Patricia Van Arnum was executive editor of Pharmaceutical Technology.

Patricia Van Arnum

Although small molecules dominate the global pharmaceutical market, the percentage share of biologic-based drugs is projected to rise reflecting both the entry of new biologic-based drugs and increased revenues for existing biologics.   

Following several years of slowing growth, the global market for medicines is expected to rebound from a projected  low of 3–4% growth in 2012 to 5–7% growth in 2016, according to a July 2012 analysis by the IMS Institute for Healthcare Informatics. Growth will primarily be from emerging markets as growth in established markets in the United States, Western Europe, and Japan remains weak comparative to historical levels. Overall, annual global spending on medicines will rise from $956 billion in 2011 to $1 trillion by 2013, to nearly $1.2 trillion in 2016, representing a compound annual growth rate of 3–6%.  

Biologics are expected to account for approximately 17% of total global spending on medicines by 2016 and reach an overall market value of $200 billion to $210 billion in 2016, up from $157 billion in 2011, according to IMS. Seven of the top 10 global medicines by spending will be a biologic within five years, according to IMS. Adoption of biosimilars as low-cost alternatives to original biologic medicines will remain limited as biologics remain protected by patents or market exclusivity in many countries. The global market for biosimilars is expected to be between $4 billion and $6 billion in 2016, representing 2% of biologics spending. In 2011, the global biosimilars market was estimated at $693 million, or only 0.4% of the global biologics market, according to IMS. 

In 2012, FDA's Center for Drug Research and Evaluation approved several new biologic license applications (BLAs) (see 

). Roche/Genentech received approval for Perjeta (pertuzumab), a HER2/neu receptor antagonist indicated in combination with trastuzumab and docetaxel for treating patients with HER2-positive metastatic breast cancer. Sanofi received approval for Zaltrap (ziv-aflibercept), a recombinant fusion protein, which acts as a soluble receptor that binds to vascular endothelial growth factor-A (VEGF-A), VEGF-B, and placental growth factor and is used to treat metastatic colorectal cancer. Sanofi partnered with the biopharmaceutical company Regeneron Pharmaceuticals for Zaltrap. Also, the generic-drug company Teva received approval for tbo-filgrastim, which was approved as an original BLA and not as a biosimiliar to Amgen's Neupogen (filgrastim), which is a previously approved biologic. Tbo-filgrastim is a human granulocyte colony-stimulating factor produced by recombinant DNA technology and is used to reduce neutropenia in patients with non-myeloid malignancies. 

 Table I: Approvals of new biologic license applications (BLA) in 2012 by FDA’s Center for Drug Evaluation and Research. 			

Also, GlaxoSmithKline received FDA approval for raxibacumab, a monoclonal antibody to treat inhalational anthrax. Raxibacumab was developed by Human Genome Sciences (HGS) in conjunction with the Biomedical Advanced Research and Development Authority of the Office of the Assistant Secretary for Preparedness and Response, US Department of Health and Human Services. HGS was acquired by GSK in July 2012. ThromboGenics received FDA approval for Jetrea (ocriplasmin) for treating vitreomacular adhesion. Alcon, a division of Novartis, acquired the rights to commercialize Jetrea outside the United States in March 2012; ThromboGenics retains US rights. 

Articles

The share of biologic-based drugs in the global pharmaceutical market is on the rise.

Tracking Growth in Biologics

Chiral chemistry plays a significant role in the development of pharmaceutical intermediates and APIs, and as such, advances in asymmetric synthesis are of value to pharmaceutical companies. Researchers in academia and industry continue to develop new routes for achieving desired enantioselectivity. 

ALFRED PASIEKA/PHOTOLIBRARY/GETTY IMAGES			

The global market for chiral technology, inclusive of applications in pharmaceuticals, is expected to show moderate growth during the next five years. The global chiral technology market was worth nearly $5.3 billion in 2011, according to a recent analysis by BCC Research. This market is expected to increase at a compound annual growth rate (CAGR) of 6.5% from 2011 to 2016 and will approach $7.2 billion by the end of the forecast period. Chiral-synthesis products accounted for the majority of the chiral technology market in 2010, with an 80.% share (i.e., $3.9 billion in revenues). This market segment was estimated at $4.2 billion in 2011 and is expected to be $5.7 billion by 2016, a five-year CAGR of 6.4%, according to BCC. The chiral analysis market was valued at $785.7 million in 2010 and grew to $839.4 million in 2011. This market is projected to reach nearly $1.1 billion by 2016, a CAGR of 5.8% during the five-year period, according to BCC. 

A review of recent literature reveals several interesting approaches in chiral chemistry. One approach involves the synthesis of rare sugars, which have potential in several important applications, including as chiral building blocks in natural-products synthesis. Current production methods, however, use costly and complex biochemical processes to transform easily found abundant sugars into these rare ones. To address this limitation, researchers at the Massachusetts Institute of Technology (MIT) have found a way to use inorganic catalysts in place of enzymes to generate sugar epimers in a simple and robust manner, according to a Oct. 10, 2012 MIT press release.  

Typically, biochemical processes used to generate rare sugars from more abundant sugars involve three main classes of enzymes, two of which, isomerases and oxidoreductases, are active on a wide range of simple substrates, but which also can result in the formation of side products. For example, xylose isomerase converts glucose into fructose and simultaneously converts fructose into mannose. These processes have generated some commercially available rare sugars, but the complex nature of that biochemical process makes it costly, according to the MIT release. The third class of enzymes, epimerases, are potentially the most useful biocatalysts for the widespread production of rare sugars because they offer high specificity for products and are capable of selectively modifying sugars at multiple carbon positions. Like all biological catalysts, however, epimerases can be fragile because they require specific reaction conditions and can only act on previously functionalized sugars. 

