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Zydus Lifesciences and Sri Lanka's Sunshine Healthcare are investing over $20 million to build a pharma plant in Sri Lanka. The aim is to make more medicines locally in Sri Lanka. So, this will eventually reduce the country's dependence on imports.
The two companies have formed a joint venture called Zydus Sunshine Lifesciences Pvt. Ltd. Zydus will invest up to $5 million in one or more tranches to acquire 50% equity in the newly incorporated entity.
Why this matters: Sri Lanka imports a large share of the medicines it uses so this makes supply risky. If imports slow down or become expensive, medicines can become harder to find.
This plant will make medicines for Sri Lanka's retail market and improve access to affordable, quality drugs.
The why: the broader strategy for Zydus is to expand its international formulations business beyond its core US market.
For Zydus, this segment grew nearly 40% year-on-year to ₹3,070 crore, accounting for around 11% of its total pharma revenues in FY26.
Why Sunshine chose Zydus: Zydus have been present in Sri Lanka for the past 3 decades. It already understands the market there.
Meanwhile, Sunshine Healthcare already has a strong local network across pharma distribution, retail pharmacies, manufacturing and medical devices. So it makes a perfect match.
Big Picture: this JV sits inside the already set Free Trade Agreement (FTA) that allows Indian drug formulations to enter Sri Lanka at zero or minimal duties.
More recently, Sri Lanka officially recognised the Indian Pharmacopoeia. This means a wider pool of Indian manufacturers can now export medicines directly to Sri Lanka without additional regulatory friction.
