“We now expect, particularly in the light of the need to produce vaccine booster shots and address the growth in variant forms, that this revenue will have a multi-year duration,” said Thomas Castellano, senior vice president and CFO, Catalent, on a conference call yesterday with analysts, following the release of the CDMO’s fourth quarter 2021 financial results.
The biologics segment was again the top contributor to Catalent's financial performance with organic revenue growth of 66% and segment EBITDA more than doubling from the fourth quarter of last year.
The robust organic growth in the biologics segment in the quarter was driven by high demand for drug product, drug substance and viral vector manufacturing along with bioanalytical services, said Castellano. “The increase was primarily driven by COVID-19 related projects.”
In fiscal 2022, Catalent expects the biologics division to continue to grow net revenue at a double-digit pace.
Single doses or lower volume formats in the COVID-19 vaccine space will also support the CDMO's growth, analysts on that call were told.
"We're also seeing a change in formats... fewer doses per vial. We're seeing a push toward pre-filled syringes... leading to increasing volumes for Catalent," said John Chiminski, chair and CEO, Catalent, on the call.
He said its Anagni facility in Italy has been a marquee site for European COVID-19 vaccine efforts. “The team has really delivered flawlessly, literally more than 100 million vaccine doses have come out of there.”
Catalent, he added, has now inserted itself into the vaccine category “in a really substantial way.”
“And, quite frankly, the strong brand reputation of being able to deliver in this crazy tumultuous time... has elevated our status as a CDMO in the vaccine category,” continued the CEO.
He stressed that mRNA is not just going to be a COVID-19 vaccine therapeutic platform, and that he expects Moderna and others to harness Catalent’s expertise for mRNA technology beyond COVID.
Weighing in on that, Castellano said the company sees innovative vaccines, particularly the newer gene based vaccines as a long-term strategic product area for Catalent “given the substantial partnerships we have built in this space due to pandemic.”
Securing additional assets
Catalent has been investing in its Anagni facility from a drug product and a drug substance standpoint, establishing its first drug substance capacity outside of the US to support the growing European market demand for biologics manufacture and supply.
And the CEO said the company is now looking to secure additional drug substance and drug product assets in Europe.
Meanwhile, dynamics in the gene and cell therapy space continue to be extremely robust, said Chiminski.
“Over the last two years, we've added critical pieces to our portfolio, in the cell therapy space giving additional manufacturing facilities and capacity, we entered into the plasmid DNA space, and now, obviously, with the acquisition of RheinCell, we have our hands on a kind of iPSC cell bank. So, we really think that we have a strong portfolio.”
The company, he said, has a strong footprint for cell therapy across its Gosselies Belgium campus now and also in Houston, Texas. “And we have a huge capability in viral vector manufacturing in the Baltimore area. But if we were able to get our hands on the right asset from a viral vector manufacturing standpoint in Europe, that would also be a priority for us,” added Chiminski.
Catalent also announced yesterday that it is to acquire Bettera Holdings, LLC, a leading manufacturer in the high-growth gummy, soft chew, and lozenge segments of the nutritional supplements market.