CPhI Worldwide returned to Frankfurt, Germany, on 24-26 October 2017. Sarah Harding spoke to top executives from Albemarle, Avara, BIOCAD, Bushu, Cambrex, Fine Organics, Johnson Matthey, Piramal, Robinson Brothers, Solvias, SPI Pharma, STA Pharma, Suparna, Uetikon, Umicore, Vertellus and others…
The 2017 CPhI Worldwide event in Frankfurt hosted more than 20 dedicated zones covering ingredients, APIs, excipients, contract services, packaging, biopharma and much more. Gathering experts and thought leaders from the entire pharmaceutical supply chain, this was the perfect opportunity to obtain their views on the latest developments, trends and technologies. With more than 45,000 visitors touring exhibitors across 11 halls, CPhI secured its position as the number one event for the pharma industry.
“The show’s fantastic – we’ve got some great leads,” said Ramesh Subramanian, Vice President, Strategic Marketing at Piramal.
It’s the event of the year – everyone is here!” said Roman Ivanov, Vice President for R&D at BIOCAD.
“All our customers are here and it’s a nice opportunity to meet with everyone,” said Marcelo Reinhardt, Senior Director of Business Development – Europe and South America, at C2 Pharma (formerly Centroflora CMS).
"As a company with customers and operations around the world, the CPhI events provide an opportunity for us to connect with customers and colleagues to discuss challenges and opportunities in the life science sector," commented Jim Keay, Business Director for Life Sciences at Vertellus.
Christophe Le Ret, Global Marketing Director at Umicore Precious Metals Chemistry agreed, saying “It’s the biggest event in this industry, and it’s very important for us… but we need to address the challenge of size versus efficiency.”
“It’s a good, convenient venue,” said Rudolf Hanko, CEO of Siegfried.
State of the industry
The global pharmaceutical industry was predicted to see moderate growth in 2017, and this appears to be holding true. Martin Arnold, Business Development Manager at Robinson Brothers, described the present as a “buoyant time in the industry, where people are trying to move projects forward.” Although, as stated by Xavier Jeanjean, Director of Sales and Marketing at Uetikon (a Novacap company) “Giving a long-term forecast, I would be very cautious,” the numbers of expansions and other investments hitting the news is testament to a broad confidence in the industry and its future.
In the words of Vertellus’s Jim Keay, “As the economy continues to expand, we are optimistic about opportunities across a breadth of sectors in the US and around the world.”
“We’ve made seven major expansions in 2017,” said Alex Maw, Director at Cambrex. “We have a strong market intelligence team that focuses on trends and opportunities that drive our investments.”
Piramal's Ramesh Subramanian noted that the company has made significant investments in India and North America to expand high potency API (HPAPI) capabilities, API manufacturing and sterile injectables, and plans to expand Phase I capabilities are afoot. “We are investing heavily,“ he said. “We are trying to predict trends, and investing accordingly.”
“In 2017, Vertellus launched a strategic planning process that led to a heightened focus on key areas of the business: plastics, preservatives for the personal care sector, and intermediates and actives for the agrochemicals sector,” explained Jim Keay. “Supporting our commitment to growth in these areas, Vertellus has invested in additional talent in the areas of engineering, marketing, market development and application development… We are also leveraging investments made in plant locations during 2016. For example, recent upgrades to the Nantong plant allow Vertellus to manufacture a full suite of Vitamin B3 products and support additional market demand.”
Avara Pharmaceutical Services has made several acquisitions in recent months – the company now has seven manufacturing sites, explained Bill Pasek, Executive Vice President and Chief Commercial Officer. With sites in the UK and Europe, Brexit might have been a cause for concern, but Jim Scandura, Executive Vice President and Chief Operative Officer waved such concerns aside, saying “It [Brexit] is going to be what it is, and we’re not going to worry about it.”
“Our custom synthesis business is almost fully booked until the end of Q1 2018,” commented Jürgen Rotzler, Leading Scientist and Product Manager Ligands at Solvias. “We see a continued demand for early phase development of small molecules. However the analytical service for biopharmaceuticals is our fastest growing section.”
