Expansion Activity of CMOs

September 1, 2008
Patricia Van Arnum

Patricia Van Arnum was executive editor of Pharmaceutical Technology.

Pharmaceutical Technology, Pharmaceutical Technology-09-01-2008, Volume 2008 Supplement, Issue 4

The outlook is fairly optimistic as contract manufacturing organizations (CMOs) gather at CPhI Worldwide in Frankfurt. CMOs are expanding capacity for small-molecules, biologics, and finished-product manufacturing.

While contract manufacturers of active pharmaceutical ingredients (APIs), pharmaceutical intermediates, and finished products gather for CPhI Worldwide in Frankfurt later this month, the outlook for contract services is positive. Several large contract manufacturing organizations (CMOs) report healthy sales gains so far in 2008 and are proceeding with expansion plans in developmental and CGMP (current good manufacturing practices) capacity.

IMAGES COURTESY OF SAFC. BACKGROUND MOLECULES: CHAD BAKER/GETTY IMAGES

Lonza shows growth in small molecules and biologics

Lonza (Basel, Switzerland), one of the largest CMOs for small-molecule and biologics manufacturing, reported strong growth in the first half of 2008. Sales in its exclusive synthesis and biopharmaceuticals businesses increased 19.2% to CHF 765 million ($697 million) for the six-month period ending June 30, 2008. Capacity utilization in these businesses was approximately 90%, with a slightly higher level in biopharmaceuticals. The company also reported that restructuring measures initiated at its facilities in Baltimore, Maryland; Riverside, Pennsylvania; and Braine-l'Alleud, Belgium, facilities are all on track and contributed to improved profitability.

Exclusive synthesis. Led by gains in its small-molecule business, sales in Lonza's exclusive synthesis business increased to CHF 364 million ($331 million) in the six-month period ending June 30, 2008, up from CHF 242 million ($220 million) in the same period of 2007. The company is proceeding with several expansions. A small-scale, multipurpose CGMP API plant in Nansha, China, completed additional product validations during the first half of 2008. Construction of a corresponding large-scale API plant in Nansha is on schedule, and Phase I is expected to be completed in the second half of 2008. Further expansion phases in Nansha are in the planning stage, according to the company.

Lonza also expanded its technology portfolio with the addition of commercial-scale antibody drug conjugate capabilities and successfully completed commercial CGMP batches. The commercial-scale capabilities complement laboratory-scale and small-scale pilot-plant capabilities. Lonza is also expanding its fine-chemicals complex in Visp, Switzerland, for large-scale production of high-potency APIs (HPAPIs).

Biopharmaceuticals. Based on increased demand for mid-scale microbial manufacturing capacity, Lonza is expanding its microbial production facility in Hopkinton, Massachusetts, with the addition of a high-titer 2000-L manufacturing train. The new plant is scheduled to come on stream in March 2009. Lonza brought on line two large-scale microbial lines (15,000 L) at the company's Visp, facility, in 2007, and the lines are now fully operational.

In May 2007, Lonza broke ground for a facility for biopharmaceutical manufacturing technologies, support systems, and warehouses in Portsmouth, New Hampshire, where the company has large-scale mammalian cell-culture manufacturing capabilities. Lonza also added a 5000-L bioreactor to the existing facility. The company added a 500-L train at its mammalian manufacturing facility in Slough, England. Lonza began construction for a second large-scale mammalian facility in Singapore in 2007. The facility is scheduled to be completed and fully operational in 2011. A second large-scale mammalian manufacturing facility is scheduled for completion and operation in 2009.

Revised strategy. Lonza says it is expanding its contract- manufacturing business model to accommodate "pipeline agreements," in which the company and its pharmaceutical and biotechnology clients have the option to jointly develop and manufacture a pipeline of both chemical and biological products, an expansion from single-product agreements. Also, to focus on high-value-adding steps, the company is evaluating its outsourcing activities for low-value starting materials and intermediates.

SAFC invests in high-potency capacity

SAFC (St. Louis, MO) has invested $45 million in high-potency expansions during the past 18 months. In late 2007, it began operations of a new 600-ft2 HPAPI conjugation suite at its St. Louis, manufacturing facility. The suite is designed for producing early-stage clinical supplies and has capabilities to expand production into commercial scale in multikilogram quantities. The company invested $4.5 million to expand CGMP capacity on a pilot-plant and kilo-laboratory scale at its facility in Madison, Wisconsin. This investment follows a $12-million, 38,000-ft2 HPAPI expansion at its Madison facility, which was completed in 2006. SAFC is investing $29 million for a new facility for large-scale production of bacterial and fungal fermentation-derived HPAPIs in its Jerusalem, Israel, facility. The expansion is scheduled for completion in 2009.

