At the Biotechnology Industry Organization's (BIO) annual convention in Washington, D.C., the exhibit hall was a good place
to glean insights on industry trends. Here are a few I observed:
Improving yields for bioreactor-based mammalian cell culture is having a considerable impact on biopharmaceutical manufacturing. Expression
rates around one gram per liter are becoming the norm — nearly double the norm of just two years ago — and individual instances
of three to five grams per liter are being talked about.
Improved yields are an important factor in easing feared shortages in bioreactor-based cell culture capacity. They are also
dampening the prospects of a competing technology: transgenic production.
Proponents of transgenics have touted the technology as a more cost-effective alternative to bioreactor technology, especially
for large-volume applications such as monoclonal antibodies. It has been argued that the capital costs of building a transgenic
herd of goats or cattle are a fraction of the investment required to build bioreactor trains able to produce an equivalent
volume of drug substance. The improving expression rates, however, are halving and even quartering the amount of bioreactor
capacity needed to produce a given volume of material.
With their economic advantages fast disappearing, proponents of transgenic production are emphasizing their other supposed
advantage: the ability to produce proteins and antibodies that are difficult to express in bioreactors. As long as this advantage
holds up, it could preserve a niche for transgenic production. Still, the industry must deal with regulatory uncertainties,
concerns about animal safety, and, for plant transgenics, worries about contamination of other crops.
Linking biomanufacturing with fill and finish capability seems to be a new trend in the manufacturing sector. At BIO 2003, Baxter announced it is
offering cell culture manufacturing using capacity at its existing manufacturing facilities to complement both the fill and
finish capabilities of its Baxter Pharmaceutical Solutions unit in Bloomington, IN, and the delivery capabilities of its Baxter
Global Drug Delivery business. Cardinal Health revealed that it will have clinical-scale cell culture suites in the sterile
manufacturing facility it is completing in Raleigh, NC. Boehringer-Ingelheim, Abbott Laboratories, and DSM N.V. have separate
but complementary units offering biomanufacturing and fill and finish capabilities.
The linking of biomanufacturing and sterile fill and finish offerings is clearly aimed at offering smaller biopharmaceutical
companies a one-stop manufacturing solution.
Small-molecule process development contractors and API manufacturing contractors were in attendance at the convention too. The increased
presence of companies like Albany Molecular Research, Peakdale, Siegfried, and the custom manufacturing unit of Cambrex is
a clear sign that biopharmaceutical companies are diversifying their development portfolios to include small-molecule compounds.
Small-molecule manufacturers indicated that the business downturn they have experienced over the past three years may have
bottomed out. No one wanted to get overly optimistic just yet, but executives indicated that requests for proposals (RFPs)
and new project activity from both big and small pharma have been improving in recent months. One business development executive
said that his company's early-stage business has been up almost 10% in the past three months. Another executive indicated
that his company was seeing more projects, but at a smaller average project size than in the past.
Financing Activity Rises
One reason for the increased contractor activity may be the improving financial markets. Small- and mid-sized pharmaceutical
and biopharmaceutical companies picked up the pace of fund-raising in June.
According to data collected for PharmSource Information Services' Contractor’s Lead Sheet, these companies raised $2.9 billion
in June — more than double the $1.3 billion raised in April. The biotech sector was up 18% in the second quarter of 2003,
buoyed by a number of new product approvals.
The jump in new capital entering the industry should be a boon to contract research and contract manufacturer organizations
(a shortage of funding caused a rash of project cancellations and drug company liquidations over the past 12 to 24 months).
It remains to be seen, however, whether the environment has improved for the long-term or whether companies have been taking
advantage of a brief window of opportunity. BPI