areas such as nucleoside chemistry, amino acid and peptide production, cyanamide chemistry, and halogen expertise. It has ongoing research programs in automated high-throughput process development, microreactors, and membrane reactors for continuous asymmetric synthesis. has also put a great deal of effort into biocatalysis--"another area in which we excel," says Nagler--to help provide pharmaceutical customers with the enantiomerically pure intermediates that they increasingly require. But Nagler's unit employs other enantioselective tools as well, including racemic cleavage and asymmetric synthesis. Co
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