Covance expands drug-development services

SAFC is proceeding with a $12-million expansion of its viral-product manufacturing facility in Carlsbad, California. The expansion is scheduled to be operational in the second half of 2009. The new suites will add 8000 ft2 of manufacturing space and enable 100-L batch production in stirred-tank bioreactors and 1000-L batch manufacturing in disposable bioreactors. These investments follow a $10-million expansion of commercial-scale API manufacturing and storage capacity, respectively, at its Arklow, Ireland, and Buchs, Switzerland, facilities in 2007.

Dr. Reddy's makes key acquisitions

To build its contract-manufacturing activities, Dr. Reddy's Laboratories (Hyderabad, India) completed two key acquisitions in 2008: Dow Chemical's (Midland, MI) Dowpharma small-molecules business associated with its Mirfield and Cambridge, United Kingdom, sites, as well as BASF's (Ludwigshafen, Germany) manufacturing facility in Shreveport, Louisiana, and related contract-manufacturing business for finished pharmaceuticals. The acquisition of the Dowpharma small-molecules business includes customer contracts, associated products, process technology, intellectual property, and trademarks as well as the transfer of the Mirfield and Cambridge facilities. Dr. Reddy's will also have a nonexclusive license to Dow's "Pfenex Expression Technology" for biocatalysis development.

The BASF acquisition includes relevant business, customer contracts, related abbreviated new drug applications and new drug applications, trademarks, as well as the Shreveport facility and related contract manufacturing activities. It also includes a tolling and supply agreement.

DSM reports gains

DSM (Heerlen, The Netherlands), which provides contract development and manufacturing services for small molecules, biologics, and solid-dosage and sterile products, reported gains in its pharmaceuticals business. Sales increased nearly 4% from EUR 425 million ($627 million) in the first half of 2007 to EUR 444 million ($652 million) in the same period in 2008. DSM recently added aseptic fill–finish manufacturing services for injectable cytotoxic products. The aseptic cytotoxic capabilities include flexible commercial scale fill–finish services for liquid and lyophilized products in vial sizes as large as 65 mL. In early 2007, DSM completed an expansion to its sterile parenteral manufacturing facility in Greenville, North Carolina. It added a clinical-trial-material manufacturing suite capable of manufacturing large- and small-molecule liquid and lyophilized products for Phase I–III clinical trials.

Aptuit adds chemical development services

In December 2007, Aptuit (Greenwich, CT) completed the acquisition of the chemical and pharmaceutical development) business of Evotec (Hamburg, Germany). Aptuit gained an API facility in Oxford, England, and a recently expanded parenteral (injectable vials) fill–finish facility in Glasgow, Scotland.

The Evotec acquisition is the latest move by Aptuit to strengthen its contract drug-development portfolio. Acquisitions in 2007 include SSCI, a solid-form research firm, and EaglePicher Pharmaceutical Services, which provides small-molecule synthesis capabilities, including HPAPIs.

Aptuit is also building its global footprint in India. In 2007, Aptuit and Laurus Labs Limited (Hyderabad, India) formed a new contract drug-development company, Aptuit Laurus (Hyderabad), as part of a phased acquisition. The deal positions Aptuit in the growing market for pharmaceutical outsourcing in India.

Aptuit Laurus will consist of a 160,000-ft2 research and development facility in Hyderabad, a large-scale manufacturing plant currently under construction in Pharma City, Vishakhapatnam, and Aptuit's existing informatics development and support group in Bangalore.

Aptuit says it plans to invest approximately $100 million during the next several years to build upon Aptuit Laurus's development, manufacturing, and informatics capabilities with the addition of a complete suite of development services, including medicinal chemistry, preclinical services, solid-state chemistry, consulting, clinical packaging and logistics, Phase I–IIa research, and large-scale dosage-form manufacturing. When these investments are completed, Aptuit Laurus will mirror the capabilities of services offered by Aptuit in North America and Europe. In addition, the new company plans to offer expanded services in discovery and clinical research and access to large-scale manufacturing at the backend of the product-development life cycle.

Patheon makes select investment and restructures

In secondary manufacturing, Patheon (Toronto) is expanding its Manati, Puerto Rico, facility to add a dedicated high-potency and controlled-substance manufacturing area. Patheon will invest a total of $2.8 million for a new 3386-ft2 area that will include three manufacturing suites, air-lock containment areas, and humidity-controlled air systems. The construction project is expected to be completed by October 2008.

Earlier this year, Patheon opened a new early-phase development facility in Milton Park in Oxfordshire, United Kingdom. The 13,500-ft2 , leased facility contains newly constructed formulation laboratories and a fully equipped analytical laboratory. The Milton Park operations will focus on the early-phase development of solid, semisolid, and oral liquid dosage forms. The facility includes GMP manufacturing areas for the production of materials for Phase I–II clinical trials. Patheon's "Quick To Clinic" programs, which accelerate molecules to clinical trials while minimizing API requirements, will be supported at the site.

These expansions follow recent restructuring. In April 2008, Patheon completed the sale of its York Mills facility located in Toronto for Can $12.5 million ($12.3 million). Patheon is transferring commercial production and development services undertaken at its York Mills facility primarily to its Whitby facility. A smaller portion of activity will be transferred to the company's Mississauga, Ontario, and Cincinnati, Ohio, facilities. Patheon is decommissioning the York Mills facility and has leased back the facility for as long as two years to facilitate this process.

