Gil Y. Roth11.06.09
Outsourcing & Vaccines
All signs point to growth for vaccine services
By Gil Y. Roth
During the past decade, a number of major pharma companies entered the vaccine market, growing through internal investment or acquisition. At the same time, we’ve seen a burst of vaccine-focused biotech startups. The surge of interest in this field is no surprise; according to a report from Scientia Advisors, worldwide sales of vaccines are expected to rise from $16 billion in 2007 to $35 billion in 2014. (This covers both prophylactic and therapeutic vaccines.) It’s also been a decade of panic; from biodefense to SARS to avian flu and now the swine flu pandemic, there’s been a seismic shift in vaccine funding this decade.
Of course, the biggest interest in vaccines right now is the H1N1 influenza vaccine, intended to combat the spread of swine flu across the planet. Worldwide orders for H1N1 vaccines are approximately $7 billion, according to a report in the Boston Globe. Countries are ordering hundreds of millions of doses from major suppliers like Sanofi-Aventis, Novartis, GlaxoSmithKline, Baxter, CSL and AstraZeneca (through its MedImmune acquisition), while smaller companies are working on new technologies that could sidestep traditional production methods and lead to faster manufacture of more efficacious vaccines.
With the vaccine market undergoing a spike in demand, and so many smaller players on hand, it’s fertile ground for contract service providers across the spectrum, not just for fill/finish operations. We spoke to CMOs, CROs, packagers and filtration/processing companies to find out how the upswing in vaccines, particularly the crash course for H1N1, is affecting them.
“Due to the large volume and custom fill/finish requirements — fast track, short duration — of the vaccine manufacturers, CMOs were utilized for a large portion of the H1N1 supply chain in 2009,” said Milton Boyer, vice president sales, marketing and business development of OsoBio, a CMO based in Albuquerque, NM. Mr. Boyer contended that the role of CMOs in this year’s H1N1 scare may be more than a one-time jump. “Future H1N1 vaccine requirements in the coming years are likely to be manufactured at CMOs due to successful FDA and EMEA regulatory approvals in 2009,” he remarked. “This initiative has consumed a considerable amount of CMO industry capacity in terms of facilities and human resources. The net effect has been a trickle-down of business from the larger to the mid-size and smaller CMOs. The introduction of the major pharmaceutical companies to the mid-size CMOs will bode well for future business opportunities for this segment of the CMO industry.”
Sharp Corporation, a contract packager based in Conshohocken, PA, has also seen its business grow during the current crisis. Dan Stehn, Sharp’s director of Biotechnology Packaging, told me that his company is also seeing growth from non-vaccine projects as clients try to free up internal capacity. He said, “During the past year we have spoken with a number of clients that — in addition to looking for short-term surge capacity to support their vaccine programs — are evaluating options to create capacity by outsourcing some of their non-vaccine injectable programs.”
He added, “Sharp Corporation’s role with respect to vaccines as well as all other injectable products is strictly for the labeling and secondary packaging of products which have either been manufactured at one of our clients facilities or by a CMO. As the global market for vaccines continues to escalate, we’re investing in syringe labeling and assembly equipment that will provide us with the capability to handle pre-filled syringes in addition to vial presentations that we’re currently handling.”
The U.S. order for for H1N1 vaccine includes a requirement for pre-filled syringes, eschewing traditional multi-dose vials. Some believe that this demand
- is intended to allay the fears of the thimerosal-causes-autism crowd, and
- is a key contributor to vaccine shortages in the U.S.
While much of the supply shortfall is attributable to the vagaries of that antiquated process, Novartis also noted that it was suffering a lag in filling capacity. Which makes its unexpectedly low yields — as low as 20% of expected quantities, according to some reports — a mixed blessing, I suppose.
The upside to the U.S. policy is that providers with pre-filled syringe capabilities are in position to boom.
Catalent Pharma Solutions, headquartered in Somerset, NJ, is making inroads in that area. The company’s Sterile Technologies segment has gained business from H1N1 makers, supporting several customers with its high-speed pre-filled syringe lines, while its Packaging Services unit has also benefited. “For the last few years we have recognized a trend by bio/pharma companies to move away from multi-dose vials into single-dose pre-filled syringes,” said John LaHaye, vice president of business development, Packaging Services, Catalent Pharma Solutions. “Catalent made significant capital investments into the design and implementation of specialized labeling and packaging equipment and lines. As a result, Catalent is in a position to effectively respond to the global pandemic vaccine packaging demand partnering with key vaccine manufacturers. This has been a major growth contributor to our business.”