The MIT researchers reported using inorganic catalysts in place of the enzymes to generate sugar epimers, thereby offering an alternative to biocatalysts in the selective conversion of sugars (1). The catalytic system involves using a tin-substituted microporous silicate (Sn-Beta zeolite) combined with a borate salt. The MIT researchers  found that Sn-Beta zeolite in the presence of sodium tetraborate catalyzed the selective epimerization of aldoses in aqueous media. The reaction proceeds by way of a 1,2 carbon-shift mechanism, whereby C–C bonds move within the molecule's backbone, according to the MIT release.  

				Researchers at the Department of Applied Chemistry, the Faculty of Science, at the Tokyo University of Science and the Japanese Foundation Center for Cancer Research developed a method for the total synthesis of AMF-26, an antitumor agent that disrputs the Golgi system by inhibiting ADP-ribosylation factor 1 activation (2). A key part of the synthesis was the construction of the chiral linear precursor by the asymmetric aldol reaction followed by a computer-assisted predictive stereoselective intramolecular Diels–Alder reaction (2). 			

Researchers also recently reported on what they classified as the first organocatalytic asymmetric synthesis of 3,3-disubstituted oxindoles featuring two heteroatoms at the C3 position by employing the highly enantioselective amination of 3-arylthiooxindoles or 3-alkoxyoxindoles using DBAD (3). The work showed that 3-thiooxindoles and 3-alkoxyoxindoles were reactive nucleophiles for the development of catalytic asymmetric reactions (3). In other news, researchers describe their work involving a catalytic asymmetric double (1,3)-dipolar cycloaddition reaction. They reported that by using a chiral silver catalyst, enantioenriched pyrrolizidines can be prepared in one flask from inexpensive, commercially available starting materials. The pyrrolizidine products contain a variety of substitution patterns and as many as six stereogenic centers (4). 

				In the area of biocatalysis, researchers at the School of Chemical and Biomolecular Engineering, Georgia Institute of Technology, Petit Institute of Bioengineering and Bioscience and Merck & Co., successfully altered a leucine dehydrogenase through several rounds of protein engineering to an enantioselective amine dehydrogenase (5). Instead of the wild-type a-keto acid, the new amine dehydrogenase accepts the analogous ketone, methyl isobutyl ketone, which corresponds to exchange of the carboxy group by a methyl group to produce chiral (

In synthesizing pharmaceutical intermediates or APIs, broad advances in catalysis can be helpful. The research group of Professor Petri Pihko at the Department of Chemistry and the NanoScience Center of the University of Jyväskylä at the Academy of Finland recently resolved two problems in chemical catalysis, according to a Dec. 20, 2012 press release.  

Antibody drug conjugates remain a niche, but strong area of investment. 			

In the first project, the researchers designed an intramolecularly assisted catalyst for the synthesis of beta-amino acids. Previously published catalysts work only with aromatic side chains in the imines, but the new catalyst designed at the University of Jyväskylä does not have this limitation, according to the release. The method may be applied in the synthesis of beta-amino acids, which are important building blocks. For the understanding of the catalytic mechanism and design of the catalyst, the researchers collaborated with the research groups of Professor Imre Pápai at the Hungarian Academy of Sciences for computational studies, and Academy Professor Kari Rissanen at the University of Jyväskylä for X-ray characterization of catalysts. 

In a second project, the researchers identified new mechanism for the amine-catalyzed Michael addition reaction between aldehydes and nitroalkenes. The new model proposed by the Pihko and Pápai groups includes a new species, a six-membered ring, as the key on-cycle intermediate that is protonated in the rate-determining step. The work is a combination of computational and experimental studies that complement each other in understanding the reaction mechanism. Specifically, the researchers used dihydrooxazine oxides, which are stable intermediates that are protonated directly, without the intermediacy of the zwitterions, in organocatalytic Michael additions of aldehydes and nitroalkenes. Protonation of these species explains the role of the acid co-catalyst in these reactions, and the observed stereochemistry when the reaction is conducted with a-alkylnitroalkenes (6). 

BINOL and its derivatives are widely used classes of ligands in asymmetric synthesis, such as in Diels–Alder reactions, carbonyl addition, and reductions (7). Researchers at the University of Texas, Austin have developed a bifunctional catalyst derived from BINOL for producing highly enantioselective bromolactonizations of unsaturated carboxylic acids (8, 9). Specifically, the catalyst promoted highly enantioselective bromolactonizations of 4- and 5-aryl-4-pentenoic acids, but it also catalyzed the highly enantioselective bromolactonizations of 5-alkyl-4(Z)-pentenoic acids. The researchers assert that these reactions represent the first catalytic bromolactonizations of alkyl-substituted olefinic acids that proceeded by means of 5-exo mode cyclizations to give lactones in which new carbon–bromine bonds are formed at a stereogenic center with high enantioselectivity. The researchers also reported on what they say is the first catalytic desymmetrization of a prochiral dienoic acid by enantioselective bromolactonization (8, 9). 

 1. Y. Román-Leshkov, "Sn-Beta Zeolites with Borate Salts Catalyze the Epimerization of Carbohydrates via an Intramolecular Carbon Shift," 

, online, DOI:10.1038/ncomms2122, Oct. 9, 2012.  