In February 2008, Patheon completed the sale of its Niagara-Burlington commercial-manufacturing business to Pharmetics (Laval, Quebec, Canada), a privately owned contract manufacturer of vitamins, herbal products, supplements, and over-the-counter (OTC) pharmaceutical products. Pharmetics acquired the assets, including equipment, facilities, and land, at Patheon's facilities in Fort Erie and Burlington, Ontario. Collectively, the two sites currently serve 14 clients, manufacturing and packaging about 60 OTC pharmaceutical products in a range of dosage forms, including tablets, liquids, and powders.

Catalent strengthens biologics

Catalent Pharma Solutions (Somerset, NJ) will double its bioreactor capacity by adding a 1000-L bioreactor train in its Middleton, Wisconsin, facility by 2009. The expansion is in response to increased client demand for production to support clinical trials in Asia, Australia, Europe, and the US. Catalent supplies biotechnology companies with proteins made by its "GPEx" system, which produces stable, high-yielding mammalian cell lines for protein production.

Catalent also added a Phase I sterile vial-filling suite in its Research Triangle Park, North Carolina, facility, which complements the existing clinical and commercial manufacturing capabilities in its nearby North Raleigh facility. The new suite is designed to meet increasing market demand for early phase sterile-product development and manufacturing services. It will be equipped to fill vials with most highly-potent compounds, traditional small-molecule drugs and biologics, and controlled substances. Catalent has Phase I capabilities in blow–fill–seal and in prefilled syringes at its facilities in Woodstock, Illinois and Limoges, France, respectively.

Cook bolsters biologics capacity

Cook Pharmica (Bloomington, IN), the biopharmaceutical contract-manufacturing division of Cook Medical, will invest $80 million in an 80,000-ft2 expansion for parenteral formulation and fill–finish capacity. The expansion is scheduled to come on line in early 2010. The company also plans to open a new office and warehouse this year in Shanghai, China, for its customers in Asia.

Mid-sized players expand

Earlier this year AMRI (Albany, NY) opened its first in vitro biology laboratory in Singapore and completed a 10,000-ft2 laboratory expansion for medicinal-chemistry discovery services, more than doubling the capacity of its Science Park III facility. The in vitro biology group will test compounds synthesized by AMRI's Singapore-based medicinal-chemistry teams to provide potency data using cell-based or biochemical assays. AMRI anticipates hiring roughly 70 additional chemists and biologists to staff the Singapore facility during the next three years.

These moves complement AMRI's recent activity in Asia. In 2007, the company acquired the assets of Ariane Orgachem in Aurangabad and Ferico Laboratories in Navi Mumbai, India, giving the company two API and intermediates facilities in the country. AMRI also acquired additional land for expansion and plans to invest approximately $15 million to increase and upgrade manufacturing capabilities during the next several years.

Cambridge Major Laboratories (Germantown, WI) is expanding its large-scale API manufacturing with a new 120,000-ft2 manufacturing facility. The facility is designed for multiple GMP manufacturing suites capable of producing multiton quantities of APIs. The facility will initially feature six manufacturing suites with reactors as large as 2000 gallons. The facility will have complete isolation and containment, several vessels for hydrogenation and cryogenic reactions, and the potential to accommodate additional manufacturing suites to the 4000-gallon scale. Completion is scheduled for August 2009.

Carbogen Amcis's (Bubendorf, Switzerland) Indian subsidiary, Carbogen Amcis India, plans to open a high-potency facility in Bavla, India. The facility will be located on the Bavla site of its parent company, Dishman Pharmaceuticals and Chemicals (Ahmedabad, India). The facility's design and operation is modeled after Carbogen Amcis high-potency operations at its Bubendorf, facilities. The facility is expected to be operational by the first quarter of 2009.

Carbogen Amcis is part of Dishman Pharmaceuticals and Chemicals. Dishman acquired Carbogen Amcis in 2006 as part of a broader strategy to increase its global presence by acquiring Western fine-chemicals and pharmaceutical assets. In 2007, Dishman acquired Solvay Pharmaceuticals's (Brussels) fine-chemicals and vitamin businesses for an undisclosed sum. The deal included Solvay's Veenendal, The Netherlands, facilities, as well as the intellectual property rights for fine chemicals, vitamin D, and vitamin D analogues. In 2006, Dishman acquired I03S, a company specializing in ozone chemistry. In 2005, it acquired the UK-based contract research company Synprotec.

Earlier this year, Hovione (Loures, Portugal) purchased a 75% stake in China's Hisyn Pharmaceutical. The acquisition includes development laboratories in Shanghai and a 22,000-m2 API plant. Hovione's relationship with Hisyn started with the supply of intermediates, but this facility will now produce Hovione's two largest volume products, according to Hovione.