HollisterStier-DRAXIS Contract Manufacturing, another CMO with a history in vaccines, appears to be benefiting from new heightened demand. “The manufacture of vaccines has always been a core competency of HollisterStier,” said David Flowers, the company’s director of business development. “Our system is finely-tuned to manage the challenges presented when global circumstances demand large-scale production of time-sensitive products. Our success with vaccine production has certainly been a contributor in our growth, among other factors. Revenues that will be realized through some key partnerships by the end of our fiscal year allow for continued expansions to our facilities and service offerings that will position us well in future.”
Similarly, companies like Millipore and Sartorius Stedim Biotech, providers of equipment, components and services for bio-manufacturing, have experienced an uptick in revenues. “The supply pressure the H1N1 pandemic put on the vaccine industry has caused the industry to accelerate the implementation of disposable technologies and the development of cell culture based flu vaccine,” said Maik W. Jornitz, group vice president, marketing and product management, Filtration and Fermentation Technologies, at Sartorius Stedim Biotech.
He added, “Disposables technology, mainly hold bags or bag assemblies, are essential to turn around a production facility fast, helping bypass tedious cleaning and set-up time. While cell-culture-based processes increase the yield to volume ratio and avoid elevated bioburden loads, they also allow the use of disposable bioreactors, which incorporate benefits similar to disposable bag assemblies. We not only expected such future demand, but developed dedicated disposable equipment, together with our client base.”
Hurry Up and Wait?
We shouldn’t get too ahead of ourselves with all this new technology. In recent weeks, the big news has been the shortage of vaccine because of reduced yields from the egg-based manufacturing system that has been in place since 1940.
“The shortfall of seasonal flu vaccine and the lower than expected production of H1N1 vaccine are due in part to yields from egg-based systems. This has created an opportunity for the CMOs that already have or are willing to bring these processes in-house,” said Gregory Gonzales, president of Grand River Aseptic Pharmaceutical Packaging. Mr. Gonzales noted that his company isn’t presently pursuing an H1N1 program, “but we are receptive and in discussion with an organization that has proprietary vaccine production technology.”
“We have in recent months seen an influx of inquiries for the manufacturing of vaccines, specifically in relation to the H1N1 vaccine,” said a spokesman at Cytovance Biologics, a CMO based in Oklahoma City, OK. “We are seeing solicitations not only from the U.S. government but also several from the private sector as well. There is an immediate need worldwide for manufacturing capacity to fill the vaccine stockpile and fight the outbreak of the H1N1 flu. Clients are looking for a rapid turnaround of millions of doses of the vaccine; we are seeing a real sense of urgency to combat the current shortages.”
Rick Lapointe, vice president of technology and acquisitions at OsoBio, echoed those sentiments about the urgency of H1N1 outsourcing projects. “We provided development and manufacturing services for a live attenuated virus in support of the H1N1 vaccine supply initiative,” said Mr. Lapointe. “The project was evaluated for appropriateness in a multi-product facility by using the ISPE Risk Map Base Guideline. It was an ultra fast-track project with a timeline of less than two months from concept to availability to the customer. Capacity availability at the time it was needed (flu season) was key in meeting the needs of the customer. Our challenges in meeting the timeline included acquiring specialized equipment, acquiring mass quantities of product components, cold chain management and completing a multitude of validation activities in a short amount of time by working 24/7. Despite these requirements, we met the goal and have forged an ongoing relationship with the new customer.”
When Pigs Fly (Or Flu)
As fast as the CMOs can operate, they’re still hamstrung when the big step — making the bulk vaccine supply — relies on that egg-based production model that takes four to six months.(Except for AZ/MedImmune’s FluMist nasal spray vaccine, which uses egg-based manufacturing but has a novel method that shaves time off the production process.) Several years ago, you may recall, avian flu was the scary potential pandemic. As part of the U.S. response to that threat, billions of federal dollars were committed to building next-generation cell-culture-based vaccine manufacturing facilities. The idea was to wean us from egg-based manufacturing and its interminable lag times.
