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Outsourcing

Hovione bulks up, with a twist

A pharmaceutical services pioneer cues up continuous tableting as it doubles manufacturing

by Rick Mullin
November 12, 2018 | APPEARED IN VOLUME 96, ISSUE 45

 

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Credit: Hovione
Hovione CEO Guy Villax at the company’s new Lisbon research center, where he wants to keep researchers focused on the big picture in drug development.

Guy Villax, CEO of Hovione, stands in the central hall of the company’s new R&D center in Lisbon. On the wall beside him is a mural with photographs commemorating the family-owned pharmaceutical chemistry firm’s milestones since it was founded by his parents, Ivan and Diane Villax, 59 years ago. There is also a nearly floor-to-ceiling portrait of Steve Jobs, the cofounder of Apple.

Hovione at a glance

Revenue: $274 million in 2017, with a goal of $300 million for 2018

Active projects: 167

Products: Generic APIs

Services: API manufacturing, particle engineering, formulation services, spray drying, drug-product manufacturing, continuous tableting, product licensing, inhalation drug development

Employees: 1,600

Manufacturing sites: Loures, Portugal; Macau, China; East Windsor, N.J.; Cork, Ireland

Manufacturing capacity: 596 m3

Guy Villax is fond of extolling innovation and inspirational figures such as Jobs and Charles Darwin, who on another mural is quoted regarding species’ responsiveness to change. That mural also nods to an evolution in how Hovione regards the scientists who work in R&D.

His father, he explains, was a man of his times. “He didn’t give much space to empowerment and all that,” he says. Villax, on the other hand, has been giving employee empowerment a lot of space recently.

The 7,000-m2 R&D center was designed with low-walled cubicles and picture windows looking into labs and conference rooms. A large tote board on the second floor lists the company’s patents, with a good number of entries—failed applications—crossed out with red lines. Banners from the ceiling celebrate the launch of new drugs for which Hovione supplied active pharmaceutical ingredients (APIs) and other services. There were four in 2017, close to 10% of the 46 drugs approved by the U.S. Food & Drug Administration.

Villax says he wants to get chemists to look up from the bench at the big picture. “It feels a little less inhuman, not doing the Charlie Chaplin things,” he says, referring to Chaplin’s skewering of the machine age in the film “Modern Times.” “If you give people a sense of what it’s all about and how they contribute, they fill in their batch records with greater care. But to keep people excited about doing new things, you have to give them the right tools.”

R&D at headquarters is one thing. Manufacturing on three continents is another, for a family-owned firm with plans to double capacity at most of its sites. But Villax sees a continuum from the lab to the plant in which developments in both realms are guided by innovative science and customer demand. It’s a philosophy that has kept Hovione afloat as many other firms in the drug service industry get swallowed up by financial buyers or big corporations.

Indeed, Hovione has been adding tools beyond the lab, including at its plant in nearby Loures, where it is doubling manufacturing capacity and starting up a finished-dosage drug plant it acquired in 2015 and then retooled.

Meanwhile, the company is adding a second pilot plant at its smaller-scale facility in East Windsor, N.J., and commissioning the second of two manufacturing buildings at a large-scale facility in Cork, Ireland, capacity that has been mothballed since Hovione bought the site from Pfizer in 2009.

The company has also added a wholly new tool in New Jersey—a continuous tableting plant­—for which it has a contract to work with Vertex Pharmaceuticals. Hovione will offer the service for other customers there and in Lisbon, where a similar plant is scheduled to be installed.

Hovione invested about $100 million in 2017 and plans to spend as much again this year and next. The plan over the next three years is to continue investing, especially in Portugal, where the firm will add 165 m3 of chemical synthesis capacity, a spray-dryer building, and a 1,200-m2 analytical lab.

Hovione’s capacity expansion is ambitious but somewhat conventional for a firm whose major investments have historically startled industry watchers. In 1985, for example, Hovione built a plant in Macau, the first instance of a European drug service company investing in China. In 2002, it opened the New Jersey plant, starting a trend of European firms establishing small-scale beachheads in the U.S.

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Credit: Hovione
A technician at Hovione’s New Jersey facility prepares a spray-drying unit before a manufacturing run.

