Export Import Bank of India

December, 2002.

Success Story - Sami Labs Ltd.

Sami Labs Ltd. (SAM!), formerly known as Sami Chemicals and Extracts Ltd., was established in 1991 by an enterprising technocrat, Dr. Muhammed Majeed. The company is today engaged in the manufacture and export of standardized herbal extracts, fine chemicals, specialty chemicals, cosmeceuticals, probiotics and spice oleoresins.

Dr. Majeed, who had earlier done his doctorate in Industrial Pharmacy from St. John's University, Jamaica, New York, founded the Sabinsa Corporation in New Jersey, USA in 1988, with the objective of marketing generic pharmaceuticals of Indian origin. However, delays in FDA approval for such products necessitated a different vision for the company. He then pioneered the introduction of several plant materials of Indian origin to the rapidly growing U.S. nutraceuticals market. These then, were the products that were manufactured at SAMl.

What distinguished these early Sabinsa products from some of the other herbal products then prominent in the marketplace, was the fact that they were all standardized extracts. In other words, the potency of the active ingredients could be assured from one batch to the next. This concept helped to increase the acceptance of herbal extracts of Indian origin in the U.S. herbal market, as they could now be authenticated and analyzed for active constituents.

SAMI started its activities in 1991 with merchant exports. In the same year, it also established a small laboratory to develop new manufacturing processes and analytical methods. In the following year, a small-scale manufacturing unit was set up in Singasandra, Bangalore. This unit manufactures herbal extracts and fine chemicals. SAMI now has four manufacturing facilities at Kunigal, Mysore, Singasandra and Nelamangala, and a corporate office/ R&D center in Peenya, Bangalore. All its manufactured products are exported to SABINSA Corporation in New Jersey, USA.

In association with Sabinsa, USA, SAMI pioneered the manufacture and introduction of several phytonutrients to cater to the expanding global market. Towards this end, agencies were set up in Europe, and a full-fledged office established in Japan. The nutraceuticals focus has now expanded to include cosmeceuticals, which are increasingly finding applications in personal care products. The thrust at SAMI is on market-oriented research and new product development. Ideas for new product development are generated on the basis of the feedback received from its U.S. marketing arm, Sabinsa Corporation and its customers, and also from other international markets.

In the specialty chemicals area, pioneering research led to the development of L (+) Selenomethionine, a nutritional source of the essential trace element, selenium. This product won for Sami Labs the National Award for basic drugs in 1994.

Exim Bank has been playing a key role in the development and growth of the company. In fact, SAMI's first biotech facility was built with financial support from EXIM Bank. Exim Bank sanctioned a term loan of Rs. 345 lakh to SAMI to part-finance its project for setting up of facilities for manufacturing Lactobacillus, and for expansion of capacities for manufacturing herbal
extracts in its Kunigal and Mysore units.

Sami Labs is in the final stages of setting up a Supercritical Co2 extraction facility at Nelamangala, utilizing indigenous technology developed at lIT, Mumbai. Here too, Exim Bank has stepped in with financial assistance. Exim Bank sanctioned a term loan of Rs. 450 lakh for setting up the Supercritical Fluid Extraction (SCFE) plant that would meet US FDA requirements. A Research & Development loan of Rs. 350 lakh was also sanctioned for funding research aimed at standardisation of herbal extracts and standards isolation, development of newer applications for existing products, expansion of research & development in fine chemicals, development of patentable products, tissue culture, and agricultural research.

Stringent adherence to quality and a commitment to the principles of "tradition, innovation and research" have resulted in several awards and international recognition for SAMl. The company was awarded Export House Status by Government of India. This was followed by the award of the Spices House Certificate, and a recognition of manufacturing facilities and GMP (Good Manufacturing Practice), by the Spices Board.

SAMI also co-owns seven US-issued Patents, ten pending US Patents and 23 international patents with Sabinsa, U.S.A. In order to be a global player in the true sense, SAMI plans to introduce in India the cultivation of medicinal plants from all over the world. SAMI has over 95%, export orientation. Its cumulative exports in the last 3 years stood at Rs.130 crore.

The story of SAMI thus demonstrates how an Indian company can successfully make pioneering strides in the rapidly growing global market for products of Indian origin.