 3. J. Zhou, "Organocatalytic Asymmetric Synthesis of 3,3-Disubstituted Oxindoles Featuring Two Heteroatoms at C3 position," 

., online, DOI: 10.1039/C3CC38819K, Jan. 23, 2013.  

 4. A.D. Lim, J.A. Codelli, and S.E. Reisman, "Catalytic Asymmetric Synthesis of Highly Substituted Pyrrolizidines," 

., online, DOI: 10.1039/C2SC21617E, Nov. 13, 2012.  

 7. W. Sommer and D. Weibel, Aldrich ChemFiles 

 485 Route One South, Bldg F, First Floor, Iselin, NJ 08830 tel. 732.346.3072, 

Researchers use inorganic catalysts as an alternative to biocatalysts in the selective conversion of sugars to produce chiral building blocks.

Gaining Stereoselectivity in Asymmetric Synthesis

The increased globalization of the pharmaceutical/biopharmaceutical industry is reflective not only in the major players' shifting patterns of revenue growth from established to emerging markets, but also in their drug-development activities, including clinical research. Although the United States and Europe still account for a dominant share of global clinical-trial studies, Asia, particularly China, continues to rise in importance as a location for clinical research. As the number of clinical trials increase in Asia and other emerging markets in Latin America, the large CROs are too expanding into these markets using a combination of acquisitions, partnerships, and select internal investments. 

Clinical research is becoming increasingly global in nature. Although the United States and Europe still represent the dominant destination for clinical studies, Asia and Latin America also are rising in importance as a location for clinical trials. 

 a public registry of clinical-trials information for federally and privately funded trials conducted under investigational new drug applications maintained by US National Institutes of Health, identifies 139,372 registered clinical studies in the US and 182 countries, according to data as of Jan. 25, 2013. US-only sites accounted for 41% of registered studies, and non-US only studies 43%. Six percent of registered studies are in both the US and outside the US, and in 9% of the studies, the location was not specified. The US and Canada combined account for 77,030 studies or 53.3% of the global total registered in 

 and Europe accounts for 37,454 or nearly 27%. East Asia (including China, but excluding Japan) has 11,954 studies or 8.6% of the global total, and Southeast and South Asia a combined 5320 registered clinical-trial studies or 3.8% of the global total, according to 

. Mexico, Central America, and South America collectively have 8332 or 6.0% of the global number of registered clinical studies.  

As the globalization of clinical trials continues, the major CROs are expanding their operations in Asia and South America. In January 2013, Charles River Laboratories acquired a 75% ownership of Vital River, a commercial provider of research models and related services in China. For the past 10 years, Vital River has been a licensee for production and distribution of Charles River's research models in China. The agreement provides an option for Charles River to acquire the remaining 25% of Vital River at a later date. As part of the Vital River acquisition, Charles River will be the exclusive global partner for distribution of model-creation services offered through Beijing Vital Star Biotechnology. The services of Beijing Vital Star Biotechnology include humanized model creation using inducible pluripotent stem cell and other technologies. 

In June 2012, Quintiles announced its plans to establish a Quintiles regional headquarters for China in Shanghai and expand laboratory-testing capabilities in China, which includes a partnership with Shanghai Clinical Research Center (SCRC). Under a joint-venture agreement, Quintiles will engage SCRC to provide laboratory-testing services to local customers. Founded under the collaborative framework of the Ministry of Science and Technology and Shanghai Municipality in 2008, SSCRC is a full-service clinical research center in China. To provide the infrastructure for its growth strategy in China, Quintiles is investing $14 million to establish a new 4000-m

 headquarters in Shanghai to serve China and nearby Asian countries. The facility is expected to accommodate more than 450 employees in the next five years. The Quintiles–SCRC collaboration follows the 2011 launch of Kun Tuo, a Quintiles' CRO that serves local and global biopharmaceutical companies in achieving successful registration of medicines in China. Quintiles began operations in China in 1997 and now has existing offices in Beijing, Dalian, Hong Kong, and Shanghai.

Quintiles is expanding elsewhere in Asia. In October 2012, Quintiles began its first global study involving Indonesia, made possible by an exclusive alliance with Prodia Clinical Laboratory for in-country testing of samples from Indonesian patients in clinical trials. In an Oct., 24, 2012, press release, Quintiles noted prior to its partnership with Prodia that Indonesia had been difficult to include in global trials because of requirements that all local samples be tested in-country before samples or data could be exported. In November 2011, Quintiles announced an exclusive partnership with the Jakarta-based Prodia Clinical Laboratory, through its sister company Prodia, which gave Quintiles exclusive access to Prodia's central laboratory for a two-year period.  

To enhance its bioanalytical service offerings in Asia, Quintiles formed, in December 2012, an exclusive partnership with BioCore, a Seoul, Korea-based bioanalytical CRO. BioCore is a provider of bioanalytical liquid chromatography–tandem mass spectrometry. Under the agreement, BioCore will provide its services to Quintiles exclusively for a two-year period. Quintiles' growing global bioanalytical capabilities began with its acquisition of Advion BioServices in 2011. In July 2012, Quintiles opened a global commercial solutions business in Brazil. Quintiles had earlier expanded its global commercial solutions business into Russia, the Middle East, and North Africa.  

In 2012, Covance reported that its early-development facility in Shanghai, China received a good laboratory practice certificate from China's State Food and Drug Administration. The Covance facility in Shanghai provides nonclinical safety assessment, bioanalytical, 

 pharmacology, and drug metabolism and pharmacokinetics (DMPK) services. Covance opened the facility in August 2010.