Then came the Cork acquisition, which, in addition to bulking up manufacturing capacity with a plant Pfizer no longer needed, brought a huge spray-drying facility. Hovione pioneered and remains a leader among firms offering this now-popular service.

If anything, the move into tableting is a bit of catch-up for Villax, who not long ago spoke skeptically of peers adding final-dosage service to chemistry. The merger of DSM’s pharmaceutical chemical business with Patheon’s finished-drug service was a seeming vindication of this one-stop-shop approach. Several other firms, including Siegfried, Carbogen Amcis, and Aesica, also invested in dosage-form manufacturing, as Hovione held fast with chemistry alone.

Villax finally blinked in 2015, purchasing a plant literally over the fence from Hovione’s main site in Loures. Villax insists he would never have added dosage services if the plant weren’t adjacent to API manufacturing. He says the company now has two customers for which it does particle engineering, API synthesis, and final product manufacturing at the one site.

He emphasizes that Hovione had signed up Vertex for continuous tableting before committing to the cutting-edge technology in New Jersey. Dosage-form service “is not a leap or change in direction,” he insists. “Who do you think showed us the way? The clients.”

In New Jersey, site general manager Filipe Tomás is focused on increasing capacity for clients in the early stages of drug development. “This site cannot be at maximum capacity,” he says. “We expect to be at 60% to 70% occupancy and always be a door to customers when they have a lead.”

And that door is about to open on continuous tableting, which is beginning registration runs and is set to go into commercial production next year. Hovione’s hope that the service will be of interest is borne out several miles away at the Rutgers University Engineering Research Center for Structured Organic Particulate Systems. There, engineers have worked with Vertex and Janssen Pharmaceuticals, firms that Douglas Hausner, associate director of industrial liaison at the center, describes as early adopters. Hovione hired several students and engineers from the center as it secured the contract with Vertex.

Tomás sees the addition of tableting as a natural progression in pharmaceutical services rather than a break from Hovione’s chemistry tradition. The new apparatus, a three-story rig with a belt of tablet troughs running from top to bottom, is utterly unlike the pilot reactors elsewhere in the facility. “This is a technology that we think adds value,” specifically that of speed to market, Tomás says.

He points to a newly constructed space near the tableting machinery in which the company may add blister packaging, a service Vertex is not currently signed on for. The site has also doubled its research space with the creation of an open environment that mirrors the new Lisbon center. Along with a significant increase in staff, the New Jersey labs have increased technical firepower in areas such as particle design and engineering.

Back in Lisbon, Cláudia Ferreira, general manager of R&D services, says research and technology have seen many changes in recent years but have still followed one basic course. “Hovione always takes advantage of its core way of working, which is science driven and innovation driven. That hasn’t changed.”

Rafael Antunes, senior director of R&D, adds that remaining a family-owned company allows Hovione to take risks and make long-term investments, including in its research endeavors. “We like to be challenged,” he says. “We feel we have to differentiate ourselves from the competition, to set the bar high on the technologies we adopt, and to have the right people.”

Hovione employs about 90 Ph.D. scientists. Under a program launched five years ago, 11 Ph.D. students are doing research at the firm. The four who have completed their program have been hired by the company.

“What you have in our industry, as in so many others, is an expansion of knowledge and technology,” Villax says. “You have to keep up, and you have to solve problems faster.”

James Bruno, president of the consulting firm Chemical & Pharmaceutical Solutions, says that Villax makes some risky moves but that they tend to pay off, with the latest venture in continuous tableting appearing to be another good one.

“Sometimes I’ve scratched my head and said, ‘What is he thinking?’ ” Bruno says. “But five years later, you got to go back and say, ‘Well, you know, that was a pretty good idea.’ I think Guy always has a tendency to be a step ahead of everybody else in general. He’s doing things that people are thinking about doing.”

Villax says he’s often challenged on the question of whether, despite a good run, a major disruption in pharmaceutical technology might “get Hovione bankrupt.” This, he admits, is a good question.

But he also points to an uninterrupted line in pharmacology development that has yet to be disrupted by genomics, digital technologies, and other game-changing leaps in science.

“I think the pharmacy is something relatively unchanged for 30,000 or 40,000 years. Even when you had hunters and gatherers, I’m sure there were some people who knew what certain plants did for you. So I can’t see what is really going to disrupt us,” he says, smiling. “Famous last words!”

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