Catalent: Cook deal strengthens sub 5,000L scale CMO strategy

By Dan Stanton contact

- Last updated on GMT

Catalent says 70% of biologics will require under 5 (thousand) litre scale. GettyImages/trekandshoot
Catalent says 70% of biologics will require under 5 (thousand) litre scale. GettyImages/trekandshoot
70% of the biologics pipeline will require less than 5,000L of commercial manufacturing capacity says Catalent, fresh from its acquisition of Cook.

Late last month, contract development and manufacturing organisation (CDMO) Catalent completed the $950m (€822m) acquisition of Cook​, adding an 875,000sq ft facility in Bloomington, Indiana to its biologics business.

According to Mike Riley, general manager of biologics at Catalent, the deal signifies Catalent’s growth ambition in the biomanufacturing space.

He told Biopharma-Reporter days after the acquisition closed Cook adds additional cell culture manufacturing, as well as extensive drug product capabilities, including fill and finish.

He added the Bloomington plant with its 2,500L scale plays into Catalent’s strategy to stay within the sub 5,000L market.

“We see a significant pipeline of products that require under 5,000L, and there is significant growth potential for flexible manufacturing at this scale,”​ he told us at the recent CPhI Worldwide show in Frankfurt. “This has guided our investments.”

Catalent’s Madison, Wisconsin facility has undergone a number of expansions, the latest being a $34m investment adding two 2,000L single-use bioreactor systems last November.

And while Riley said there is growth potential in larger-scale (stainless steel) contract biomanufacturing – Samsung Biologics just had a 152,000L plant approved by the US FDA​, for example – he said this is not an area Catalent is looking to enter.

‘Spending in the tens of millions of dollars versus the hundreds of millions’

Catalent CEO John Chiminski mirrored Riley’s views during a conference call Monday to discuss financial results.

“Our thinking has not changed in terms of scale​,” he said. “The biologic supply space is really bar-belled between the very big suppliers, where they'll still have opportunities, I would say, on potential biosimilars that come to market and a few blockbusters in the biologics area.”

He named Lonza, Boehringer-Ingelheim and WuXi – which is close to opening a 28,000L single-use site in Wuxi City, China – among this group.

However, he continued, “from the analysis that we've done with our Strategic Advisory Board, our own experts and outside consultancy that 70% of what's currently in the pipeline is going to require 5,000L or less.

“We really like that space. It has aggressive growth for us. It allows us to be reasonable in terms of the CapEx requirements. We're spending in the tens of millions of dollars versus the hundreds of millions of dollars for big capacity. And it allows us to use that single use bioreactor technology, which really improves cycle times and the potential for contamination and so forth.”

Financials

For the first quarter of fiscal year 2018, Catalent reported total revenues of $543m, up 23% year-on-year. The Drug Delivery Solutions segment, which includes biologics, was up 18% y-o-y to $225m.

CFO Matthew Walsh added on the call biologics represented around 14% of Catalent’s overall revenue for FY2017, but the addition of Cool is expected to increase biologics percentage to 21% of the combined entity's pro forma revenue.

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