PAREXEL opened a customer-care office in Shanghai in December 2012 for Perceptive Informatics, a subsidiary of PAREXEL and eClinical solutions provider. In November 2012, PAREXEL formed an alliance with the National Taiwan University Hospital to provide drug-development services in Taiwan. Earlier in 2012, PAREXEL was chosen by the Korea Drug Development Fund (KDDF) to serve as the fund's CRO. The KDDF is a consortium of three health-related Korean ministries: the Ministry of Knowledge Economy, the Ministry of Education, Science and Technology, and the Ministry of Health and Welfare. KDDF was established in September 2011 with assets of $1 billion to develop at least 10 new drugs by 2019 for the global market. The alliance with KDDF follows PAREXEL's 2012 collaborative research agreement with the ASAN Medical Center based in Seoul.   

In October 2012, ICON and the Korea National Enterprise for Clinical Trials (KoNECT) formed a partnership to advance the clinical-trials industry in South Korea. Through the agreement, ICON and KoNECT will collaborate on a series of educational events for local and multinational pharmaceutical companies, investigators, and industry officials. KoNECT was established in 2007 with the support of the South Korean government, academic institutions, and life-science industries to provides clinical-research resources, training, and support.  

In February 2012, ICON completed its acquisition of BeijingWits Medical Consulting, a CRO in China with staff located in Beijing, Shanghai, Chengdu, Guangzhou, Wuhan, and Hong Kong. The company provides services for Phase I to Phase IV clinical studies to global and local pharmaceutical, medical device, and biotechnology companies. Also, in 2012, INC Research opened a facility in Seoul, South Korea. INC Research provides Phase I to IV clinical development services in the Asia/Pacific region with coverage across China, India, Australia, Singapore, Philippines, South Korea, Taiwan, Hong Kong, Malaysia, Thailand, and New Zealand.  

The CROs WuXi PharmaTech and PRA signed a joint-venture agreement in December 2012 to offer a broad platform of Phase I–IV clinical trial services in China, Hong Kong, and Macau. The joint venture will provide services, including clinical-trial monitoring, project management, regulatory strategy and submissions, data management, biostatistics, drug-safety reporting, and medical monitoring. The clinical operations of WuXi and PRA in China will combine to operate as an independent CRO and will be jointly owned by their respective parent companies. WuXi will contribute clinical and regulatory experience to the joint venture from its China-based clinical organization. That organization covers all regions of the country and has employees working in 16 Chinese cities, with offices in Shanghai, Beijing, and Guangzhou. WuXi also will supply laboratory services to the joint venture through a preferred-provider arrangement. PRA will support the joint venture on with its global expertise and staffing and with its China-based staff and global technology capabilities, encompassing data capture, trial management, and other information-technology systems. The companies will market the joint venture's services to their respective customers. In February 2012, PRA also opened an office in Singapore for PRA's central clinical operations location for the region. 

Sidebar: Partnerships in drug development in China: AstraZeneca and WuXi AppTec

Biopharmaceutical/pharmaceutical companies partner with CROs in emerging markets for various reasons. Access to large pools of patients or targeted patient populations important to the development of a particular drug and potentially lower costs comparative to Western-based CROs are some common reasons. As emerging markets, however, become increasingly important in the revenue position of the major companies, partnering with domestically domiciled contract services providers also provide biopharmaceutical/pharmaceutical companies a way to access local markets.  	

The use of such partnerships as a vehicle for pharmaceutical/biopharmaceutical companies to access local markets is evident in a recent partnership between MedImmune, the biologics arm of AstraZeneca, and the China-based CRO WuXi AppTec, to advance a biologic-based drug being developed by AstraZeneca.  

In September 2012, MedImmune and WuXi AppTec formed a joint venture in China to develop and commercialize MEDI5117, a novel biologic for autoimmune and inflammatory diseases. Under the agreement, MedImmune is providing technical and development expertise, and WuXi AppTec is providing local regulatory, manufacturing, preclinical, and clinical-trial support. When undertaking clinical-trial development in China, the government requires local manufacture of medicines that have not been approved in other markets. The joint venture will control the development of MEDI5117 for autoimmune and inflammatory diseases in China, and the two companies will have equal ownership in the joint venture. AstraZeneca/MedImmune will have the option to acquire the full rights to commercialize MEDI5117; otherwise, the joint venture will have the right to commercialize the product. WuXi AppTec will earn revenue based on services provided to the joint venture. MedImmune will receive various milestone payments as the program progresses. 

MEDI5117 is a fully human monoclonal antibody that depletes IL-6 and bears MedImmune's proprietary half-life extending mutation (known as the "YTE" technology) designed to give a long duration of action. IL-6 is known to be an important mediator in the production of inflammation and pain in a variety of disease states. MEDI5117 is currently in Phase I in the US and Europe. In China, a local investigational new drug application will be filed for MEDI5117, and following that process, Phase I trials will be initiated. 

Sidebar: CROs form public–private partnerships to advance clinical research

Public–private partnerships are increasingly an important piece of the drug-development paradigm. These alliances provide value for CROs in helping to secure patients for clinical research, and the research entity, private or public, in advancing clinical research. Several CROs recently have announced such partnerships.  

In January 2013, Covance formed a five-year exclusive agreement with the Royal Liverpool and Broadgreen University Hospitals NHS Trust for early clinical research. The Royal Liverpool and Broadgreen University Hospitals NHS Trust is one of the largest and busiest hospital trusts in northern England, with an annual budget exceeding £400 million ($631 million). Earlier in 2012, Covance, the French National Institute of Health and Medical Research's (Inserm) subsidiary Inserm Transfert SA, and the seed-investment company Inserm Transfert Initiative formed a multiyear scientific collaboration agreement for R&D. Under terms of the agreement, Covance will conduct discovery and early-development studies, using its capabilities, including those at its facilities in Porcheville, France, and Alnwick, United Kingdom, for projects managed by Inserm Transfert, the knowledge-transfer company of Inserm, and preclinical studies for start-ups within Inserm Transfert Initiative's portfolio. These Inserm Transfert Initiative companies will also gain access to the scientific, operational, and program-management expertise from Covance. 

