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CPhI North America: Optimistic outlook for fine chemicals, pharma ingredients

April 27, 2018
Chemical Value Chain

Makers of fine chemicals pharmaceutical ingredients expressed optimism about business and growth prospects at this week’s CPhI North America conference in Philadelphia. Investment in pharmaceutical development has been strong and demographic and economic trends are generally favorable for the industry. Meanwhile, manufacturing processes and footprints continue to change.

“The industry is very happy generally,” says Elliott Berger, v.p./marketing and strategy at Catalent. Funding has been strong both from big pharma and venture-capital-backed biotech firms, Berger adds. Reform at the US FDA is also a boon. “The current FDA is focused on getting as many drugs to market as efficiently as possible,” Berger says.

Multiple attendees cited aging populations, especially in the developed world, as a key growth driver for fine chemicals and pharma manufacturers. DowDuPont “has lots of oral solid dose products, and people living longer will need more of that,” notes Nick Grasman, lead market manager/food, pharma and medical at Dow. Dow, DuPont and FMC are currently bringing together their pharma excipients businesses, which will be under one umbrella at the future DuPont after the DowDuPont spin-offs.

Another positive demographic trend is the rise of the middle class in emerging markets. “There is expanded access to medicine by a broader group…including in the developing world,” says Garrett Dilley, senior director/business development at Johnson Matthey. This also can have an impact on product development, as different patient population may have different needs.

Diversifying development

As developing markets such as China and India mature, they are also growing new capabilities in fine chemicals and drug development. “Over the next ten years, there will be a big China for China and India for India market,” Berger says. “The economies there will eventually support drug development.”

In China, this is already starting, albeit on a relatively small scale. “We are seeing…innovative venture-backed biotech in China,” Dilley says. Johnson Matthey has been working with such firms recently – in a space that didn’t exist in China as recently as a few years ago. “It’s just in the past couple of years…that it’s developed to a point where they are ready [to work with external partners,” Dilley says.

This is not necessarily bad news for Western pharma ingredients suppliers. CPhI attendees note that industry growth is driven by big macro trends such as aging populations and the growing developing-world middle class, and that geographically diverse drug development and manufacturing can mean more opportunity. In recent years, the ‘reshoring’ trend, for example, has seen some pharma ingredient manufacturing come back to the West – but has also forced Chinese and Indian suppliers to improve quality, and meant that significant capacity remains in those countries. The end result is a broader, more diverse industry with manufacturing and R&D nodes in multiple countries. “We continue to see manufacturing moving around,” Grasman says. “It can be in any geography. You really need a global view in pharma.”

Continuous manufacturing processes are likely to be critical wherever manufacturing is located. “There has been a much stronger utilization of continuous manufacturing [recently],” Dilley says. “It was talked about for ten or fifteen years, but a couple of companies had to be first movers. Big pharma has taken the lead on this and smaller biotech firms have followed.” Continuous manufacturing processes mean that scale-up, often a source of uncertainty in pharma, can be done more efficiently and cheaply. It can improve strategic and corporate planning as new drugs near commercialization, according to Dilley.

Continuous manufacturing is an opportunity for excipient makers, as well. “A different process often needs a different excipient,” says Rina Choski, global leader/regional and field marketing with DowDuPont. The company’s customers are often asking for changes related to continuous manufacturing initiatives. “They need to modify [the compound] for that,” Choski says.

By Vincent Valk

Source: Chemical Week

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