Uetikon has also had a good year, according to Xavier Jeanjean. “We are expecting to finish 14-15% over last year, in terms of sales,” he revealed.
Bushu Pharmaceuticals recently acquired Spera Pharma, the CMC Function Group of Takeda. “This expands Bushu’s offering in R&D,” explained Katsuhiko Hatazawa, Senior Vice President & Head of Business Strategy. He added, “We help clients from development through manufacturing with a wide variety of services. We are a one-stop shop, offering integrated services, with extensive capabilities in small molecules. Our next challenge will be the technology for new modalities.”
Quality over cost?
One of the biggest challenges said to be facing the pharmaceutical industry is rising expectations from consumers who demand greater value for less cost. However, many companies still find that quality will always be the most important factor.
As Novacap‘s Xavier Jeanjean said, “Confidence is obviously an issue – quality and reliability are driving factors over price in this industry.”
“Customers are quality conscious and are prepared to pay for high quality grades,” agreed Mandal Suparna, Director of Suparna Chemicals.
Yu Lu, Executive Director, Corporate Development and Communications at STA Pharmaceuticals, commented that although China has historically been viewed as a low-cost provider, the situation is changing as API manufacturing has driven improvements in quality. “The quality of products we produce are held against a global standard,” she explained.
“The trick is to reduce costs while retaining quality,” said Dago Caceres, Global Strategic Marketing Leader for Dow. He says that Dow Pharma Solutions achieves this via two platforms for innovation: improving productivity and enhancing solubility. “For example, we can eliminate manufacturing costs by enabling production of CR tablets via direct compression, using our new METHOCEL Polymers,” he said.
Bernhard Paul, General Manager for Europe at Johnson Matthey (JM) agreed that “Customers want things quickly, more efficiently and cost effectively – these are key challenges,” he said. “But by using speciality technology, we can make things more efficient, and do it in a way that is sustainable and does not impact quality.”
James Rankin, Commercial Director at Fine Organics (now a Lianhetech company) said that there had been no noticeable increase in price pressures in 2017. “This has always been a competitive market,” he noted.
Price pressure is not the major problem of niche products,” advised Solvias’ Jürgen Rotzler. “The bigger issue with ligands & catalysts for homogeneous catalysis is the readiness of clients to support also the further development of new methodologies.”
Collaboration is key
According to Umicore‘s Christophe Le Ret, “Innovation in the industry is coming from collaboration, but pharma is missing a roadmap that shows where we want to be in 5 years’ time… Similar to the electronics industry, we need to agree set goals that we can all work towards.”
Collaboration is a big theme for Umicore. “Even if we have what a customer needs, we aim to collaborate to make sure it’s a perfect fit,” explained Umicore‘s Christophe Le Ret.
Bernhard Paul agreed, commenting that JM tends to create new products in partnership with others.
Jim Keay, Business Director for Life Sciences at Vertellus, expressed a similar focus on collaborative efforts. “We are aiming to do more contract development, rather than just manufacturing,” he said. “So we are looking for partners, possibly in the form of joint ventures, to move our R&D activities forward.”
Jeanne Thoma, President and CEO of SPI Pharma, sees opportunities in finding solutions for specific customer applications, such as patient friendly formulations for geriatric and paediatric populations, de-risking new product development, and increasing speed to market. Citing a new collaboration with Noramco as an example, Jeanne Thoma explained that SPI Pharma and Noramco with their complementary skill sets and product portfolios will help their customers to rapidly expand their pipeline and drive innovation. She said, “There has been a lot of interest from our customers since the announcement, so I believe we have identified a need in the market.”
Dow is also capitalizing on expanded formulation offerings – with the heritage in topical and transdermal products that the Dow Corning merger brought, Dow is one of the only companies that can offer the whole portfolio of dosage forms. “Sprays, ointments, syringes, liquid, capsules, soft gels… there’s probably not much we can’t do” said Gary Lord, Global Strategic Marketing Director.
“Across the board, the trend of outsourcing is strengthening and continuing… there is a good growth pattern,” said Rudolf Hanko, CEO of Siegfried.