(Not to take this conversation into uncomfortable territory, but you’d think that vaccine makers would’ve put up the money for the new facilities themselves, if the goal was to improve productivity. Of course, if there weren’t government price restrictions on vaccines, they probably would’ve done it on their own much earlier. Of course, the unpredictability in year-to-year demand may also slow down the momentum for next-gen manufacturing. Of course, it only takes one company to do so to create a market differentiation. Of course, any advances in cell-based vaccine manufacturing, like Baxter’s Celvapan, need to go through a rigorous FDA approval process, despite having already reached the market in the EU. But I digress.)
It’s only been a few years, so for now we take smaller steps, as researchers and engineers try to figure out ways to use cell-culture-based production for something as large scale — and as variable in optimal dosage — as pandemic vaccines. In May 2009, the FDA licensed Sanofi-Aventis’ new site in Swiftwater, PA to produce flu vaccine. The site employs the egg-based production model, but Sanofi-Pasteur, SA’s vaccine’s division, assures it’s “the latest technology in egg-based vaccine production,” and will boost the company’s total capacity in the U.S. to 150 million doses of trivalent seasonal flu vaccine. Sanofi boasts that it produces around 40% of the world’s flu vaccines. It too has had trouble with low yields, but plans to fulfill its U.S. order of 75 million doses by the end of 2009.
One CMO we spoke to has quite a long history with vaccine manufacturing. JHP Pharmaceuticals’ Rochester, MI facility was originally a Parke-Davis site, and was the first biological license holder for vaccines and other biological products manufactured in the U.S., according to company president Stuart Hinchen. He remarked, “Our site manufactured approximately 25% of the seasonal flu requirements of the U.S. as early as the 1950’s, and up through 2000. During that time, the U.S. supply was also manufactured by Connaught and Wyeth, which were domestically based. But FDA’s requirements to advance the manufacturing process to something more modern — as well as economic pressures around flu vaccine manufacturing — forced seasonal vaccine manufacturing to move offshore, and the physical capacity here in the U.S. was subsequently diverted to alternate use.” JHP, he added, retains a large numbers of staff that were previously involved with seasonal flu production and testing at the Rochester site.
“The convergence of the seasonal flu and H1N1 requirements is a classic embodiment of the problems facing pharmaceutical companies and why they need to have external manufacturing alliances,” Mr. Hinchen remarked. “The current shortage in supplying both seasonal and H1N1 flu vaccine is symptomatic as much of over-committing internal manufacturing capacity as it is of slow-growing antigen supply.” He noted that JHP has participated with a major pharmaceutical company in preparing for supply of H1N1 vaccine, although that company must resolve its issues with production of bulk vaccine.
J’Approve!
With all this talk about speed and efficiency in manufacturing, we can’t forget that these vaccines need to be approved by the FDA and other nations’ regulatory bodies. And that means CROs needed to manage clinical studies in a major hurry.
“The speed with which industry was expected to respond to H1N1 demanded a lot from the CROs that would manage clinical activities,” said Lee Barsky, vice president, CRO Services, at Accelovance, a Rockville, MD-based CRO that focuses on vaccines.
E.B. McLindon, Accelovance’s chief operations officer, added, “The government turned to sponsors and expected speed. Sponsors turned to CROs and manufacturers and demanded speed. CROs had to respond with rapid study initiation and controlled enrollment. Well managed programs meant the public received vaccines faster.”
Stephanie Wells, senior vice president and chief marketing officer for Charles River Laboratories, a CRO based in Wilmington, MA, said, “We are seeing a growing demand for vaccine-related services and, as a result, are continuing to expand our expertise and resources to help our clients with their vaccine programs.”
The company supports vaccine-makers by “provide customized programs based on the route of administration and nature of the vaccine, including inactivated/attenuated microorganisms and recombinant or native antigens, among others,” according to Ms. Wells. The company has also developed a database to maintain adverse event data and correlate it for investigational drugs’ effects on potentially challenged immune responses.
Life After H1N1
Of course, it’s not all about swine flu. There’s plenty of other work going on in the vaccine field, and contract service providers are in the midst of it. Les Edwards, chief executive officer of Isogen, a CMO with facilities in Newark, DE, remarked, “We are seeing a trend where the big pharmaceutical companies are pursuing the most efficient and cost-effective ways to bring these specialty vaccines to market — and they are finding the small-scale, specialty CMO to be their best option.”
