Piramal Pharma Solutions is reducing the risk of relying on China as the sole source for critical pharmaceutical materials—not announcing a wholesale exit from China. Its China Plus One strategy adds suppliers or manufacturing routes in other countries while retaining the option to use China’s manufacturing base.
What Piramal’s China Plus One strategy means
China Plus One is a supply-diversification approach: add at least one country beyond China as a source for a material, rather than depend on a single country. Piramal Pharma Solutions describes the goal as greater resilience without giving up the benefits of China’s manufacturing footprint. A decline in reported China sourcing value therefore does not, by itself, show that Piramal has stopped buying from China or moved every material elsewhere. Piramal Pharma Solutions’ strategy page explains the company’s definition.
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What has changed in Piramal’s reported figures
Piramal says the initiative began in 2019 in response to regulatory changes in China and developed into a broader supply-chain resilience program. The company’s white paper reports these milestones:
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| Measure | Company-reported figure | Period or status |
|---|---|---|
| Critical key starting materials (KSMs) or intermediates flagged | 67 | FY2024 |
| Materials classed as high risk because supply relied entirely on China | 30 | FY2024 |
| Critical materials without an ex-China source | 45% to 20% | FY2024 to FY2025 |
| Materials given alternate supply routes after relying solely on China a year earlier | 17 | By FY2025 |
| Remaining materials targeted for alternate routes | 13 | FY2026 target stated in the white paper |
| Value of Piramal Pharma Solutions’ sourcing from China | $32 million in 2022 to $7 million in 2025 | As reported in the white paper |
The counts, percentages and dollar values are company-reported. The white paper does not establish independent verification or specify the accounting scope behind each figure. The 13-material figure is a stated FY2026 goal, not confirmation that the work was completed. The figures and strategy details are in Piramal Pharma Solutions’ China Plus One white paper.
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How the company is building alternate supply
The approach combines several methods rather than relying on a single replacement supplier:
- Map exposure by material. Piramal assessed critical KSMs and intermediates to identify where supply depended on China alone.
- Qualify alternate vendors. The company says it evaluated custom-synthesis partners and identified potential suppliers in India and other countries.
- Transfer technology. Technology transfer helps onboard suppliers so an alternate route can produce the required material.
- Integrate manufacturing. Piramal reports adding in-house backward integration at multiple sites and reducing reliance on intermediaries through direct manufacturing integration.
These measures are intended to protect continuity while maintaining cost competitiveness. Qualifying another source can make a supply chain less concentrated, but it does not mean the new route immediately replaces existing production or can meet every volume requirement.
Why the shift is incremental
On Piramal Pharma’s November 2025 Q2 FY2026 earnings call, CEO Peter DeYoung described a general customer desire to reduce China exposure. He also cautioned that not all customers were moving in that direction and that some discussions were exploratory rather than finalized. Capacity and cost can limit how far and how quickly customers shift; the company described possible percentage changes rather than wholesale moves.
DeYoung said that higher-volume needs may shift toward India, while some other needs may be directed to Western markets. These are management’s observations, not an independent measurement of customer behavior across the pharmaceutical industry. The Q2 FY2026 earnings-call transcript provides the surrounding context.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What the numbers do—and do not—show
The reported reduction in sourcing value from $32 million in 2022 to $7 million in 2025 is evidence of a change in the company’s reported China sourcing value. It does not reveal which specific materials were affected, establish the full destination of sourcing, or prove that China has been removed from Piramal’s supply chain. Likewise, reducing the share of critical materials without an ex-China source from 45% to 20% indicates that more materials had an alternate source by FY2025, but does not say how much each source can supply.
The company’s figures are specific to Piramal Pharma Solutions and the periods stated; they should not be generalized to all of Piramal Pharma, all pharmaceutical manufacturers, or the industry as a whole. Piramal Pharma Limited’s company overview provides broader corporate context.
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