Big Pharma’s Manufacturing InvestmentsBy
What were some of the key capital investments in manufacturing by the pharmaceutical majors globally in 2020 and 2021 to date? Biomanufacturing for both traditional biologics and new modalities, such as cell and gene therapies, continues to be an active area of investment with targeted investments in other manufacturing segments
A roundup of manufacturing investments
Companies providing COVID-19 vaccines and treatments have ramped up production, but what about outside of this area and in other drug areas. Below are some highlights of manufacturing announcements from the larger pharmaceutical companies made in 2020 and 2021 to date.
Pfizer. In November (November 2020), Pfizer announced it will make a EUR 300-million ($351-million) capital investment in its Irish operations to support the further development of its existing manufacturing sites in Grange Castle, Newbridge, and Ringaskiddy. The investment will provide additional manufacturing and laboratory capacity and create approximately 300 positions. The investment and roles being created will upgrade and enhance existing facilities, expand manufacturing and laboratory capacity, and add new technologies. The investment and additional roles will be completed over the next two to three years (as reported on November 2, 2020). Part of the investment includes a project to construct a development facility on the existing Ringaskiddy site to manufacture pharmaceutical compounds for Pfizer’s clinical trials globally.
As of December 31, 2020, Pfizer Global Supply had responsibility for 43 plants globally, including in Belgium, Germany, India, Ireland, Italy, Japan, Singapore and the US, which manufacture products for Pfizer. Pfizer expects to exit five of these sites over the next several years.
Bristol-Myers Squibb. In February (February 2021), Bristol-Myers Squibb (BMS) announced that construction is underway for a new cell-therapy manufacturing facility at its biomanufacturing site in Devens, Massachusetts. The new cell-therapy facility will be located on BMS’s current 89-acre Devens campus that supports process development, clinical manufacturing and commercial manufacturing for biologics medicines. The new 244,000-square-foot facility, which will have clinical and commercial-scale capacity, will add to the company’s cell-therapy manufacturing network, which includes facilities in Bothell, Washington, Summit, New Jersey, and Warren, New Jersey as well as external manufacturing facilities in the US, Europe, and Japan. BMS also operates two R&D facilities in Cambridge, Massachusetts and will be bringing those two sites together into a new building in 2023.
In addition to its biomanufacturing campus in Devens, BMS has a large-scale biologics manufacturing facility in Cruiserath, Ireland. The company received regulatory approval for the new facility from the US Food and Drug Administration in December 2019 and from EU regulatory authorities in January 2020. Overall, the company’s biologics, cell therapy and pharmaceutical manufacturing facilities are located in the US, Puerto Rico, Ireland and Switzerland.
Novartis. In 2020, Novartis established five integrated manufacturing and supply platforms: large molecules, small molecules, Sandoz Technical Operations (Novartis’ generic and buiosimilars business), cell and gene therapy, and local market manufacturing. Novartis Technical Operations (NTO) manages the production, supply chains and quality of the company’s Innovative Medicines and Sandoz Division products through a network of 54 manufacturing sites, as well as through external suppliers, and warehouse and distribution centers. NTO is adapting the company’s manufacturing capacity and capabilities to meet changing needs, shifting from high-volume products toward lower-volume, customized and personalized medicines. As of December 31, 2020, Novartis had closed, exited or sold 18 manufacturing sites since 2016 and announced the closure, exit, or sale of seven additional manufacturing sites. The company continued in 2020 to expand its capacity in personalized medicines and complex biologic drugs, such as at its site in Stein, Switzerland, as well as investing in new facilities to provide cell and gene therapies, such as in its site in Les Ulis, France.
In 2020, Advanced Accelerator Applications (AAA), a Novartis company, executed a sales and purchase agreement for a 50,000-square-foot piece of land in Indianapolis, Indiana to build a radioligand therapy manufacturing plant. Novartis acquired AAA, a Saint-Genis-Pouilly, France-headquartered radiopharmaceutical company, for $3.9-billion in 2018. The facility will expand AAA’s manufacturing capacity in the US. Completion of the plant and initial operations are scheduled for 2023. The plant will be AAA’s second manufacturing facility in the US.
