With a fresh infusion of capital, a new executive team, including a new CEO and president, and a new board, Patheon brass
decided to give the company a fresh new look, a new beginning, and an opportunity to embrace a new vision. The name remains
the same, says CEO Wes Wheeler, who joined the company in December 2007, to reflect the company's "heritage of quality and
However, he adds, "we put the name in lower case to project a more people-friendly, compassionate company. We changed the
logo color to green to reflect a fresh new start, and to venture into colors that none of our competitors own to convey that
we are unique. The unique 'P' in the logo ... called the 'infiniP,' signifies our commitment to continuous improvement. The
new slogan 'Performance the world over' reminds our customers that we have a global footprint, and are committed to proving
through metrics that we get the job done."
Wheeler recently took some time to share his perspective on the challenges and opportunities that lay ahead for contract service
providers with Pharmaceutical Technology. What follows is a transcript of that talk.
Wes Wheeler CEO and President, Patheon
» What is your overall assessment of the market for contract service providers?
»Wheeler: We operate in two areas of that market. Twenty percent of our business is in pharmaceutical development, 80% in commercial
manufacturing. So I can speak to those two markets specifically.
Our original concept in the development market was to bring products in when manufacturing was being scaled up for Phase II
and III clinical trials. This would load our pipeline for commercial manufacturing. Now, however, we treat development as
a separate business and offer services for formulation and process development for Phase I trials. Then, if we are lucky,
we transition these drugs to our commercial manufacturing units.
PharmTech» What in the market changed to motivate Patheon's change in approach?
»Wheeler: In the old days, contract manufacturing organizations (CMOs) were awarded 'tail' products—that is, products that were further
along in their life cycles, so that the clients could free up their capacity for newer products. We like those 'tail' products,
but we're a bit selfish in that we also want to get products that are at an earlier stage in their life cycle. It gives us
growth in volume and better stability.
PharmTech» That implies a change in Big Pharma's approach to outsourcing. What are your thoughts in this regard?
»Wheeler: Several of the large pharma companies are coming to us to help develop new products, which has been a nice change. So we
have both the large companies and the smaller 'virtual' companies which have traditionally outsourced to us. We can offer
all of them full formulation development, analytical services, and scale-up.
PharmTech»Why do you think pharma is bringing you earlier-stage projects?
»Wheeler: Pharma companies are outsourcing up to 30% of their development, and that number is expected to grow to 40%. The trend by
pharma to outsource development is motivated by a desire to reduce cost, temper the ebbs and flows, and manage risk.
PharmTech» I hear it said that pharma companies are varying their product mix. Is this accurate?
»Wheeler: Yes. Traditional pharma is moving into biologicals and biotechs are moving into small molecules. The two types of Big Pharma
companies are becoming one.
PharmTech» What do you think the market is for development services?
»Wheeler: We estimate that market to be about $10 billion annually. We have between 2–3% of that market and have high expectations
for our ability to grow.