A Munich-based biosimilar developer just signed a strategic manufacturing partnership with an Indian CDMO. According to industry analysts, it is not the first such deal, and it will not be the last. The question is what Europe gets — and what it gives up — as the shift accelerates?
On 14 July 2026, the Munich-listed biosimilar developer a Formycon AG announced in a press released a strategic manufacturing partnership with OneSource Specialty Pharma, a Bangalore-based contract development and manufacturing organisation. Under the agreement, OneSource will provide integrated drug substance and drug product manufacturing from its biologics facility in Bangalore for Formycon’s biosimilar programmes targeting global markets.
The announcement was framed in the language of strategy and growth. According to the official press release, Dr. Stefan Glombitza, Formycon’s CEO, said: “Reliable, scalable and cost-efficient manufacturing is a cornerstone of our FYB4Growth strategy”. OneSource, for its part, according to the same statement, described the partnership as reinforcing its belief that India is “uniquely positioned to serve as a global hub for the development and manufacturing of world-class biologics,” as Neeraj Sharma, Managing Director & CEO of OneSource Specialty Pharma, said in the press release.
Both statements, as reported in the companies’ official communications taken together with the broader trajectory of European pharmaceutical manufacturing decisions over the past decade, according to industry observers, describe a structural shift that the Iran war has simultaneously accelerated and complicated.
India’s position in global pharma manufacturing
India’s pharmaceutical sector, according to India’s Economic Survey 2025-26, is not merely large — it is systemically important in a way that no other country outside China can claim. According to the Press Information Bureau of India, the domestic pharmaceutical market was valued at USD 60 billion in 2025 and is projected to reach USD 130 billion by 2030. According to India’s Department of Commerce, pharmaceutical exports reached $31.11 billion in FY26, though the industry missed its target of $32 billion. According to the US FDA, the country supplies 47% of US generic prescriptions, as noted by multiple industry sources.
India is no longer merely the world’s low-cost generic factory
The cost advantages are well documented, though the precise figures vary by source. According to a 2025 comparative analysis published on medRxiv, manufacturing active pharmaceutical ingredients and finished dosage forms for the Indian market incurs approximately 43% lower capital expenditure and 47% lower operational expenditure compared to the United States. According to industry analysts, the more recent shift — the one that the Formycon-OneSource deal exemplifies — is the move from generics toward biosimilars and complex biologics. India, as pharmaceutical trade publications note, is no longer merely the world’s low-cost generic factory. It is positioning itself as a manufacturing partner of choice for the next generation of high-value medicines.
Why the timing of the Formycon deal matters?
According to the companies’ announcements, the partnership came six weeks after the now desolved Hormuz ceasefire agreement, which could have gone for the better, and in the same month that commercial traffic through the strait began to normalise, as reported in mid-July 2026. That context, according to supply chain analysts, is not incidental.
According to logistics experts cited in industry publications, the four-month Hormuz blockade exposed the degree to which European pharmaceutical companies depend on Indian manufacturing — not just for generic APIs, but increasingly for the finished biologics and biosimilars that represent the fastest-growing segment of pharmaceutical spending. When that dependency became visible as a logistics risk, according to European policy analysts, the instinctive policy response was to call for reshoring and nearshoring. The Formycon deal, as observers note, announced in the immediate aftermath of that debate, goes in the opposite direction.
That tension, according to pharmaceutical industry analysts, is worth examining honestly. According to Formycon’s own statements, the company is not doing anything irrational. Biosimilar manufacturing, as industry experts explain, is capital-intensive, technically demanding, and highly sensitive to cost. A Bangalore facility offering end-to-end biologics manufacturing at Indian cost structures, according to CDMO market analysts, is a genuinely compelling proposition for a company trying to compete in the global biosimilar market against established players with deep manufacturing infrastructure. The deal, as Formycon’s CEO noted, reflects commercial logic that the Hormuz crisis has not — and probably cannot — override.
The proximity question
Bangalore, according to geographic data, is approximately 4,500 kilometres from the Strait of Hormuz. According to trade analysts, the crisis that disrupted Indian pharmaceutical exports between March and June 2026 — with exports falling 23.17% in March 2026 compared to the previous year, as reported by India’s Department of Commerce — affected Bangalore-based manufacturers through energy costs and logistics rather than through any direct threat to production facilities. OneSource’s facility, as the company has noted, was not in a conflict zone.
But the Hormuz blockade, according to supply chain risk analysts, demonstrated that geography matters in ways that just-in-time supply chains systematically underestimate. The route from Bangalore to European markets, as shipping data shows, passes through either the Strait of Hormuz and the Suez Canal, or around the Cape of Good Hope. According to maritime logistics experts, both routes were under varying degrees of stress simultaneously during the crisis. A deal that concentrates biosimilar manufacturing in Bangalore for European markets, as procurement specialists note, is a deal that concentrates European supply chain risk on those same routes.
That is not an argument against the Formycon-OneSource partnership. It is an argument, as European regulators have suggested, for being clear-eyed about what the partnership creates — and for European regulators and procurement bodies to factor route concentration risk into their assessment of single-source manufacturing agreements.
The broader pattern
Formycon is is just one company. But the pattern it represents, as pharmaceutical trade publications note, is industry-wide. According to India’s Department of Commerce, Indian pharmaceutical companies have been expanding global research partnerships across drug discovery, clinical research, AI-led drug design, and advanced manufacturing. The sector, as industry analysts explain, is explicitly moving from a volume-driven generics model to a value-driven approach targeting biosimilars, complex generics, and co-development arrangements that include intellectual property sharing.
For European companies, according to pharmaceutical executives interviewed by industry journals, the calculus is straightforward: partner with India for cost-efficient, scalable, regulatory-compliant manufacturing; retain R&D, clinical development, and market access in Europe. For European healthcare systems the calculus is more complicated: affordable biosimilars are unambiguously good for patients and payers, but the manufacturing dependency they create is a strategic variable that four months of Hormuz disruption has just made newly visible.
The Formycon-OneSource deal, according to the companies’ own statements, is a good deal for Formycon. Whether it is a good deal for European pharmaceutical security, as supply chain resilience experts note, is a question that the Iran war has just made considerably harder to answer.