Magazine Article | December 1, 2016

What Are The Key Trends In Global Biopharmaceutical Manufacturing For 2017?

Source: Life Science Leader

By Rob Wright, Chief Editor, Life Science Leader
Follow Me On Twitter @RfwrightLSL

Andrew Skibo
Head Of Global Biologics Operations & Global Engineering, MedImmune/AstraZeneca

Over the years, Life Science Leader magazine has covered key manufacturing trends taking place in the biopharmaceutical industry. For example, we have seen a rise in manufacturing outsourcing, so much so, that we actually created a series of education events to help CMOs and sponsors collaborate more effectively (i.e., OutsourcedPharma Conference And Exhibition). We developed awards programs (e.g., the data-driven CMO and CRO Awards) and publish special supplements to help with the process of selecting an outsourcer, while recognizing the best of the best.

For this article we asked biopharmaceutical manufacturing experts, who also serve on Life Science Leader magazine’s editorial advisory board, what key manufacturing trends we should be paying close attention to in 2017 and beyond. You will find their thoughts interspersed as sidebars throughout this article. This is because we view one of the most important trends (i.e., biomanufacturing capacity, or the lack thereof) as a focal point. But don’t take our word for it. One of the people on the front lines of this topic is Andrew Skibo, head of global biologics operations & global engineering at MedImmune/AstraZeneca. This past May, Skibo chaired a series of presentations at the ISPE Global Pharmaceutical Manufacturers’ Leadership Forum in Frankfurt, Germany, during which he highlighted the significant changes taking place in the biopharmaceutical supply chain. Essentially, Skibo is concerned that industry might not have enough biomanufacturing capacity to support the world’s increasing demand for biologics — despite the unprecedented nearly $20-billion expansion currently in planning or actual development. Since his initial presentation, Skibo has given the same speech at a number of additional venues. In addition to the concern that we might not have enough capacity, there is also the potential, if not properly coordinated, for biopharma to overbuild, and it might soon face a situation similar to that of the oil industry (i.e., overcapacity). Skibo sat down with Life Science Leader to share why he sees biomanufacturing capacity as a key trend that demands your attention.

Bracing For The Biomanufacturing Capacity Crunch

Describe The Manufacturing Capacity Issue As You See It.
The bio industry’s large-scale manufacturing supply is very constrained. While drug product is just beginning to become an issue, drug substance is effectively sold out. About six years ago I was at a manufacturing forum, where many of us seemed to be working in environments with surplus capacity, and there was a lot of financial pressure to consider closing or selling plants. A number of us compared notes, and knowing our pipelines, could see the surplus capacity window closing somewhere in 2017. Because of all the red ink being generated during this surplus manufacturing capacity time period, it was doubtful any board of directors would have approved a biomanufacturing expansion, and why, perhaps, we find ourselves in this current strained-capacity situation.

What Are The Variables Contributing To This Biomanufacturing Capacity Crunch?
There are three:

  • Companies with broad biologic pipelines
  • The rise in biosimilar manufacturing for novel biologics going off-patent
  • Larger than anticipated patient populations for new biologics.

Unlike the 1980s and 1990s where most companies’ futures were determined one product at a time, those active in the biologics space have fairly broad pipelines, which, if successful, will require increased and perhaps diverse means of manufacturing to support.

Though some anticipated biosimilars being a big biomanufacturing capacity sinkhole, this has turned out not to be the case, thus far. That being said, none of us anticipated the impact of some of the new spaces, such as immuno-oncology (IO), which we probably underestimated by at least three times over. So, while biosimilars demanded less than expected, products like the IO mentioned or PCSK9 inhibitors filled in the biomanufacturing capacity gap at a rate much larger than expected. To understand the scale that is rapidly approaching biomanufacturing, imagine if just one Alzheimer’s drug makes it to market. To meet the demand of tens of millions of patients could require a plant seven times the size of AstraZeneca’s 710,000-square-foot (i.e., 16 acres) facility in Frederick, MD (depending on the product and specific indications). In other words, many companies involved in developing biologics are suddenly facing needing two or three additional plants.

Now That We Are Seeing More Biosimilars Gaining FDA Approval, How Might That Further Exacerbate Biomanufacturing Capacity Demand?
It is definitely going to be a factor. Some companies (e.g., Samsung, Boehringer Ingelheim) will really be key when it comes to providing capacity to meet biosimilar demand. By 2020 and onwards, biosimilar manufacturing could represent at least 10 percent of some companies' total global biomanufacturing capacity.

Empirically, What Is The Projected Scope Of This Manufacturing Capacity Crunch?
There is nearly $20 billion worth of large-scale biopharmaceutical site projects currently being planned or already in progress. Some are two- and three-phase exercises. However, $13 billion of these remain in the very early stages of development, meaning we are way behind as an industry. If you add up the bioreactor capacity that will be part of these projects, it’s greater than 1.7 million liters of large-scale, terminal capacity. That doesn’t include any of the small-scale capacity needed for high-titre, smaller demand products.

