PHARMACEUTICALS
Figure 2 – Global value of therapy area by sales , 2023
to ask where can we find prefilled syringe capacity .” Diversification Cohen added , “ is really , really important in this industry . There will always be a body blow or two against a product , so having a basket of products that allows you to absorb what will inevitably happen .”
He also expects consolidation in the industry , given the “ real scarcity of CDMOS of scale ”, i . e . EBITDA over $ 100 million / year . “ Pharma needs to feel comfortable with their most prized possessions being in the hands of their service provider . They generally want more stable , larger organisations .”
Biologics lead the way
A surge of FDA approvals for biologics , particularly cell and gene therapy ( CGT ), has also created business for CDMOs in recent years . Glucagon-like peptide receptor agonists ( GLP-1 ) and antibody-drug conjugates ( ADCs ) are among the key drivers and will remain so ; a strong pipeline is expected to more than double ADC use by 2028 .
There is no doubt that biologics have been where the growth is : three times faster in general than small molecules . As Graham Lewis , VP of global strategy at IQVIA , pointed out in another keynote presentation , they accounted for 42 % of sales last years , up from 30 % in 2018 . They have also achieved scale .
The total value of biologics in 2023 was $ 559 billion , compared with $ 758 billion for small molecules . Speciality types , which are growing twice as fast as ‘ simple ’ small molecules , accounted for $ 228 billion of this ( Figure 1 ). The latter , Lewis said , have been the bedrock of the industry for 20-30 years but are becoming much less important from a value perspective , which raises questions about pharma companies ’ business models .
This will certainly continue , Lewis said , given that biologics account for most of the three big growth therapeutic areas that drive 40 % of global value and “ completely dwarf ” all others ( Figure 2 ): oncology ( where they are 53 % of total sales ), diabetes ( 64 %) and immunology ( 90 %).
The growth in these areas is expected to remain substantial and oncology will remain the clear number one , he added ; 35 % of all pipeline assets are currently in oncology and revolutionary new treatments , such as ADCs and CAR-T , are already coming through .
Biological investments
The focus on biologics among CDMOs was certainly clear in the company presentations made at DCAT Week or separately either side of it . Added together , these will bring considerable extra capacity into the CDMO sector .
Among the big CDMO players , Korea ’ s Samsung Group is planning a new ‘ Bio Campus II ’ in Korea . This will add 720 m 3 of capacity , bringing the total to over 1.3 million by 2033 . Key capabilities will include preclinical cell line manufacturing , drug substance ( DS ) manufacture at 1-15 m 3 scale and drug product ( DP ) in liquid and lyophilised vials .
The first , fully cGMP plant will be operational in April 2025 with 180 m 3 of capacity . In parallel , said Kevin Sharp , head of global sales , Samsung is adding two building for the conjugation of ADCs that will be operational in January 2025 . It is also investing in firms active in payload technology , peptide linkers and ADCs for solid tumours .
Lonza agreed to acquire Roche- Genentech ’ s 330 m 3 mammalian biologics site in Vacaville , California , for $ 1.2 billion . This is one of the largest sites of its kind in the world . Lonza plans to invest about $ 350 million to upgrade it . “ This will add significant new capacity to our network and enable us to support a growing global need for high quality , large-scale mammalian manufacturing at a site that has already been proven to deliver high quality products ,” said Jean- Christophe Hyvert , president of Lonza Biologics .
India ’ s Syngene announced that its newly upgraded , $ 98 million biologics
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