Stability Sought In Fine Chemicals | October 31, 2011 Issue - Vol. 89 Issue 44 | Chemical & Engineering News
Volume 89 Issue 44 | p. 8 | News of The Week
Issue Date: October 31, 2011

Stability Sought In Fine Chemicals

CPhI: Suppliers hope pharmaceutical chemicals business will find level ground
Department: Business
Keywords: CPhI, fine chemicals, pharmaceuticals, custom manufacturing
Frankfurt attendees looked high and low for opportunities.
Credit: Ann Thayer/C&EN
Conferees riding down an escalator at the 2011 CPhI pharmaceutical ingredients conference in Frankfurt, Germany.
Frankfurt attendees looked high and low for opportunities.
Credit: Ann Thayer/C&EN

Fine and custom chemicals suppliers searched for new business at CPhI, the annual pharmaceutical ingredients conference, which took place in Frankfurt, Germany, last week. Although attendance was up and conference traffic was brisk, executives were only guardedly optimistic that business is returning. Customers, many said, are being careful about how, when, and where they spend any of the limited investment dollars that are back in play.

Saltigo CEO Wolfgang Schmitz is among the more bullish custom chemical executives, telling C&EN that the pharmaceutical market is strong this year. Success has hinged on “an improved pipeline and interesting molecules,” he said. Schmitz and other executives remarked that the market for agricultural chemicals, which softened considerably in 2010, also improved in 2011.

As the conference took place, European government leaders were scrambling to avoid imminent financial disaster over the Greek debt crisis. Given the period of prolonged economic instability, Schmitz sees increased concern on the part of customers about the financial strength of their suppliers. “I am amazed at how many conversations have started with the question of financial stability,” he said.

Another signal of concern for the European economy is a relative lack of inquiries for projects on the Continent, according to David Ager, principal scientist with DSM Pharma Chemicals. “A lot of our inquiries are in the U.S.,” he said, with a distinct increase in investment in early-stage projects.

“Everybody is in trouble and claiming they are in good shape,” said Peter Pollak, an industry consultant who once ran Lonza’s fine chemicals business. East-West rivalries for business persist, and Pollak contests claims by Western producers that they can provide contract manufacturing services at the same cost as Indian and Chinese firms. Although quality remains a concern in Asia, some European and U.S. companies have quality issues as well, he said.

“It’s a tough world out there,” pointed out Mark C. Griffiths, CEO of Carbogen Amcis, which combines early-phase development capabilities in Switzerland with large-scale capacity in India for highly potent compounds. Interesting discussions are under way again with customers, he said, “but they are very ­cautious, which means you just have to be patient.”

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