Anecdotally, How Do You Think Industry Stakeholders Will Experience This Biomanufacturing Capacity Crunch?
Currently, biopharma manufacturing executives are either being pressured to build, which most major firms are pursuing as a partial strategy, or secure guaranteed contracts with major CMOs to ensure biomanufacturing capacity. But these aren’t the typical size CMO contracts. For these major buys of capacity demand, you are seeing biopharmaceutical companies taking a significant part of a new plant that CMOs are building. Two or three years ago, a large European CMO was debating whether or not to build a new 4x15,000-liter plant. Today they are in the process of building a 9x15,000-liter facility. And while this is great and could help, because of the length of time it takes to bring one of these plants online, we won’t see a measurable impact on alleviating capacity demand until somewhere between the years 2021/2022.

Could Companies Seeking To Lock Down CMOs For Guaranteed Capacity End Up Causing Drug Shortages Of Other Products?
Where that risk will occur will be at conservative companies that don’t move quickly enough to implement such contracts. I have never seen such competitiveness in trying to lock down CMO capacity. Just trying to find five lots worth of capacity at the 15,000-liter scale at a CMO, short of the year 2021, is currently a real challenge. Keep in mind that these are costly commitments, and if your timing is wrong by a year, you could be explaining to your CFO why you spent $50 million for a year’s worth of manufacturing capacity you didn’t need.

But, thinking a little more about your previous question, I would like to add that there are several factors exacerbating the possible drug shortage issue. One is with the new approval processes (e.g., breakthrough therapies, accelerated approvals). Another is the rapidity with which science is moving. The old cycle time of six to seven years from concept to approval has shortened to three years, and neither you nor a CMO can build a fully validated and operational large-scale biomanufacturing facility in this shortened time period. In addition, part of your risk management strategy today includes trying to plan for capacity of as of yet unknown products. For example, if your company commits to discovering two Biologic License Applications (BLAs) a year, those responsible for biologic manufacturing capacity have to allow for two BLAs per year that don’t yet exist. That’s a new planning paradigm. Another thing driving manufacturing demand uncertainty is the sheer size of new markets. Even in late-stage development for certain therapy areas (e.g., IO), and I would argue post-launch, the demand band can be 5 times what was anticipated. How do you plan for that? When going before the executive committee to seek project approval, I believe it is as important to seek corporate understanding of the “white space” capacity that you are consciously not planning to build as it is to seek approval for what you are planning to build. And if you get that equation wrong on the low side, because CMOs as previously mentioned are already capacity constrained, you may find yourself (during these lean capacity years) not being able to provide product.

Could We See CMO Price Gouging As A Result Of Such Competitiveness?
That is a small part of the overall pharma equation. While we wouldn’t welcome CMO prices going up by 25 percent, such an increase wouldn’t have a material impact on what we do as an industry. My bigger worry is that most CMOs are developing their own novel pipelines, as well as biosimilars, which have much better margins than traditional outsourcing contracts. And if a CMO's pipeline projects prove successful, they are going to need at least some (if not all) of that capacity. In other words, we could see that using CMOs to try to manage our way through this biomanufacturing capacity crunch becomes even more difficult. Though they will have to honor these contracts, when it comes time to renew in 2022/2023, we may find CMOs much less willing. Further, when you have a product that’s licensed in 80 countries, it’s not easy to move it from one CMO facility to another, assuming another CMO even has available capacity.

What Happens If Companies Get Biomanufacturing Capacity Planning Wrong And Overbuild?
While most of us expect processes to improve by two to three times, we are not building as much capacity as today’s yields require. We assume we will get better by the time these plants go online. There is a real risk to a possible industry overbuild. And though we are all doing our best to risk-adjust while still planning for success, some biopharmas won’t have the successes for which they had hoped — a reality of biopharmaceutical discovery. These unpleasant surprises will arrive somewhere around 2022. Some companies will have a plant come online that won’t be utilized as anticipated. The converse will also be true, as the bands of risk for new biologics with primary care-sized patient populations will have some companies on the low side of being able to supply market demand. Many of us are asking, “Should we, as an industry, really be building this much?” Years ago I remember sitting on what felt like an ocean of manufacturing capacity. Michael Kamarck, Ph.D., my biologics counterpart at Merck, and I were at a forum discussing an industrywide capacity issue. That conversation led to the eventual execution of the Merck-AstraZeneca capacity-sharing agreement known as the Trusted Partner Network (TPN). While this was probably the first time in the industry where two companies actually shared biomanufacturing capacity, it is likely we will see many more similar capacity-sharing initiatives in coming years.

