Taking the temperature of pharmaceutical services at CPhI

The organizers of CPhI, the pharmaceutical service trade exposition that takes place in Europe each fall, recast the event this year as an online conference with the theme Festival of Pharma. The event is known for exhibition spaces packed with thousands of attendees from around the world. But with cases of COVID-19 resurging, participants stayed home for video sessions with topics ranging from vaccine development challenges to wellbeing through better sleep.

Supply chain insecurity was a recurring theme, one that has long concerned contract development and manufacturing organizations (CDMOs) and this year woke up regulators in the US and Europe. Several countries are now acting to “reshore” essential active pharmaceutical ingredients (APIs) that have been outsourced to China and elsewhere over the past 20 years.

The US government, the most active, has funded public/private partnerships including Phlow, which received $354 million upon its launch in May with a mandate to reshore generic drugs. The US also offered Eastman Kodak a $765 million loan to convert facilities at its headquarters in Rochester, New York, to make generic APIs.

Individual countries in Europe are eying similar programs, notably France, where the government is working with the CDMO Seqens and the drug maker Sanofi on a project to establish production of bulk acetaminophen within three years.

Martin Van Trieste, CEO of Civica Rx, a non-profit formed to ensure healthcare institutions access to essential drugs, noted that shortages are a global problem. “Even India has shortages when they depend on things coming from China,” said Van Trieste, who spoke on a panel about the impact of globalization on drug shortages. He noted that Mexico recently struck a deal with Indian generics makers to establish a production hub in Mexico.

The drug shortage list shifts frequently, Van Trieste warned, pointing to a list published by the American Academy of Health System Pharmacists. Early this year the pandemic produced a 300% surge in demand for palliatives such as narcotics, neuromuscular blockers, sedation agents, and antibiotics. With a few COVID-19 treatments since approved, the months ahead could bring a scramble for drugs that treat COVID-19 such as remdesivir, steroids, and neutralizing antibodies.

“The next wave will have a whole different set of drugs” in shortage, Van Trieste said, invoking the Canadian hockey great Wayne Gretsky. “It’s important to not chase the puck but to be where the puck is going to go.”

Another session focused on transformative developments underway prior to the pandemic that will continue to impact the pharma service market. Participants in a panel on CDMO trends agreed that mergers and acquisitions show no sign of slowing down.

Major drug companies will continue to sell manufacturing sites to CDMOs, the panelists said, and the one-stop-shop model of combining API production with finished-dose drug manufacturing is now well established. One result, noted Jim Miller, a consultant and founder of the journal PharmSource, is a split between “high- and low-end” CDMOs. A handful of large, comprehensive service firms such as Lonza, Thermo Fisher Scientific, and Catalent, he said, have become the “go-to provider for when a company has a molecule they want to bring to market, a new molecular entity in particular.”

Still, plenty of work will remain for specialist CDMOs, Miller and other panelists affirmed. Enthusiasm over the 2020 chemistry Nobel Prize for the developers of CRISPR gene-editing technology, announced during the first week of the two-week event, highlights growing interest in cell and gene therapies in the CDMO sector.

“The number of clinical trials underway in cell and gene therapy and the kind of work being done on messenger RNA and gene editing are just phenomenal,” said Peter Bigelow, president of xCell Strategic Consulting and a former executive at Patheon, a drug service firm that is now part of Thermo Fisher. “It reminds me of biotech 30 years ago. We knew it would explode, we just didn’t know how fast.”

Miller pointed out that two large service firms took notice of the gene therapy boom in 2019—Thermo Fisher with its acquisition of Brammer Bio and Catalent with the purchase of Paragon Bioservices.

Panelists agreed that the pandemic will influence everything in the CDMO sector. “There is definitely a COVID-19-driven disruption going on right now,” Bigelow said. Governments and private companies are reserving capacity for vaccine production, exacerbating a shortage of injectable drug capacity. And the emergence of public/private partnerships such as Phlow is accelerating a reordering of supply chains to accommodate regional production requirements.

“These are megatrends that won’t go away with a vaccine,” Bigelow said.