Mr. Edwards mentioned that Isogen was recently contracted to manufacture an anti-cancer vaccine for a biotech company, and is developing more scalable processes and formulations as the vaccine moves into Phase II and Phase III trials. The company also recently began work with another biologic drug development company on a viral vaccine for respiratory and gastrointestinal indications. “The market is seeking facilities that have expertise in antibody-drug conjugates and live-virus vaccines,” noted Robert Roy, Isogen’s director of manufacturing.
Steve Trevisan, chief executive officer at Accelovance, concurred, remarking, “While vaccines have gained greater publicity from H1N1 and concerns over influenza in general, we must not overlook how they may impact other conditions such as hepatitis, infectious diseases, and cancer.”
Ms. Wells at Charles River noted, “We recently conducted work with novel methods of delivery such as electroporation and is looking at validating other methods such as injector devices. We have established toxicology programs for novel adjuvants and recombinant vaccines designed to elicit an autoimmune response for use in tumor therapy and hormone control. In the past months, we have received a number of inquiries from pharmaceutical and biotech companies seeking safety assessment of their innovative therapeutic vaccines. We are also currently conducting a vaccine study for a DNA virus, which required Biosafety Level 2 approval by the National Institute of Health (NIH) Recombinant DNA Committee.”
“We do a significant amount of vaccine-related work in both process development and cGMP production (also in our consulting business),” said Roger Lias, Ph.D., president of Eden Biodesign Ltd., a biopharma and vaccine development organization based in Liverpool, England. “We have seen very significant market interest recently in the development of viral vaccines including adenoviral products — for which we have developed a platform approach — rAAV, lentivirus, MVA, JEV, retrovirus and so on. For obvious reasons we make full use of disposable systems — including single use stirred tank bioreactors — in the viral production areas.” He noted that the company has done some work with seasonal influenza products, but has nothing going in the H1N1 arena.
Dr. Crawford Brown, chief executive officer at Eden Biodesign, said, “The recent outbreak of swine flu has accelerated investment to biotech’s developing new vaccines. While the numbers of doses manufactured and shipped are getting the headlines, the bigger question is, ‘How effective will they be?’ It’s becoming clear that vaccines demonstrated to give protection to healthy normal segments of the population may not provide the same protection to at risk groups such as the elderly. In order to establish second-generation vaccines offering protection to all groups, especially the elderly, who traditionally are inadequately protected by current vaccines, requires a close co-ordination of three elements: molecular biology and associated product design, manufacturing development and preclinical/clinical evaluation.”
He added, “Unlike therapeutics, where structure and function can often be clearly assigned — thereby enabling manufacturing development to have a set of product critical quality attributes to measure during the course of process development — the understanding of the immunological processing of vaccines in man is still only partly understood. Therefore the test article used in preclinical studies to evaluate and select a candidate for development needs to be representative of the bulk purified vaccine that would be made commercially. Otherwise, on scale up undetectable changes to vaccine quality may arise, resulting in a sub-potent product.”
Dr. Lias emphasized that, while there are surface similarities between vaccines and other biologics, there are still plenty of differences between the two. He commented, “The vaccine outsourcing market is defined to some extent by the wide range of novel product types and the associated technologies required to produce them. In addition to the viral vaccines I mentioned earlier, we deal with VLPs, recombinant vaccines, whole cell microbial vaccines and others. Each requires specific expertise and technology. We see a tremendous variety of cell types compared to the ‘standard’ lines we see for traditional recombinant and antibody therapeutics.”
He added that purification processes are typically not as well developed for vaccines as they are for recombinant therapeutics, and that we can hardly call many vaccine candidates “well characterized” at this stage of the game. “For many novel vaccine products (including therapeutic vaccines) it is not simply a case of applying the same thinking and techniques as would be applied to monoclonal antibodies!” he declared.
With spikes in seasonal vaccine demand, a new wave of therapeutic and prophylactic vaccines, and advances in production and delivery technologies, there appears to be a world of opportunity for contract service providers. Provided H1N1 doesn’t take a turn for the worse and wipe us all out first.