In September 2012, the CRO -Pharmaceutical Product Development (PPD) and the Global Allergy and Asthma European Network e.V. (GA

 LEN) formed a strategic alliance in which GA

 LEN will provide PPD access to the network's allergy and asthma experts and to more than 100 allergy and asthma sites in Europe. GA

 LEN is a multidisciplinary research network addressing all aspects of allergic diseases with a view to reducing the burden of allergy and asthma.  

 LEN to increase the amount of research it conducts in allergic diseases,as well as provide the network with earlier access to new medical therapies to help accelerate their development. PPD and GA

 LEN will work to reduce allergy and asthma study start-up times, increase the number of patients recruited for clinical trials, and ensure the availability of resources and training to increase the number of physicians and support staff conducting research.  

In early 2012, PPD also formed a alliance with the Scottish government through NHS Research Scotland, part of the United Kingdom's National Health Service (NHS), to increase the amount of clinical research conducted in Scotland. PPD will work closely with the major health boards across Scotland to further reduce study start-up times, streamline regulatory approval processes, increase the number of patients recruited for clinical trials, and ensure the availability of resources and training to increase the number of physicians and support staff conducting research. The initiative covers a broad range of Phase I-III trials across multiple therapeutic areas, as well as biosimilar and post-approval studies.  

Quintiles also formed a strategic partnership in Scotland with four teaching health boards in Aberdeen, Dundee, Edinburgh, and Glasgow as part of its prime site program, which engages researchers and investigators in clinical research. The partnership builds on Quintiles' experience in working with NHS Scotland's four university-based academic research centers in Aberdeen, Dundee, Edinburgh, and Glasgow. As part of the partnership, Quintiles will introduce technology that uses electronic health records to improve health outcomes. 

CROs are keeping pace with the increased globalization of the biopharmaceutical/pharmaceutical industry through a combination of acquisitions, partnerships, and select investments.

CROs in a Global State of Mind

As pharmaceutical companies contend with increased cost pressure and the need to accelerate development timelines, CMOs/CDMOs play a vital role.  The author examines the alliance strategies of contract services providers as a means to build their development and manufacturing capabilities and facilitate more efficient projectmanagement and technology transfer in the outsourced relationship. 

In the arena of pharmaceutical outsourcing, when speaking of partnerships, the discussion typically focuses on the relationship between a pharmaceutical/biopharmaceutical company as the sponsor company and a contract services provider. The emphasis is on the expectations between customer and supplier and the capabilities offered by the contract services provider to the sponsor company and the ways in which the project may be most effectively managed to meet specified deliverables. And while these partnerships remain the key focus of pharmaceutical outsourcing, partnerships among contract services providers, ingredient suppliers, and academia also are becoming a part of the outsourcing paradigm as companies seek to combine capabilities, services, and products to deliver a more integrated and efficient solution to a sponsor company. 

 Jean-Christophe Riou/Radius Images/Getty images			

Formulation development andfinished-product manufacturing

In 2012, several CDMOs and CMOs formed partnerships as a means to expand their offerings. For example, Catalent Pharma Solutions and the CDMO Bend Research partnered to provide integrated solutions for pharmaceutical companies seeking to develop and manufacture specialized multiparticulate oral controlled-release products. The companies offer combined expertise in formulation development, and Catalent provides further capabilities in analytical and chemistry, manufacturing and control (CMC) development, solid-state optimization, and clinical and commercial manufacturing. As part of their agreement, Catalent and Bend Research are developing joint operations and technology-transfer protocols. The partnership is geared toward complex, multiparticulate controlled-release products, which traditionally have presented a high scale-up risk when they are transferred to commercial manufacturing sites. The companies are aligning their scientific expertise and processes to ensure that developments are undertaken using quality-by-design principles (QbD). Bend also brings laboratory-scale modeling expertise that complements Catalent's expertise in formulation development and manufacture of controlled-release compounds. Catalent's Winchester, Kentucky facility is a commercial facility for multiparticulate products. 

Earlier in 2012, Catalent Pharma Solutions and BASF formed a broad collaboration and open alliance to provide solutions to overcome bioavailability challenges of new molecular entities with solubility or permeability challenges (i.e., Biopharmaceutics Classification System Class II and IV compounds). The alliance combines the expertise of both companies to provide feasibility studies across multiple technologies, solid-state chemistry, consulting and training, formulation services, excipients, and optimal dose-form development from scale-up to commercial supply. One specific application for addressing solubility issues is the use of hot-melt extrusion (HME). BASF has a portfolio of solubilizers and excipients for HME, including its Soluplus excipient, and Catalent offers HME technologies (OptiMelt). Catalent has made recent investment in its OptiMelt HME and fluid-bed laboratory- pilot-, and commercial-scale equipment at its Schorndorf, Germany, facility as well as in training and method development at its facility in Somerset, New Jersey.  

On the clinical side, Catalent and the CRO PAREXEL  formed an alliance in October 2012 to provide a fully integrated, end-to-end clinical-trial-material supply-chain solution. This solution is intended to streamline the clinical supply process and reduce development timelines while improving service quality. In the alliance, PAREXEL brings clinical-trial-management services and global clinical logistics capabilities, and Catalent brings manufacturing, packaging, and labeling solutions. 

