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Piramal Pharma Solutions is diversifying the supply of critical pharmaceutical materials beyond China, not announcing a wholesale exit from the country. The company says it began its China Plus One initiative in 2019 and, by FY2025, had established alternate routes for 17 materials that had depended solely on China a year earlier. It reported that the share of critical materials without an ex-China source fell from 45% to 20% between FY2024 and FY2025.
What Piramal’s China Plus One strategy means
China Plus One means adding at least one country beyond China as a source for a material. Piramal’s stated approach is to spread supply risk while continuing to use China’s manufacturing footprint where it makes sense; the strategy is diversification, not proof that the company has stopped sourcing from China. Piramal Pharma Solutions’ strategy page describes the model.
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The effort began in 2019 in response to regulatory changes in China, according to the company’s white paper. Piramal says the work subsequently broadened into a supply-chain resilience program. The objective is to reduce dependence on a single country for critical starting materials and intermediates, while maintaining supply continuity and cost competitiveness.
What changed from FY2024 to FY2025
Piramal’s white paper gives a snapshot of the company’s progress, using the fiscal-year labels stated by the company:
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| Measure | Company-reported figure | What it indicates |
|---|---|---|
| Critical key starting materials (KSMs) or intermediates flagged | 67 in FY2024 | The set of materials assessed for supply-chain risk. |
| Materials classed as high risk because supply relied entirely on China | 30 in FY2024 | These were the materials with the clearest single-country concentration described in the report. |
| Critical materials without an ex-China supply source | 45% in FY2024; 20% in FY2025 | The reported share fell over the period. |
| Materials given alternate supply routes after relying solely on China a year earlier | 17 by FY2025 | Piramal says it had created alternate routes for these materials. |
| Remaining materials in the stated alternate-route goal | 13, targeted for FY2026 | This was a target, not a confirmed completion. |
| Value of Piramal Pharma Solutions’ sourcing from China | $32 million in 2022; $7 million in 2025 | The company reports a decline in sourcing value; the figures do not by themselves establish an exit from China. |
These are company-reported figures from Piramal Pharma Solutions’ China Plus One white paper. The source does not establish independent verification or specify the accounting scope behind each figure, so the numbers should be read as the company’s own account. Its FY2026 goal for the remaining 13 materials is an aim, not evidence that the work was completed.
How the company is building alternate supply
Finding another vendor is only one part of qualifying a pharmaceutical supply route. Piramal describes several connected actions:
- Map risk by material: identify which critical KSMs and intermediates depend on China and assess the exposure.
- Evaluate partners and vendors: assess custom-synthesis partners and identify alternate suppliers in India and other locations.
- Transfer technology: onboard suppliers by transferring the processes needed to make a material.
- Build in-house backward integration: add manufacturing capability at multiple sites to reduce reliance on external sources for earlier-stage inputs.
- Reduce intermediary dependence: integrate direct manufacturing where possible rather than relying on multiple intermediary steps.
These actions address different parts of the risk. A qualified second supplier offers another route; backward integration gives the company more direct control over production. Either can take time and investment, and the company’s stated aim is to balance resilience with cost competitiveness.
Why shifts are incremental
In a November 2025 Q2 FY2026 earnings-call transcript, Piramal Pharma CEO Peter DeYoung said the company saw “a general desire to de-risk from China.” He also cautioned that not every customer was moving in that direction and that some discussions were exploratory rather than finalized. He described possible shifts toward India for higher-volume needs and toward Western markets for other requirements, while noting that capacity and cost constraints limit how far customers can move. In some cases, customers may shift a percentage of sourcing rather than move wholesale.
Those remarks are management’s characterization of customer conversations, not an independent measurement of customer behavior across the pharmaceutical industry. They help explain why a China Plus One program can mean gradual allocation changes and additional qualified routes rather than a rapid or complete relocation of production. The comments appear in the Q2 FY2026 earnings-call transcript.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What the reported decline does—and does not—show
The reported fall in sourcing value from $32 million in 2022 to $7 million in 2025 is a notable company-reported change, but it is not enough to conclude that Piramal has exited China. The available figures do not identify which materials or volumes account for the change, nor do they specify the accounting scope. The more direct evidence of diversification is the company’s report that 17 materials gained alternate routes and that the share of critical materials without an ex-China source fell from 45% to 20% between FY2024 and FY2025.
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Overall, Piramal presents China Plus One as a way to reduce single-country exposure while retaining options in China. Whether it can establish further alternatives depends on supplier qualification, technology transfer, capacity and cost—the same practical constraints that make diversification different from simply switching a purchase to another country.
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