Fine Chemicals

A whole new world

A very different Isochem has emerged ten years on from the Grande Paroisse disaster. Andrew Warmington was at a company event in Paris

Few companies in the fine chemicals industry will have been through as much change and trauma in the past decade as Isochem. The company that has emerged, however, has a story to tell that is about far more than just survival.

On 21 September 2001, just ten days after 9/11, a devastating blast rocked AZF's fertiliser plant at Total's Grande Paroisse subsidiary Toulouse, France, causing many deaths and injuries. Terrorism was first suspected and still is in some quarters, though it was actually an accident. One thing is certain: Isochem's large-scale phosgenation activities at the site, which demonstrably had nothing to do with the explosion, were permanently shut down and this badly hurt the company.

At the time, Isochem, uniquely among Western fine chemicals firms, had been fully state-owned for a decade as part of SNPE, a giant in explosives, rocket propellants and other fields. Since then, the political wind has changed and SNPE has been broken up. It now employs only ten people and its once plush offices by the banks of the Seine in Paris are currently being converted into luxury flats.

This process was completed in 2010, when Aurelius, a diversified private equity company based in Munich, acquired Isochem and named one of its own executives, Bjorn Schlosser, as president.  Sales director Xavier Jeanjean now heads a team of four regional business managers plus one more with responsibility for non-pharma applications. All are based within the same office at the headquarters in Vert-le-Petit, east of Paris.

At the end of November, this team presented itself to a diversified group of CMC and sourcing consultants, technology manager, distributors, import/export representatives, database companies, journalists and others at its first  'Pharmaceutical Custom Manufacturing Congress' in and around Paris.

The company, Jeanjean said, now has five sites, of which three are GMP and two FDA-audited. Four are in France, including three in the Paris region at Vert-le-Petit, Pithiviers and Gennevilliers. Sales were about €100 million last year and they should increase to €105 million this year, with employment levels falling from about 500 to 480.

The company turnover divides up roughly 55% in pharmaceuticals, 25% in agrochemicals, 7% and rising in personal care and the other 13% among many others. These are very diversified but include some very interesting niches, such as varnishes for anti-scratch coatings on glass.

Isochem's pharma-related business is divided between exclusive industrial custom synthesis of APIs and regulated and non-regulated intermediates from development to production, including route selection, process and analytical development and process optimisation, and proprietary products for generic APIs.

Vert-le-Petit is the headquarters of the new Isochem

The former, which accounts for about two thirds of the company total, is stable, as weak demand growth is being partly counterbalanced by customers returning from China for more reliable supply and/or greater transparency in sourcing key starting materials, though Isochem itself is seeing growth. The latter is growing as more and more blockbusters go generic. Jeanjean also sees growing potential in the emerging markets as customers.

Within the exclusive synthesis section of the market, there is little growth from the medium to large drugs companies, who typically outsource key starting materials or specific technologies like phosgenation, increasingly to preferred suppliers. Smaller companies, partly because they are the real drivers of innovation in the market and partly because they have far fewer - if any - manufacturing capabilities and need to outsource almost everything, are the real growth drivers.

In technology terms, the SNPE heritage is very much in evidence. As one of the regional business managers, Amélie Arbore explained, the core know-how at Isochem is the safe implementation of hazardous reactions, including phosgenation, nitration and nitrosation, reductions with complex hydrides and high pressure hydrogenation. This is supplemented by a wide range of other chemistries.

The five sites have a combined 450 m³ of capacity, 60% of it to GMP. This includes glass-lined and stainless steel reactors of 100 to 25,00 litres with a full operating range from -70°C to +250°C and the ability to handle toxic and hazardous chemicals from laboratory to industrial scale.

The two stand-out capabilities are phosgenation and hydrogenation, supplemented by all types of solid and liquid isolation capabilities. Vert-le-Petit can handle GMP phosgenation at all scales up to 6,000 litres and also produces such sophisticated derivatives as NCA and UNCA, complementing the non-GMP capabilities at Pont-de-Claix near Grenoble and the Hungarian subsidiary, Framochem.

Isochem also has hydrogenation capabilities that include homothetic lab reactions, scale-up methodologies and both glass-lined and stainless steel industrial-scale reactors of 1,000-8,000 litres capacity for conventional batch hydrogenation at 3 bar. The Pithiviers site has perhaps the single most impressive piece of kit: a 2,000 litre hollow-shaft Hastelloy gassing reactor from Biazzi that can carry out the more stringent hydrogenations at up to 40 bar and temperatures of up to 160°C.

The heart of the Paris presentations, however, came from two technical and scientific director Yves Robin and another regional business manager, Vincent Guillot, on project management at all stages of the process from RFP to production. They presented case studies of work Isochem had done with customers and partners that, they said, showcased the five key project management skills of transparency, appropriate and effective communication, teamwork, agility and being a solution provider.