To build cross-functional expertise, Catalent Pharma Solutions also launched the Catalent Applied Drug Delivery Institute to promote innovation, knowledge-sharing, and collaboration between industry leaders, academic experts, customers, and regulators to enhance understanding of available, emerging, and future drug-delivery technologies. As part of its mission, the Catalent Applied Drug Delivery Institute, which was launched in 2012, will serve as a link between industry and academia by providing guidance, counsel, and resources on major issues pertaining to drug development, drug delivery, and formulation. The institute will develop programs that facilitate mutually beneficial collaborations, increase communication, and shed light on regulatory issues affecting drug developers and researchers. It also will pursue a multitiered approach of seed funding, strategic counsel, and educational programs to advance the adoption of emerging technologies.  

Other companies also are pursuing collaborations. In October 2012, Bend Research and Dow Chemical formed an exclusive collaboration to provide science-based spray-dried dispersion (SDD) solutions and select new polymers for poorly soluble oral drugs. Under the agreement, Dow and Bend Research will work together to provide fully characterized polymers supported by QbD principles as well as  tailor materials to meet the performance needs of specific drugs. In addition, the two companies will develop and commercialize new materials for SDDs that address technology gaps in manufacturability and delivery to provide greater drug-product utility and therapeutic performance. Specifically, Dow will provide the excipients hypromellose and hypromellose acetate succinate as well as cellulosic and noncellulosic polymers.  

The collaboration combines Dow's capabilities in materials design, high-throughput screening, and pilot-plant and commercial scale-up operations with Bend Research's SDD screening, formulation, scale-up, and technology-transfer capabilities. Dow is supporting the collaboration with several technologies, including high-throughput synthesis with API/polymer screening, laboratory-scale product development, and structure/property optimization as well as a cGMP market-development plant capable of supporting clinical development.  

In January 2013, Xceleron, a provider of bioanalytical accelerator mass spectrometry (AMS) services for early drug development, partnered with Crystal Pharmatech, a China-based solid-state research CRO, to offer drug developers early bioavailability data for producing optimized solid-state forms and formulations. The partnership seeks to apply AMS technology and related expertise to address pharmacokinetic uncertainty by providing early clinical and solid-state information to provide better information earlier in drug development about a drug candidate's later-stage readiness. Xceleron applies human microdose and microtracer techniques using ultra-sensitive AMS to investigate the pharmacokinetics and metabolism of developmental drugs in Phase 0, Phase I, and Phase II/III clinical trials. 

Contract API manufacturers and fine-chemical producers also are partnering to expand their collaboration. For example, in 2012, DSM and Almac formed an alliance in biocatalysis. The agreement grants both parties access to their enzyme platform technologies, services, and expertise for the manufacturing of APIs. Almac brings to the table capabilities in enzyme identification, scale-up, and implementation into early-phase projects, and DSM brings capabilities in commercial-scale bioprocesses to enable production from preclinical to commercial-scale manufacturing. This collaboration will also enable Almac to offer its customers a preferred partner for large-scale production. 

In 2012, Carbogen Amcis and ADC Biotechnology formed an alliance to provide customers with development and manufacturing services for antibody drug conjugates (ADCs). ADC Biotechnology is developing a "lock and release" solid-phase immobilization technology for production of ADCs. The alliance will offer services for the development, scale-up, manufacturing, and formulation of protein-based drug conjugates. ADC Biotechnology will provide access to proprietary solid-phase immobilization technologies for conjugation and long-term storage of ADCs, and Carbogen Amcis will focus on focus on small- to large-scale GMP supply and on the formulation of ADCs. 

Onyx Scientific and Molecular Profiles partnered in 2012 to deliver end-to-end services from initial drug discovery to early- and late-phase manufacturing. The complementary alliance involves Onyx Scientific's specialty in API production and initial solid-state screening and Molecular Profiles' expertise in formulation and analytical development and early-phase clinical-trial-material manufacturing. Onyx Scientific also has sites in India, at which it provides late-stage clinical-trial and commercial manufacturing services. 

Alliances with academia also provide an opportunity for a CDMO or CMO to enhance its capabilities. For example, in January 2012, Almac completed its Knowledge Transfer Partnership (KTP) with Queens University, Belfast, to develop, improve, and embed bioprocesses to facilitate the delivery of novel products for its biocatalysis business. The overall aim of the partnership was to allow technology transfer of fermentation and molecular/microbiology expertise from Queens University to Almac. Almac met the specific partnership objectives by sharing a program of work with academics at Queens and by attending training courses organized through University College London, which allowed Almac to embed key learning back into the company. Since completion of the KTP, Almac has successfully scaled fermentation and bio-oxidation reactions to thousands of liters.  

Aesica formed a partnership with the Center for Pharmaceutical Engineering Science at the University of Bradford in the United Kingdom to enable the team at the University of Bradford to use the GMP capabilities and assets held at Aesica while Aesica will benefit from the center's research facilities. The partnership builds upon the relationship between the two parties. The center offers several processing technologies, including HME, but relies on the GMP expertise of the formulation development team at Aesica to manufacture GMP clinical-trial supplies. 

The goal to offer integrated and more seamless delivery of services is also achieved through individual company strategy and focus. For example, in 2012, AMRI launched SMARTSOURCING, an approach that further focuses its research and contract manufacturing services to the various needs of the life-sciences and other industries. It is designed as a series of strategic sourcing options for customers.   

