Novartis to keep complex biologics manufacturing in-house

By Dan Stanton

- Last updated on GMT

Novartis will continue to outsource the 'easy side' of manufacturing but complex biologics stay in-house
Novartis will continue to outsource the 'easy side' of manufacturing but complex biologics stay in-house

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Novartis says it will keep biomanufacturing in-house and outsource more production of its small molecule portfolio in a strategy mirroring its Big Pharma peers.

Company head of global tech operations, Juan Andres, outlined the plan at the FT Global Healthcare and Biotech Conference in London, UK, this week during a panel debate on biologics and personalised meds.

“The goal of manufacturing historically has been to convert this technology into the certainty of supply… and as such companies have not evolved traditionally a lot of manufacturing technology,”​ he said. “A lot have been using the same type of chemistry the same type of formulation for decades.”

However, he continued, with biologic pipelines increasing across the industry – Bristol-Myers Squibb recently said​ 75% of its portfolio will be biologics by 2019 – companies are moving very fast towards finding flexible ways of manufacturing such drugs.

And, although larger contract manufacturing organisations (CMOs) have invested in biomanufacturing capacity, Novartis will only outsource the “easy side”​ of manufacturing (small molecules, generics, OTCs etc.) according to Andres, who added that difficult manufacturing will remain in-house.

Difficulty in manufacturing biologics, means “those things are going to be more problematic to outsource and will require more flexibility,” ​he added.

Novartis is currently building a $500m (€400m) cell-culture based manufacturing facility​ in Singapore, and has recently invested in new stem cell production platforms​ and gene-editing technologies​.

Big Pharma Trend?

Andres’ views countered those of Heiner Hoppmann – CEO of the third largest CMO, Aenova – who predicted levels of outsourcing across the industry to go from approximately 35% to 80% over the next two decades​, but mirrored the strategy of several other Big Pharma firms.

When this publication visited Ireland earlier this year, Eli Lilly told us​ it was looking to keep greater control of its complex manufacturing processes, committing €330m ($410m) to a commercial scale biologics facility at its site in Kinsale, Cork.

Similarly, J&J’s Janssen said it was more likely to invest in its own capabilities for biologics and more complex production techniques.

The company still relies on “significant amounts of outsourcing of manufacturing for small molecules,”​ but capital expenditure is more likely to be put into “high value more complex technology pieces, rather than taking something that’s being produced using certain technologies that’s been there for years,” Kyran Johnson, General Manager of Supply Chain at Janssen Ireland, told us​.

Last week an industry report from PharmaSource found it unlikely Biopharma would dramatically increase its levels of outsourcing but agreed “the kind of things where they’re likely to outsource are projects with older tech – small molecule API or solid dose,”​ rather than complex manufacturing.

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