So, What Advice Do You Have For Biopharmaceutical Manufacturing Executives?
I suggest folks be a lot more introspective and less conservative when planning for biomanufacturing capacity demand in the next five years. This will be easier for large firms with broad pipelines, because if some of those biologics don’t hit, they can always lay off some of those risks on other products. For smaller firms with only one or two biologics, this could be much more difficult, especially if some of their pipeline has the potential to be big. All firms will need to watch a spectrum of risk profiles and try to not get overcommitted. But when looking at a take or pay option of a product with a projected market of $2 billion, a $50-million-a-year contract with a CMO might feel expensive if the market doesn’t materialize. On the flip side, imagine walking into the C-suite because there is no other capacity available and trying to explain why you can’t supply that extra $2-billion worth of biomanufacturing capacity. It’s not just the lost revenue and the bottom line. These are specialty care products, and there are patients and human lives tied to that $2 billion in product that can’t be supplied. Such situations are what end up on the front pages of newspapers, and you will have wished you had spent the $50 million and not needed it, than face a scenario of not being able to supply.

How Are You Addressing This Capacity Crunch At Your Organization?
We are investing significantly, both internally and externally. We have expansions at our Frederick, MD, facility ($213 million), which will add significant new small-scale, high-titre capacity. We bought Amgen’s Boulder, CO, drug-substance facility a year ago for $14.6 million, and we will have it commercially online in 2017. We also recently acquired Amgen’s Longmont, CO, campus for $64.5 million, which will not only support the Boulder facility, but provides room if we decide to expand Boulder or build another plant. We are building a new drug product facility in Sweden ($285 million) that will be online by 2018/2019. Finally, we will have engaged our CMOs in long-term contracts that provide additional capacity. In total we have invested about $600 million. As for how we are mitigating the risk, we’ve tried breaking these capacity expansions apart into digestible pieces that can be staged. Telling the CFO that you have no choice but to build a plant twice the size of the Frederick, MD, facility at a cost of $1.2 billion, and that you need to start right away, isn’t very palatable. Splitting demand apart into five and six stepwise pieces allows us to stage adding capacity so we aren’t asking for all the money in just one or two years.

Any Other Advice?
Watch out for nonmammalian-cell platform capacity. Some products aren’t going to fit on mammalian-cell capacity. As such, it becomes even more prudent to quickly figure out where to find that capacity. Microbial, for example, is not a big piece of everybody’s pipeline, so that type of platform capacity is rarer. There are a few products that demand perfusion, which is another rare form of capacity. If you have a nonplatform technology, one thing companies haven’t always been good at doing (until they get bigger) is working with their development colleagues to make sure (in the earliest stages) that they understand what platforms can be easily worked on. If possible, plan for trying to keep this on platform technology, and be instantly aware of those that aren’t platform so you can immediately start planning from where to get supply.

Lastly, if you haven’t already done so, start having some cross-network discussions. These will help build an industrywide biomanufacturing planning picture and provide for sounder judgment while weighing internal-capacity decisions.

What quality manufacturing trend do you anticipate having the biggest impact on the biopharmaceutical industry in 2017?

Jason Urban, Ph.D., Senior Director of Global Quality Operation, Celgene

In quality manufacturing, the biggest impact can be made in areas such as reporting real-time production metrics and developing product analytics platforms. The days of assuring manufacturing quality based on “after-the-fact” measures are over. Today’s pharmaceutical industry environment is ever volatile, with escalating drug shortages, growing regulatory requirements, pricing debates, globalization, and forecasting and planning challenges. Companies will need to recast their quality and manufacturing approaches to stay competitive. It is critical to transform manufacturing thinking to incorporate metrics and predictive analytics in order to drive improvement in manufacturing productivity, flexibility, efficiency, and quality. Being better informed with metrics and predictive analytics can position leaders and managers to better anticipate quality failures over the product life cycle. The potential return on investment through early identification of areas for continuous improvement is where the true impact can be made. Fewer production defects, less unplanned downtime, leveled inventory, and reduced material waste can provide a much higher reinvestment into pipeline development and R&D efforts. Therefore, a quality-centric culture is where it should begin to drive innovation and to gain the edge in a competitive landscape.

What manufacturing trend do you anticipate having the biggest impact on the biopharmaceutical industry in 2017 and beyond?

Sandra Poole, EVP of Technical Operations, ImmunoGen; Former SVP of Biologics Manufacturing, Genzyme

We are living in a world of rapid change, increased interconnectivity, complexity, and uncertainty. The forces of change and pressures on our technical and manufacturing operations are enormous — from pricing pressures and increased competition to technological, regulatory, and social changes. These trends are forcing an accelerating evolution in our manufacturing operations. The introduction of new technologies is changing plant designs, plant support systems, and even work practices. Global supply chains are becoming increasingly more complex as we seek to manage therapeutics produced in new biologic platforms while ensuring their global delivery into highly variable local conditions. Add to this the shifting workforce demographics that are challenging leaders to manage different values and expectations of a multigenerational workplace.