Sanofi. A key manufacturing move by Sanofi was the formation of a new standalone company, based in France, EUROAPI, dedicated to the development, production and marketing of active pharmaceutical ingredients (APIs). Sanofi announced the formation of the standalone company in February 2020. The new company will provide “made in Europe” API industrial services and technologies. The new company combines Sanofi’s API commercial and development activities with six of its European production sites: Brindisi, Italy; Frankfurt, Germany; Haverhill, UK; St. Aubin les Elbeuf, France; Vertolaye, France; and Újpest, Hungary. Sanofi will support the new company by establishing a long-term customer relationship with EUROAPI and holding a minority stake of approximately 30% in it.
Sanofi says it expects the new manufacturing company to bring in EUR 1 billion ($1.1 billion) in sales by 2022 and that the standalone company will rank number one in small-molecule APIs and number two in the global API market. The new company will have a portfolio of 200 APIs. Sanofi says that the new European company will help balance “the industry’s heavy reliance on API sourced from other regions.” The company will employ 3,200 employees and be headquartered in France. A planned initial public offering on Euronext Paris would be evaluated with a decision expected by 2022, subject to market conditions.
In 2020, Sanofi announced plans to invest EUR 610 million ($685 million) to create a new production site and research center for vaccines in France, including to allow it to respond to future pandemic risks. Sanofi plans to invest EUR 490 million ($550 million) over a five-year period in vaccine production in France through the creation of what it calls an “Evolutive Vaccine Facility” (EVF) in Neuville sur Saône. The EVF is designed around a central unit housing several fully digital production modules to produce three to four vaccines simultaneously; the modularity allows for production to be prioritized for a specific vaccine based on public health issues. In addition, Sanofi committed to investing EUR 120 million ($135 million) to create a new R&D center in France at the Sanofi Pasteur site in Marcy-l’Etoile to develop future vaccines.
Merck & Co. Earlier this month (March 2021), the US government announced that it will collaborate with Merck & Co. to repurpose some existing Merck facilities for rapid large-scale manufacturing of vaccines and therapeutics for use in public health emergencies, including the current pandemic. The facilities will be available to private sector partners working with the US federal government on the COVID-19 response or to produce Merck products against COVID-19. J&J’s Janssen Pharmaceuticals will be the first federal partner to use repurposed Merck facilities to manufacture a COVID-19 vaccine. The US government will provide up to $268.8 million in funding to Merck, with an initial investment of $105 million, to adapt and make available a number of existing manufacturing facilities for the production of SARS-CoV-2/COVID-19 vaccines and medicines. This funding is in addition to Merck’s continued investment in its global vaccines manufacturing network as part of its planned overall capital investments of more than $20 billion from 2020 through the end of 2024.
Overall, Merck has production facilities for human health products at nine locations in the US, including Puerto Rico. Outside the US, through subsidiaries, the company owns or has an interest in manufacturing plants or other properties in Japan, Singapore, South Africa, and other countries in Western Europe, Central and South America, and Asia. A number of properties will be transferred to Organon, the name of the pending spin-off company formed from Merck’s women’s health, legacy products, and biosimilars businesses. Its capital expenditures in 2020 were $4.7 billion and focused primarily on increasing manufacturing capacity for Merck’s key products. The increased capital expenditures in 2020 also reflect the purchase from Takeda of a biologics manufacturing facility in Dunboyne, Ireland to support upcoming products.
AstraZeneca. In 2020, AstraZeneca announced that it is investing more than $500 million over five years in France in several manufacturing and R&D projects, including a $230-million investment to expand its manufacturing site in Dunkirk, France. The Dunkirk facility is dedicated to the development, manufacturing and supply of aerosol products. Nearly 100% (99.9%) of products made at the site are exported. The $230-million investment through 2025 is for an autonomous assembly line, two assembly and packaging lines, and modernization of existing equipment and infrastructure.
Also announced in 2020, AstraZeneca bought back its packaging and distribution center for oral solid dose drug products in Reims, France, which it had sold in 2017 to Avara Pharmaceutical Services. The facility will continue to package and distribute drugs from AstraZeneca for the French and international markets. In 2019, the Reims site packaged 25 million boxes of medication through seven automated lines. It also distributed 22 million boxes of medicines in France and 19 million internationally. The company also plans to invest $275 million for R&D in France and will further invest in a European Innovation hub in Paris.
In Australia, in 2020, AstraZeneca announced it is investing $200 million in its manufacturing facility in North Ryde, Sydney, Australia to increase the facility’s production capabilities for respiratory medicines to treat asthma and chronic obstructive pulmonary disease. The investment follows a $100-million investment announced in 2017.