"What makes the difference?" asked Robin, rhetorically. "Is it our track record, our technology, our equipment? Other companies have all that too. What makes the difference is people. The success of any project relies on people to manage it. For us, project management starts when a business manager's phone rings with an RFP and last through to project completion."

(L-R) Yves Robin, Vincent Guillot, Amélie Arbore and Xavier Jeanjean are key members of the business management team

Transparency, Guillot said, means that all of the important information is made as available as it would be within a customer's own team and that all critical decisions are made with and for the customer.  This covers assumptions of what is and is not possible, full technical and cost data sharing and planning and project ends.

In one case, transparency in QA and the supply chain were crucial in a project where Isochem was a key supplier of a lead API to a Medium Pharma company. The solution was to give the customer full access to batch documentation and involving him in the batch release process, managed by weekly detailed production planning and using an Extranet. This all enabled Isochem to optimise the supply chain throughout the API's life cycle and ultimately to remain the key producer right through to when the drug went generic.

Appropriate and efficient communication, according to Robin, means having project-specific tailored communication plans. This involves regular reporting and project reports and documents being made available on customer request, including via an Extranet for document sharing, and using other IT tools for knowledge management. Every project has a dedicated business manager and a dedicated project manager at Isochem.

In one example, Isochem was making several key starting materials and advanced materials for a US Emerging Pharma company's API with communication at the frequency the customer wanted. As the project went through to scale-up and DMF, the customer's needs changed, QA documentation became more complex and there were some tricky questions from the FDA. This meant that operational, strategic and investment decisions had to be made jointly.

An Extranet was set up to close the geographical distance between them and make communication faster and more reliable. In addition, all strategic and operational decisions were made around a virtual table by a joint operating and steering committee that could understand the project at a high level and make key decisions rapidly.

Teamwork, Guillot said, requires a strong team spirit on both sides. All involved must understand their roles, be committed to the project and be aware of its status at any given time. His case study came from personal care, where a customer that did most of its manufacturing in-house wanted a back-up producer for active ingredients. This required a quick transfer of technology relating to several products.

The solution here involved creating direct communication channels between the respective technical teams, as well as the project leaders. Isochem therefore invited the customer's technical team to see scale-up and first production at its site, while also implementing process improvement. In five years, Isochem went from doing no business at all with the client to being a preferred supplier.

Reactor at the Gennevilliers site near Paris

Projects never, ever go exactly according to plan and CMOs should always expect the unexpected; this is what agility means, in Robin's view. Isochem addresses this by inserting more frequent milestones into projects and giving continuous updates to customers. It also adapts its tools, resources and competencies to achieve the expected targets on time, with rapid support from the key business managers.

Isochem's agility was once tested when it was the sole approved supplier for a four-step process of a cosmetic active ingredient. Ten months before the anticipated launch in the West, the client also decided that it wanted a back-up solution in Asia for two steps of the process so that it could also launch the product in the lower cost markets, without changing the original timeline. This, said Robin, "came as a shock to us".

Isochem top management therefore decided to ensure that it adapted quickly to running two projects at the same time. It found a manufacturer in Asia and transferring two of the steps there, implemented more frequent milestones and followed up the technology transfer to ensure that it went through rapidly and smoothly.

To be a solution provider, Guillot concluded, means that both the project team and the management must be solution-oriented. Isochem has set up an early warning system to provide visibility in tasks, planning and costs, while looking for balanced solutions that manage issues and problems proactively, emphasising risk management and alternative systems, all with support from top management.

In one instance, Isochem was developing an API synthesis for a dry peptide for a US Emerging Pharma company. A problem arose in that polymorphism studies found five forms of the API, while the preferred one was not the most stable and was also poorly stable in most solvents. It was difficult to know how to take the project forward.

With full change control from the customer, Isochem added two key participants to the project team - one from the custom synthesis firm involved, Switzerland's Solvias, and an academic expert on crystallisation. They quickly developed a solution based on a mixture of solvents that took the project forward without any delay.

"Isochem has emerged in its present form with no debt and is ready to invest," Schlosser told the meeting. "We don't seek to be the biggest company in the fine chemicals industry but to be more agile, quicker and customer-oriented." It was because of this and the increasing need to reach out to small and medium-sized potential customers that Isochem is now organising somewhat unconventional gatherings like this.

Few specific details of planned investments were given, but Jeanjean noted that Isochem plans to launch some new thioisocyanate derivatives made by a new chemistry rather than the conventional thiophosgene route. These should be available in early 2012 in time for communication at Chemspec Europe. Having joined Britest in 2011, the company is also looking at process improvements of all kinds. "We are full of hope for the future," he concluded.

 

 

From Online Issue: December 2011