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Mar 1, 2009 (Vol. 29, No. 5)

CMOs Hold Their Ground in Troubled Times

Long Lead Times for Projects Have Protected Contractors from Slowdown So Far

  • Economic Uncertainty

    Click Image To Enlarge +
    A process development researcher at Avid Bioservices screens mammalian cell clones using the ClonePix FL from Genetix.

    Since lead times for pharmaceutical manufacturing projects tend to be long, it is too early to tell how the global financial crunch will affect CMOs. The impact may depend on the severity of the economic downturn. A recession that falls short of the most dire predictions might turn out well for contractors. Cash-poor biotechs might delay or cancel projects, but established companies may lean on CMOs more to avoid production-related capital investments.

    Finnegan has observed that some smaller clients are doing quite well, perhaps due to the flight of capital from equities and bonds into private ventures. A more severe recession or depression, however, would likely cause all companies to scale back, thus hurting contractors. “There’s a lot of uncertainty at this point,” she notes. “Often, management determines that the safest course of action is to pull back some of its programs.”

    Avid Bioservices also experienced a year of record business, and expects 2009 to be “just as good if not better,” according to Rich Richieri, svp, manufacturing. “We have not seen any cancellations due to the downturn.”

    Single-use equipment provides CMOs with the flexibility to respond rapidly to customer needs, Richieri says. Avid uses bioreactor bags from Thermo Scientific Hyclone—100 L sizes for development, and 1,000 L for manufacturing. “Disposables allow us to provide ten to twenty grams of material quickly, even from nonoptimized clones, so customers can begin animal studies.”

    Avid is a pure-play contract manufacturer, but its parent company, Peregrine Pharmaceuticals, has two antibody drugs of its own in clinical development for cancer and antiviral indications. Last year, Peregrine received a five-year, $44.4 million contract from the Department of Defense to test its bavituximab monoclonal antibody against hemorrhagic fever.

    Improvements in volumetric productivity favorably positions CMOs, even smaller ones, for capturing longer manufacturing campaigns. Improvements have come through process improvements, feed/media strategies, and cell-line engineering.

    Avid, for example, uses the ClonePix clone-selection device from Genetix to replace manual cloning and achieve high productivity from the earliest stage of a manufacturing project. Avid acquired the ClonePix in August 2008, and so far the instrument’s performance has fully met expectations. “More and more contract manufacturers will concentrate on clone screening to achieve high-producing cell lines right away,” says Richieri.


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