AstraZeneca’s principal tablet and capsule formulation sites are in the UK, Sweden, China, the US (including Puerto Rico) with local/regional supply sites in Russia, Japan, Indonesia, Egypt, India, Germany, Mexico and Brazil. It has major formulation sites for the global supply of parenteral and/or inhalation products in the US, Sweden, France, Australia and the UK. Most of the manufacture of APIs is delivered through external sourcing that is complemented by internal capability in Sweden.
For biologics, the company’s principal commercial manufacturing facilities are in the US (Frederick, Maryland; Greater Philadelphia, Pennsylvania), the UK (Speke) and the Netherlands (Nijmegen) with capabilities in process development, manufacturing and distribution of biologics, including global supply of monoclonal antibodies and vaccines. In Sweden, in 2020, the company continued to complete qualification of its new biologics drug product manufacturing facility.
Overall, at the end of 2020, approximately 14,300 people were employed at 26 operations sites in 16 countries. Last year (2020) marked the completion of the delivery of AstraZeneca’s Operations 2020 plan designed to enhance supply capabilities to respond better to expanding patient and market needs. To further evolve its manufacturing and supply capabilities, the company has launched its new Operations 2025 plan, which will focus on scaling the company’s capabilities to support the continued growth of its portfolio, combined with leveraging new manufacturing technology and digital innovation
Eli Lilly and Company In 2020, Eli Lilly and Company reported that it will invest more than $470 million to build a new parenteral (injectable) product and delivery device manufacturing facility in North Carolina’s Research Triangle Park. Lilly currently has seven manufacturing sites located in the US at sites in Indiana, New Jersey, and Puerto Rico.
In late 2019, Lilly announced plans to invest $400 million in its manufacturing facilities at its Lilly Technology Center campus in Indianapolis, Indiana. The investment includes enhancements to existing manufacturing facilities that make insulin, additional capacity for its diabetes medicines and initial capital investments for future medicines.
Takeda. In September (September 2020), Takeda opened a new 24,000-square-foot R&D and clinical cell-therapy manufacturing facility at its R&D headquarters in Boston, Massachusetts. The facility will produce cell therapies for clinical evaluation from discovery through Phase IIb trials to support Takeda’s clinical trials globally.
Biogen. Biogen announced plans earlier this month (March 2021) to build a new gene-therapy manufacturing facility at its Research Triangle Park manufacturing campuses in North Carolina. With the new 175,000-square-feet facility, Biogen plans to expand existing operations and the combined workforce of approximately 1,900 employees at both of its campuses in Research Triangle Park. Biogen anticipates that the new facility will create approximately 90 new jobs, with an estimated total investment of approximately $200 million.
In addition, Biogen has a drug-substance manufacturing facility and a drug-product manufacturing facility and supporting infrastructure in Research Triangle Park, including a parenteral facility and an oral solid dose products manufacturing facility. The parenteral facility adds capabilities and capacity for filling biologics into vials and is principally used for filling product candidates. It also has an oligonucleotide synthesis manufacturing facility in Research Triangle Park. In Europe, Biogen is building a large-scale biologics manufacturing facility in Solothurn, Switzerland. As of the end of 2020, the company expected this facility to be partially operational during the first half of 2021.
Novo Nordisk. Last month (February 2021), Novo Nordisk announced plans to invest DKK 500 million ($82 million) to expand table production facilities at its site in Måløv, Denmark. The facility currently manufactures products for oral diabetes treatment and will be expanded to ensure capacity for future production of these products. The project is expected to be completed in 2022. The Måløv site includes the company’s largest research center with production facilities for both diabetes and biopharmaceutical products. The site produces the oral dosage form of semaglutide, a treatment for Type 2 diabetes. The site currently employs around 700 people.
In 2020 (February 2020), Novo Nordisk announced plans to invest DKK 800 million ($117 million) to upgrade and expand facilities at its production site in Kalundborg, Denmark, which currently manufacture a range of diabetes products. The facilities will be rebuilt and expanded to allow for future production of diabetes-treatment products as well as future diabetes products. The projects are expected to be completed in 2022. Established in 1969, the Kalundborg site covers a total area of 1.2 million square meters and employs more than 3,000 people.