Speciality Chemicals Magazine NOV / DEC 2021 | Page 17

PHARMACEUTICALS
Marth – Most outsourced work is still in traditional fields
therefore cannot rely on their own manufacturing capabilities and that this will drive further growth in the industry . Meanwhile , Bottomley ventured that nothing is likely to stop the growth of the CDMO sector in the next two to three years . “ The only thing that could impact on it would be lack of candidates for
M & A ,” he said . “ We are now beginning to see questions being asked about where the next acquisition target is going to come from .” Unlike healthcare in general , the CDMO market is extremely fragmented . This , said Bottomley , creates opportunities for some . The CDMOs ’ clients , Big Pharma companies , are constantly trying to reduce their supplier base . In the CRO sector , this has created some very big players and it would seem natural for the same to happen in the CDMO sector . Many of the PharmaVentures ’ webinar participants expect this further consolidation to happen . Raabe noted that there are hundreds of small CDMOs and that the market should be driven by consolidation in the same way as pharma . “ It is unavoidable that at some point , smaller CDMOs will need a bigger roof ,” he said .
Marth has observed the M & A process from all sides as he was formerly CEO of Teva Pharmaceuticals ’ US business and then of AMRI ( now Curia ). “ You see this consolidation happening now ,” he told Walton , mentioning Catalent and Thermo Fisher among others . “ You are creating these larger and larger CDMO conglomerates , who become the manufacturing arm of Big Pharma .” As well as the challenges of integrating a former Big Pharma site into a CDMO , he continued , “ buying an existing CDMO today often cannot be done because the multiples are so high ”. For this reason , many buyers are doing what AMRI did of old , putting together a new CDMO from the assets and capabilities formerly within Big Pharma , if the fit is right . Big Pharma , Marth added , no longer needs or wants to ‘ do it all ’. Rather it is seeking to do what it does best : science and relationships
NOV / DEC 2021 SPECCHEMONLINE . COM
17