Strong markets , multiple modalities
Pharmaceutical CDMOs are continuing to invest in a buoyant market . We report from CPHI Frankfurt
The mood among CDMOs remained buoyant at the rebranded CPHI Frankfurt show , which took place on 1-3 November and drew 40,405 visitors from 167 countries , a 75 % increase on 2021 . There were several announcements of major investments and most of the exhibitors SCM spoke to were optimistic about continued rapid growth , particularly in new modalities of all kinds .
This feeling was reflected in new research from the CPHI Annual Report 2022 , launched during the show , which forecast that “ huge volumes of venture capital and private equity cash reserves will drive significant expansion in demand for CRO and CDMO services in the next two years ”.
The cash ‘ overhang ’ stood at $ 1,049 million as of June 2022 .
For the past two years , noted report author Brian Scanlan of Edgewater Capital and previously with Cambridge Major Laboratories , forerunner to Alcami , this money has poured mostly into biotechs . Now , these companies have two to three years of cash reserves behind them . As they advance more targets within the time frame of their investors , they will be pouring cash into development and manufacturing services .
Strong growth continues
Among the most bullish of the CDMOs was India ’ s Aragen Life Sciences . Helped by a $ 350 million investment from Goldman Sachs , it has increased its revenues by 20 % and its margins by 30 % while employee numbers have risen from 2,400 to 2,000 . This earned CEO Manni Kantipudi the CEO of the Year award at the CPHI Pharma Awards “ for delivering outstanding performance with sustained growth and robust strategies ”.
Among the investments have been two new buildings for drug discovery and development , plus acquisitions to fill gaps in drug product and toxicology capabilities . A new drug product facility will open in Bengaluru at the turn of the year . Aragen is the largest CDMO in India but , said CCO Dr Ramesh Subramanian , “ we don ’ t want to be a CRO or CDMO , our aim is to be a modality-agnostic R & D
Cambrex will add a new facility at Minneapoilis
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