Catalent Q4 results
Catalent to add two 2,000L bioreactors in $34m WI biologics plant expansion
The contract development and manufacturing organisation (CDMO) announced its Q4 fiscal year 2016 figures yesterday, and saw sales in its Drug Delivery Solutions segment of $238m (€213m), up 10% on the same period last year.
The sector includes Catalent’s biologics business, and part of the growth for the quarter was attributed to increased volumes related to its biologics blow-fill-seal offering.
And according to management, biologics services - led by its GPEx cell line platform and its SMARTag bioconjugation technology - are an increasingly important area for the firm, and one Catalent plans to “aggressively” grow organically.
“We continue to believe that our Biologics business is well positioned to drive future growth and comprise an increasing percentage of our overall business,” CFO Matt Walsh told stakeholders yesterday, citing the CDMO’s $600m conjugation deal with Roche earlier this year.
“At the time of the IPO [July 2014], our dedicated Biologics business was approximately 1% of sales and that has since grown to approximately 3% of sales in FY16, so more than doubling the business over approximately three year timeframe.”
As such, the firm said it has begun a $34m expansion at its biomanufacturing facility in Madison, Wisconsin to add two 2,000L single-use bioreactor systems in what CEO John Chiminski said would “help meet customer demand for this fast growing business.
“The new fleet will be capable of running either 2,000L or 4,000L batches to support late-phase clinical and commercial production for our customers using single use bioreactor technology,” he said on the conference call.
“This expansion is an important part of our growth strategy, and builds on previous investments in our biologics capabilities.”
Last year, the firm completed the installation of a 1,000L bioreactor at Madison.
For the fiscal year 2016, Catalent reported net revenues of $1.85bn, up marginally from the year prior, while sales from the firm’s softgel technologies – its largest single product line - fell $13m to $775m.
The sector was blighted by a manufacturing suspension at Catalent’s Beinheim, France facility after out-of-place softgel capsules were discovered in several product batches during quality control procedures last November.
Full production began in May, but the halt and investigation cost the firm approximately $50m in lost revenues, according to Jefferies analyst David Windley who said in a note the CDMO has successfully “battled through short term issues” and the business is showing “signs of improving stability.”