Unfortunately, today’s manufacturing leaders lack the essential leadership skills to effectively manage in this undulating landscape. If this isn’t bad enough, the methods we have been using to develop our leaders (i.e., static one-directional, lecture-style delivery of best practices based on past experience) have not kept pace. Further, most leadership development programs, with the standardized one-size-fits-all curricula, are not designed to cultivate the key leadership attributes/ capabilities necessary for the future — adaptability, self-awareness, and innovative critical thinking.

However, exciting advances are being made and new approaches being introduced which are beginning to address the leadership gaps. One example is the use of action learning methodologies where leaders immediately apply and integrate their newly learned skills to their “real work.” Other examples include developing deeper self-awareness through coaching and making time to learn from mistakes. These types of leadership development opportunities are daily and ongoing. How are today’s leaders learning from the successes, challenges, and setbacks their team, plant, or network experiences? What adjustments are they making as a consequence of these new learnings? Do they have the ability to critically assess the outcome of that adjustment and then lead their team or organization through the institutionalization of the learning? These are the questions we should be asking and the trend we should first be seeking to address. For all the “cool” trends of continuous manufacturing and other shiny tools won’t mean much if we (i.e., manufacturing leaders) don’t have the essential skills to lead in today’s world.

What Is Necessary To Realize The Promise Of Advanced Therapy Medicinal Products

Thomas Kreil, Ph.D., Senior Director of Global Pathogen Safety, Shire

When Life Science Leader posed the question, “What might have the biggest impact on the biopharmaceutical industry in 2017?” to editorial advisory board member Charlene Banard, SVP of global quality and technical operations at Shire, rather than fire back her opinion, she sought the counsel of others throughout her organization. “Unsurprising, a variety of trends cropped up,” Banard stated. “Responses ranged from device software applications and other regulated product supplements to continuous manufacturing and deployment of the FDA’s quality metrics program. But our industry’s proclivity for innovation and sometimes forgotten lessons of the past led me to share the thoughts of my colleague, Thomas Kreil, Ph.D., the head of Shire’s pathogen safety organization.”

Advanced therapy medicinal products (ATMP), such as gene therapy, somatic cell therapy, and tissue engineering, hold the promise of making treatment available for as yet unmet medical needs. Technological progress during recent years has been rapid, and regulators in the U.S. and elsewhere are establishing or refining procedures to escort these products to market. Yet in some ways, ATMPs are quite normal biological medicinal products, fraught with some of the same issues that history has witnessed for plasma derivatives, and later recombinant proteins: the exposure to universally present and uniquely effective opportunistic agents (i.e., the microbiological environment).

To ensure the innovative power intrinsic to ATMPs does not get stigmatized by earlier-faced complications, the development community is well-advised making use of the most advanced technological approaches to safeguard them from exposure to pathogens. For an unfortunate reminder of realities, the manufacturing platform of a licensed ATMP has already been found to be contaminated with a virus, fortunately this time not pathogenic to humans. Technologies that may be applied to safeguard ATMPs include, for example, next-generation sequencing for the characterization of innovative cell substrates, microbial barriers for microorganisms now effective against even viruses in the upstream rather than traditionally in the downstream process, and consequently closed or functionally closed downstream manufacturing processes to minimize any exposure to operators and the environment. Altogether, ATMPs may bring about a bright future, with treatment possible for many still-orphan conditions; if only we do not forget the learnings from the past.

What biologics manufacturing trend do you anticipate having the biggest impact on the biopharmaceutical industry in 2017 and beyond?

Mark A. Petrich, Ph.D., PE, Director, Single-Use Systems Engineering, Merck; Second Vice Chair, Bio-Process Systems Alliance

I am anticipating we will see increased standardization of single-use systems (SUS) and how we manage them. Standardization has the potential to reduce costs, shorten lead times, and improve quality. Rather than focusing efforts on process and product development, engineers are currently engaged in customization of SUS, management of orders, and other off-target tasks. It is typical for biopharmaceutical manufacturers to individually expend resources tackling challenges related to design, qualification, and testing of SUS. These challenges are common, and many of them are not points of competition. Joint efforts to develop standard processing platforms, standard modules for fluid management activities, standard test methods for systems qualification, and standards for communication should be pursued by industry groups made up of both suppliers and SUS users. Efforts such as the collaborations between BPOG (BioPhorum Operations Group) and BPSA (Bio-Process Systems Alliance) to develop user requirements, specification templates, and changenotification standards are a great start. An emphasis on standard systems with standard quality expectations will allow suppliers to optimize manufacturing methods and biopharmaceutical manufacturers to focus on process development and optimization. This will lead to improved quality and reliability of SUS and the processes and patients that depend on them.