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BT-Capacity Worries Fade for Biomanufacturing

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  82   Pharmaceutical Technology  JULY 2003   www.pharmtech.com Capacity Worries Fade for Biomanufacturing  Jim Miller OUTSOURCINGOUTLOOKOUTSOURCINGOUTLOOK Jim Miller is president ofPharmSource Information Services, Inc., and publisher of Bio/Pharmaceutical Outsourcing Report  , tel. 703.914.1203, fax. 703.914.1205,info@pharmsource. com,www.pharmsource.com. SM (Heerlen,the Netherlands) announced that it is moving ahead with theconstruction ofa commercial-scale bio-manufacturing facility in Montreal,Canada.The new facility will adjoin the existing DSMBiologics facility in Montreal.The building’sdesign will incorporate four bioreactors formammalian-cell culture,with a total capacity of60,000 L,and full downstream pro-cessing capabilities.The plant is being built in twophases.The first phase includes thebuilding and all necessary infrastruc-ture to support the four bioreactor op-erations,but only two 15,000-L unitswill be installed.This phase will cost alittle more than $100 million and is ex-pected to be on stream by mid-2005.No target date has been set for the sec-ond phase,which will add another30,000 L ofcapacity.The Société Générale de Financement duQuébec (SGF),a quasi-governmental agency,will finance 40% ofthe investment.SGF helpedfinance the srcinal DSM Biologics facility inMontreal and is part-owner ofthe enterprise.The DSM investment represents the largestcommitment to new cell-culture capacity since Lonza (Zurich,Switzerland) announced its planto build 60,000 L (3  20,000 L) ofcapacity atits Portsmouth,New Hampshire,location two years ago.Lonza’s manufacturing capacity is ex-pected to come on-line in mid-2004 and is al-ready 90% committed following a large-scalemonoclonal antibody supply agreement thatwas signed in May 2003 with an unnamed top-10 pharma company.Another major contractor adding cell-culturecapacity is Diosynth ,whose new facility in Oss,the Netherlands,will house an 18,000-L biore-actor.Among other major contract biomanu-facturers, Avecia (Manchester,UK) has focusedon new microbial capacity,and Dow Chemical (Midland,MI) seems to be holding offon new capacity commitments at its Rhode Island facility.Controlling the availability ofcontract mam-malian-cell culture capacity is a challenge.Companies are moving in and out ofthe mar-ket as their strategies or in-house capacity re-quirements change.Sponsors with excess capac-ity,including GlaxoSmithKline (Brentford,UK), Abbott Laboratories (Abbott Park,IL), Idec Pharmaceuticals (San Diego,CA),and Abgenix  (Fremont,CA) are actively selling theirexcess capacity.Other sponsors with excess ca-pacity are using their manufacturing capabili-ties as leverage when negotiating alliances.After talking to industry insiders,it is clearthat the catastrophic supply shortfalls that someobservers were forecasting are not coming topass.According to Howard Levine,president of  BioProcess Technology Consultants (Concord,MA),the projections were often faulty assump-tions regarding dosage requirements,approvalrates,and the market’s ability to absorb all of the new products.According to Levine and other industry pro-fessionals,contract capacity for process devel-opment and the biomanufacturing ofclinicaltrial materials is in short supply.The clinicaltrial materials business can be very volatile—both Lonza and CambrexBio Science (EastRutherford,NJ) have suffered significant rev-enue and earnings shortfalls this year because of clinical project cancellations and delays.How-ever,even in this difficult funding environmentfor early stage companies,the demand for clini-cal manufacturing is high.The high demand is what keeps companieslike Cambrex Bio Science investing in the clini-cal markets.According to its president,Petervan Hoorn,Cambrex Bio Science recently opened a new process development laboratory in Baltimore,Maryland,andis installing a 500-Lstirred-tank mammalian-cell culture bioreactorthat will begin operation at year’s end.Thecompany is also installing a 2500-L microbialreactor train at its facility in Hopkinton,Massa-chussets,which will come on-line in mid-2004.Small companies adding clinical cell-culturecapacity include Laureate Pharma (Princeton, The DSM investment puts biomanufacturingcapacity in the spotlight.Contract biomanufacturersare adding new capacityand sponsors aremarketing their excesscapacity.   D  84   Pharmaceutical Technology  JULY 2003   www.pharmtech.com Outsourcing Outlook NJ) and Henogen (Charleroi,Belgium).Laureate Pharma recently installed a 200-L bioreactor,and Henogen re-cently acquired 4C Biotech (Seneffe,Belgium) which provides clinical-scalebiomanufacturing. Baxter expands parenteral operations One segment ofthe market that seemsassured ofhaving plenty ofcapacity iscontract parenteral manufacturing.Fill-and-finish contractors are in the midstofa $400–500-million investment boomthat will substantially increase fillingand lyophilization capacity. Baxter Pharmaceutical Solutions (BPS) (Bloomington,IN) recently an-nounced a massive investment program.BPS will invest $100 million in a120,000-ft 2 expansion ofits parenteralmanufacturing capacity,which will in-clude more filling lines for vials and pre-filled syringes,a new lyophilization unit,and laboratory space.The expansionwill nearly double Baxter’s prefilled sy-ringe capacity to allow for approxi-mately 235 million units annually.Theexpansion program will be spreadthroughout seven years,with the new capacity from the initial phase expectedto be in operation in 2005.Aside from the scale ofthe invest-ment,the BPS announcement is signifi-cant because it indicates that BPS clientswill have access to parent company Bax-ter Healthcare’s portfolio offormulationand drug delivery technologies forpoorly soluble drugs.Thisportfolio includes the Nano-edge technologies that Bax-ter licensed from RTPPharma in 2001 and thecontrolled-release proteinand pulmonary delivery technologies that Baxtergained when it acquiredEpic Therapeutics,Inc.,in2002.Formulation technology may begin to rival processtechnology as a competitivefactor in the fill-and-finish sector.Withso much investment in capacity,compa-nies will try to differentiate themselvesalong other dimensions. AAI recommits to service business AAI Pharma (Wilmington,NC) hasrenamed its contract services unit fromAAIInternational to AAI DevelopmentServices and has undertaken several ini-tiatives to upgrade its contract servicesofferings.The move is part ofan effortto get AAI Pharma’s services businessback on track after more than a year of declining revenues and profits.Develop-ment services revenues of$82.4 millionin 2002 were down 11% from 2001,andfirst quarter 2003 revenues of$20.2 mil-lion were down 13% from the yearbefore.In its announcement ofthe namechange,the company said it is “under-taking a renewed commitment to get-ting the job done right and on-time forcustomers.”In particular,AAI Develop-ment Services is realigning its sales andcustomer service–project managementstaffto work together in client-focusedteams that will give the client a singlepoint ofcontact,according to StephenCottrell,executive vice president forsales and marketing.The company also announced severalinvestments to upgrade its capabilities.These investments include a $2-millionrenovation ofits solid dosage manufac-turing facility in Wilmington,NorthCarolina,a 50% increase in storage ca-pacity,and the addition ofexplosion-proofcapabilities for handling alcohol-based products at its Charleston,SouthCarolina,facility. PT Circle/eINFO 55    B   A   X   T   E   R   P   H   A   R   M   A   C   E   U   T   I   C   A   L
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