The rationale for the SMARTSOURCING arose in response to changing industry fundamentals, namely increased pressure on pharmaceutical companies to deliver accelerated and increased drug-discovery success with reduced budgets and resources. Moreover, due to downsizing in the United States and Europe, many large pharmaceutical companies have lost experienced scientists with drug-discovery and development expertise, and as a result, may rely more on their contract service providers to fill knowledge gaps. This provides further opportunity for CROs and CMOs to reconsider their current service strategies to find more appropriate ways to meet the market's changing needs. SMARTSOURCING is an approach that seeks to address that by offering insourcing or outsourcing, or a hybrid model of both, to deliver scientific expertise, according to an Apr. 30, 2012, AMRI press release. 

Sidebar: The marriage of contract service providers and biopharmaceutical/pharmaceutical companies

Providing contract-manufacturing services is not in of itself new for bio/pharmaceutical companies, and several companies have well-established contract activities for API development and manufacturing, formulation-development, drug delivery, and finished drug-product manufacturing. In general, these third-party services provide a way for pharmaceutical/biopharmaceutical companies to leverage internal expertise and manufacturing capacity to augment revenues through contract services, and these companies have become an important part of the outsourcing market. 

Some examples of companies positioned in the market this way include: the contract services business of Pfizer (Pfizer CentreSource), Sanofi (Commercial and External Partnership, Industrial Affairs [CePiA]), GlaxoSmithKline, Hospira (One 2 One), Mitsubishi Tanabe Pharma (API Corporation), Bayer (Bayer Healthcare Pharmaceuticals), Boehringer Ingelheim, AbbVie (AbbVie Contract Manufacturing), Baxter International (Baxter BioPharma Solutions), Merck & Co. (MSD API), Sandoz (the generic-drug business of Novartis), Teva Pharmaceutical Industries (Teva Active Pharmaceutical Ingredients [TAPI]), and Mylan. A review of these companies' activities shows capabilities in both API and finished product manufacturing. 

For example, Pfizer CentreSource, headquartered in Kalamazoo, Michigan, is a provider of APIs and dosage-form manufacturing. It is a supplier of fine chemicals, steroid APIs (e.g., corticosteroids and hormonal steroids), and steroid intermediates. It also provides custom fermentation services as well as sterile manufacturing (blow/fill/seal/services) and solid-dosage manufacturing, including high-containment services.  

One 2 One, the contract manufacturing arm of the specialty pharmaceutical company Hospira, provides development services and finished-dose manufacturing of parenteral drugs. One 2 One specializes in fill–finish of biologics and lyophilization and can provide access to leading biopharmaceutical markets by using several manufacturing facilities in the US, Europe, and Asia.  

 AbbVie Contract Manufacturing is the new name for the contract manufacturing activities of AbbVie, following the formation of AbbVie as an separate research-based biopharmaceutical company in January 2013 following the separation of AbbVie from Abbott. AbbVie Contract Manufacturing provides contract manufacturing services for biologics, drug products, and potent compounds.  

The CMO division of Sanofi, CEPiA, provides corticosteroids, steroid diuretics, vitamin ±2, cardiovasculars, analgesics, anti-inflammatories, antihistamines, antibiotics, prostaglandins, and opiods (morphine and codeine salts). The company has expertise in multistep custom synthesis, steroid chemistry, prostaglandins chemistry, enzymatic conversions, synthesis of high-potency compounds, peptide and protein chemistry, micronization, and large-scale chromatography. The contract arm uses Sanofi's chemical, fermentation, and biotechnological facilities in France, Germany, Italy, Hungary, Eastern Europe, Singapore, and India.  

On the API side, Bayer Healthcare Pharmaceuticals uses several plants for its contract activities. Its supply center in Bergkamen, Germany is Bayer Pharma's major facility for the production of intermediates, active ingredients, and bulk pharmaceutical chemicals for steroid hormones through chemical and microbiological synthesis. It also has a micronization plant in Berlin-Charlottenburg, another API plant in Elberfeld, Germany, and a second major chemical facility for hormone and steroid production in Orizaba, Mexico. Also, on the API side, the contract-services arm of Boehringer Ingelheim provides contract manufacturing of biologic-based APIs, chemical APIs, and fine chemicals. On the biologics side, a key offering is its BI Hex high-expression system for monoclonal antibody production. 

Sidebar: The anatomy of a partnership: API development and manufacturing for an orphan drug

FDA approval of a new molecular entity (NME) is a crucial milestone for the commercialization of a drug. Bringing a NME through the drug-development and regulatory-review process to eventual commercialization requires the application of a myriad of capabilities, which may be internally provided by a biopharmaceutical company or externally by a contract services provider. For smaller biopharmaceutical companies, the role of a CDMO and/or CMO is particularly important for advancing a NME, with the partnership between a sponsor company and the CDMO/CMO often beginning early in development and continuing through drug development and commercialization. 

Such was the case for the biopharmaceutical company Aegerion Pharmaceuticals, which received FDA approval in December 2012 for Juxtapid (lomitapide), a small-molecule, microsomal triglyceride transfer protein inhibitor that Aegerion developed as a once-day capsule for treating patients with certain severe lipid disorders, including homozygous familial hypercholesterolemia (HoFH). Aegerion Pharmaceuticals develops drugs for rare diseases, and the orphan drug lomitapide was approved as an adjunct to a low-fat diet and other lipid-lowering treatments, including low-density lipoprotein (LDL) apheresis where available, to reduce low-density lipoprotein cholesterol (LDL-C), total cholesterol (TC), apolipoprotein B (apo B) and non-high-density-lipoprotein cholesterol (non-HDL) in patients with HoFH, according to a Dec. 24, 2012, Aegerion Pharmaceuticals press release. HoFH is a serious, rare genetic disease that impairs the function of the receptor responsible for removing LDL-C (i.e., "bad" cholesterol) from the body. A loss of LDL receptor function results in extreme elevation of blood cholesterol levels, according to the company release. HoFH patients often develop premature and progressive atherosclerosis, a narrowing or blocking of the arteries. 

