A longtime foundational business for the contract manufacturing industry, the solid dosage form exits 2013 as active an area as it’s been in years. Multiple companies have scrambled to add technological capabilities and plant capacity in order to meet the needs of an evolving client landscape and to build on strengths independent of Big Pharma. Contract Pharma talked to several CMOs about their strategies in solid dosage manufacture for the next half-decade. Some executives spoke primarily of responding to direct customer needs, while others talked mostly in terms of adding to an overall profile of services that could be offered to a variety of prospective clients, but every company we spoke to seemed resolute about one thing: 2014 is not a time to leave any avenue for new business unexplored, or see any current client needs unmet.

Jeremy Drummond, Aesica Pharmaceuticals’ sales director Formulated Products, was one of several CMOs to talk about a recent direct expansion in manufacturing infrastructure as a key to being able to meet future trends. Aesica added a facility in Queenborough, UK in September to meet a direct client need — a solid dosage treatment for Type 2 diabetes — in a way that should define its business in solid dosage forms for years to come. “This is a major investment so that we can expand to an additional billion tablets,” Mr. Drummond said. Noting it was less than two years from the planning to the opening of that facility, he contended that simply having the flexibility to rapidly add capacity was itself a feature that more CMOs were going to find valuable. In Queenborough, he said, Aesica was “able to demonstrate how quickly we’ve been able to take a facility from grass to full production. I’m expecting more of that to happen in coming years and to become a continual trend in the industry.”

In a similar move, Patheon added Banner Pharmacaps in late 2012, in part because of how management sees the marketplace developing over the next several years. Dr. Anil Kane, excecutive director, Global Head Of Formulation Sciences, told us, “With the acquisition of Banner we acquired the technologies that were available — the people and the infrastructure, everything they had to offer.” Patheon has also increased capacity at existing facilities in the UK and in France with significant capital outlays, to better take on more business in this area, including more development business that starts and then hopefully remains with Patheon.

Norwich Pharmaceuticals’ president, Terry Novak, said that more of his company’s clients are expressing an increased desire to work with one CMO/CDMO for as long as possible over the course of a drug’s lifetime, due to limited size and restricted administration profile, and he believes this will continue to be a factor for his company in the years ahead. “For these clients, working with a company from the early phases through commercial manufacturer is really important,” Mr. Novak commented. By focusing its resources on expanding their ability to work with companies in Phase I, Norwich expects to create business for its manufacturing facilities through continuity of service. “When you look at 2014, three major products will launch commercially with Norwich that were brought in at a development phase,” said Mr. Novak.

Patheon also expressed to Contract Pharma that developing the capability of serving clients during Phase I was expected to have an effect on commercial manufacture. “We strongly believe that this trend will continue and will be key in the marketplace,” said Dr. Kane.

Other CMOs spoke less in terms of driving business to different segments of their company than opportunities to build on existing strengths, and thus are adding manufacturing services as part of their array of existing services. For Claire Madden-Smith, commercial director at Nottingham, UK-based Molecular Profiles, manufacturing is a natural extension of the company’s existing work in high-end characterization and consulting and should be an enhancement for that business in years to come. This has meant an enormous investment in infrastructure and equipment and building personnel depth, and targeting specific areas for GMP capability in which Molecular Profiles already has a high level of understanding, such as hot melt extrusion.

Aesica’s Mr. Drummond foresees key technological partnerships being created to match specific client needs, with displayed efficiencies in manufacturing being attractive to partner companies that feature a specific technology. He noted, “With continuous tablet processing, we have a partnership around a particular technology; basically, we have a partner that’s interested in focusing its development pipelines through this technology because of the benefits it brings; they’ve chosen Aesica for our manufacturing prowess to take it forward hand in hand with them.”

In contrast, Mr. Novak at Norwich foresees a client base of small to mid-sized companies content to work with CMOs that are able to steer them in the direction of companies with the solutions they require.

Nearly every CMO we contacted saw opportunities to partner with generics in the years to come. “One area that’s impacted going forward is we’re seeing quite a lot of activity with the major generic houses that traditionally have overcapacity. They’re looking at what they can do to restructure their manufacturing networks, which may yield opportunities for the CMOs,” Mr. Drummond said.
“Most definitely generics is a growing market,” Terry Novak told us. “ We have seen an increase in generic companies coming to us for a proposal. The majority of prescriptions are generic. When we sat down to do our strategic planning for 2014, our number one item was becoming more efficient in manufacturing. It is absolutely a critical success factor for all of us — cost of goods is important no matter if it’s generic or branded, but it’s even more important on the generic side. How we become more efficient should continue to be a big issue moving forward.”

Tim Compton, executive director of Business Development at AAIPharma, told Contract Pharma that his company, which was recently merged with Cambridge Major Laboratories, also expects to continue seeing business from generics, but that it’s up-front in terms of what it supplies the larger marketplaces favored by many generics, in terms of cost per unit. “We try to be straight forward with them, tell them what we can be and what we can’t be,” he commented.