Avara Pharmaceutical Services’ Jim Scandura agreed, noting that in a $250 billion market, the CMO market share is growing.
One of the topics of this year’s conference was the uptake of biosimilars in the US and Europe, which seems to be going some way to addressing this demand in western countries. Unlike generic medicines in which the active ingredients are identical to the reference small molecule drug, biosimilars are not identical – just ‘highly similar’ to the reference biologics.
“All biosimilars gave intrinsic variability – every batch differs from the last batch,” explained BIOCAD’s Roman Ivanov. “Quality is characterized by providing constant attributes, and it’s a complicated process. But when you achieve a good quality biosimilar, you are able to register it for all the indications of the original product… There are multiple examples of biosimilars having a huge impact in developing countries, but in a number of western countries, especially in those with government-funded healthcare, uptake is rapid because biosimilars can reduce the price of treatment by 60-70%.”
An ongoing question is how new manufacturing technologies may impact development and commercialization. A large focus of recent investments has been on ensuring that new facilities are as up-to-date as possible with the latest equipment.
For example, according to Marcelo Reinhardt, C2 Pharma invested $5 million in a state-of-the art, dedicated production facility in Vizag-India, for the manufacturing of digoxin, a life-saving API, while Suparna Chemicals has also recently ramped up their alkoxides manufacturing capacity with some new reactors. Another highlight for Suparna this year was achieving REACH registration for their potassium and sodium butylates.
“Digitization is key,” declared Uetikon‘s Xavier Jeanjean. “The world is changing and we need to adapt with innovation in practices and approach. We have an interior innovation group leading a think tank on digitization, looking at how to move forward. Novacap’s think tank on digitization is led by the company’s new rising star, Frederich Schab, Director of Innovation.
In a similar manner, SPI Pharma has an applied technical group, following a strategic review that identified the benefits of focussing on a more robust portfolio and increasing speed to market.
“One of the main advantages of our Chinese sites,” said James Rankin from Fine Organics (now a Lianhetech company) “Is that they are pharma-standard, built and designed in the past 5 years. Lianhe has invested heavily in China on a laboratory and commercial scale – they are using very advanced technology that is reducing costs and lead times.”
This is also true for STA Pharmaceuticals, now the largest process chemistry organization, employing more than 1000 scientists. It is about to open its third plant at it Changzhou site, and there are further plans to build another six over the next 5 years. Yu Lu explained, “We can now offer biocatalysis, transition metal catalysis, large-scale chromatography, continuous manufacturing, and a large-scale spray drier, so the site is now fully integrated from preclinical to commercial, from process development to manufacturing, all on one campus.”
JM's Bernhard Paul said, “JM is investing in new technology. We see a trend for the industry moving towards continuous processing, and this drove our recent agreement with Snapdragon Chemistry that enhances our offering in flow chemistry.”
Piramal has continuous flow equipment in India, and is also investing in biocatalysis, making chirally-pure molecules. Ramesh Subramanian explained, “Our idea is to use enzymes to drive optimal solutions for API… it ties in with our route-scouting initiative that provides better, more cost-effective manufacturing solutions for our customers.”
In addition, JM's Bernhard Paul sees small molecules becoming more complex and larger, which leads to bioavailability challenges. “Delivering API in a form that maximizes bioavailability is a big challenge,” he said. “This is an area where technologies like spray drying or hot melt extrusion can help get the API in an ideal form for our customers.”
The key, concluded Cambrex’s Alex Maw, is to bring in the technology when it meets a customer’s requirements to handle difficult chemistries and provide differentiation.
Avara Pharmaceutical Services’ Jim Scandura agreed, saying “Our customers drive our investments. For example, we recently invested in HPAPI manufacturing and sterile fillables, and as we acquire more sites we will acquire more technology… Lots of pharma companies are consolidating the numbers of companies they work with, so expanding our service offering in response to our customers enables a broader scope for partnership and collaboration.”
Piramal’s Ramesh Subramanian also highlighted the importance of investing in the technology to provide integrated services, saying “It’s a huge opportunity as people look to consolidate.”
“We’re not looking to be the biggest – just the best in the eyes of our customers,” concluded Avara’s Jim Scandura.