Mr. Novak sees CMOs becoming more efficient for potential clients by adjusting their business practices to reflect the needs of current clients more than former ones, accommodating a client base with very different concerns than traditional Big Pharma. Companies increasingly seek feedback from their personnel, along the lines of, “Tell us what we’re doing that’s stupid.”

Patheon’s Dr. Kane was among the CMO executives who described an increasing desire from clients to work globally rather than regionally, which he contended should drive the acquisition of facilities and also investment in the capacity to serve as many markets as possible within existing plants. “There could be some differences in the timing of getting filings and approvals, but the products we expect to see developed are the products for a global market,” he commented.

That said, Mr. Drummond sees CMOs moving less of their work to Asian facilities, or perhaps limiting the kinds of plants that are opened there. “At one time, the trend was, ‘Let’s move everything to Asia!’ Now we’re not seeing that. With big products what you’re seeing is they may make the bulk ingredients in Asia. Their supply chain demands greater flexibility, so the bulk material is brought into a manufacturing site in Europe, where they can manage a multi-country supply.”

North American facilities should remain attractive in the short term. Mr. Drummond sees his company pursuing a North American facility for proximity to new technologies” “We would very much like to get a North American facility that meets our criteria with out acquisition strategy: a sustainable site that in the case of the U.S. would improve our globe footprint, bring in new technologies and new partners as well. It brings us a local presence for that market. We want to broaden our value proposition to our customers.”

Mr. Novak told Contract Pharma that NY-based Norwich expects to continue seeing opportunities from smaller and mid-sized companies that are U.S. based, perhaps on the opposite coast. Among the companies contacted by Contract Pharma, only AAIPharma indicated that it foresaw clients remaining primarily interested in targeted releases and serial approvals, as opposed to global. Noted Mr. Compton, “We expected to see a lot of companies looking for a specialized approach: an indication in a market and then going from there, as opposed to casting a wider net.”

Molecular Profiles, acquired by Columbia Laboratories in September 2013, is currently putting together a business development team to determine how to best to make use of that presence in the North American market. Rare among CMOs we spoke to, Ms. Madden-Smith also noted that her company is seeking to establish “a foothold in Japan. As part of our developing offering we have designed our facility to handle highly potent materials and the high level of interest from Japan, the U.S. and Europe is pushing us to expand further in this space.”

Mr. Novak at Norwich said his clients are desperate for companies with multiple-market regulatory experience. “There are many companies that want to impact that market without having to manufacture in that country,” he said. He was particularly bullish on future opportunities in Korea, and said that Japan seems the toughest of the Asian countries in which to gain a foothold. “We also have a few countries in Africa we ship to as well. It depends on the overall strategy for the client’s product — but the capability of doing that will be important.”

What forms will those global releases take? Dr. Nicholas Johnson, Strategic Marketing Advanced Delivery Technology at Catalent Pharma Solutions, told Contract Pharma that the variety may astonish: “We continue to see strong and increasing demand for oral dose forms of increasing complexity. Dose complexity takes various forms and many drug delivery technologies assist in optimizing the final product. For example, controlled release formulations, such as delayed or sustained release products, have been established for some time, but what we are now seeing more frequently is multiple controlled release profiles and/or modified release in a single dose.  Where a customer is developing a combination product, it is now possible they are going to require a discrete delivery profile for each of the two or three active ingredients that the combination product contains.” Catalent also projects business in fast dissolve dose forms. “With the rapidly aging population there is a concurrent need to address age-related illnesses, but also to produce dose forms that can be readily taken by the elderly population, who can often struggle to swallow conventional dose forms.”

Dr. Johnson sees challenges ahead for companies that wish to address the bioavailability enhancement of poorly soluble drugs, citing Catalent’s OSDrC® OptiMelt™ platform for hot melt extrusion as a first step into an area that should yield a variety of solutions, believing that “the downstream processing of the extrudate into the variety of solid oral dose forms can be further developed to make this technology widely applicable to the full gamut of oral dose technology.” He stressed a general upswing in manufacturers combining technologies to meet the needs of their clients whenever possible.

Fred Schulze, vice president, Sales & Marketing at Coating Place Inc., remarked, “We have a number of projects recently that require dispersal of the active over a substrate for content uniformity or solubility issues. The drug-loaded substrate is then blended with excipients and compressed into a tablet.” He noted that Coating Place has added quite a bit of blending and tablet compression equipment to satisfy the need. In the past year, Coating Place has opened a second 60,000-ft.3 facility and plans to increase the coating capacity of its original facility by 1.5 million kg.

Rob Goshert, AAIPharma’s vice president, Sales & Client Services, told us that he also expected to see more business from complex products in terms of their delivery system — whether it’s extended release, sustained release or bimodal, and that includes more combination drugs. “We have formulators working with clients before anything is signed, figuring out what their endgame needs to look like. We give them a delivery system that has patent protection or barrier to entry or that is so unique in their delivery that there’s a perceived advantage.”

Dean Childers, senior director of Manufacturing, Packaging & Technical Services at AAIPharma, indicated that the more complex items might lead to partnerships with clients on spray coating technologies and bi-layer table manufacturing. “We’re trying to find those real niche markets.”