Catalent Pharma Solutions is providing the finished product for Juxtapid following a seven-year clinical-trial-materials supply relationship with Aegerion. The partnership, which included analytical development, clinical-trial-material supply and manufacturing, will now be expanded with Catalent as the exclusive supplier of Juxtapid in 5-mg, 10-mg, and 20-mg strengths for the US and European markets from Catalent's Kansas City, Missouri facility. Catalent will also support Juxtapid packaging and qualified-person release from Catalent facilities in Bolton and Swindon, United Kingdom, for the European market.  

On the API side, in January 2013, Aptuit signed a long-term supply agreement with Aegerion Pharmaceuticals for commercial quantities of the API lomitapide. Aptuit provides integrated early- to mid-phase development services, including drug design and discovery, preclinical biosciences, API development and manufacture, solid-state chemistry, drug-product formulation development and manufacture, sterile fill–finish, clinical sciences, and consulting. The company maintains five global facilities with approximately 800 employees in Europe and the United States and has a strategic relationship with Laurus Labs in India. 

To gain a perspective on this partnership and overall trends in outsourcing, Patricia Van Arnum, executive editor of 

, recently spoke to Kevin Duffield, senior director, API, at Aptuit.  

 Aptuit and Aegerion Pharmaceuticals recently signed a long-term supply agreement for commercial quantities of the API lomitapide, a newly approved drug. Can you provide some background on the partnership with the company? Was Aptuit also involved with clinical supply of the drug and how did the relationship begin?  

The companies began working in 2007 to support early clinical trials with API and drug product. Aptuit had made the API to support clinical trials and product launch and will continue to supply over the coming years.  

  Can you explain how the integration of various service deliverables occurred across the company's US and European sites and with the sponsor company? What were the critical success factors in terms of project management and communication?  

Aegerion's approval for lomitapide provides a new treatment for an orphan indication with few alternatives. The ability to rapidly develop the API process, analytical methods, and solid-state formulation was critical to meeting the aggressive commercialization timeline of Aegerion. During the development cycle, many overlapping project activities were conducted to speed the process to the new drug application filing. For instance, three different Aptuit R&D sites worked on process-justification studies. A large number of analytical methods needed to be developed and validated. This work was spread across Aptuit sites to conduct the work in parallel and to take advantages of a larger network of expertise.  

Another critical factor was the ability to identify and resolve solid-state chemistry issues and to rapidly translate fundamental science in this area to plant-scale control of API morphology and particle size. Aptuit's West Lafayette, Indiana  team are leaders in this science and worked hand-in-hand with the Aegerion and Aptuit's Harrisonville, Missouri production unit to scale up and validate the process. 

 Can you provide further insight  in the synthesis of lomitapide to understand the context of the services delivered? 

 The synthesis is a multistep convergent synthesis that requires several weeks to complete. Services delivered included raw-materials sourcing, auditing, and qualification. More than 20 quality-control methods for raw materials, intermediates, and final product were developed and validated. Basic R&D into the chemical process was conducted at Aptuit, along with the process-justification design-of-experiment  work to establish a foundation for the critical process parameters. Solid form and particle-size control technology was developed and implemented at plant scale. A prospective process-validation campaign, during a multimonth timeframe, was completed. All services were conducted under cGMP-compliant practices and a pre-approval inspection was successfully completed with all appropriate documents to support filings with FDA. Overall, five Aptuit sites contributed to the successful activity with the bulk of the work being done in 2011 and 2012. 

 On an industry level, how is the outsourcing model evolving between contract service providers and sponsor companies? What factors have shaped relationships during the past five years, and what do you see the future holding?  

 To bring potent/orphan compounds to market in the shortest possible time requires collaborations that rely on incredibly open communication, trust, and responsiveness to changing needs and circumstances. Mutual resource commitments and dedicated people working in collaboration to solve problems on short timescales are essential to drive parallel activity and to manage the risks that go with accelerated timing. The supplier has to provide compliant science with exceptional commitment to service and a will to win on behalf of the sponsor and its  prospective patients. The sponsor has to provide open communication of goals and recognition of the efforts of the supplier to meet their goals (both verbal and financial). Flexibility and speed to response, along with broad technical capability, are driving the business and will continue to be the difference maker between suppliers in the coming years. 

Sidebar: An emerging model: manufacturing-capacity sharing arrangements

Achieving a good return on assets through manufacturing-capacity utilization is an ongoing challenge for biopharmaceutical/pharmaceutical companies. Pharmaceutical companies need manufacturing capacity on hand to produce commercial products and also to launch new products as they come through their drug-development pipelines. The inherent uncertainty of drug development, however, makes it difficult to balance the need for timely access to manufacturing capacity with the interest of avoiding underutilizing capacity and a resulting reduction on a return on assets. One strategy taken by some companies has been to enter manufacturing capacity-sharing agreements, which allows one partner to monetize underutilized capacity and another partner to secure access to manufacturing capacity. 

In December 2012, Biogen Idec and Eisai formed such a strategic alliance to strengthen the manufacturing capabilities of both companies' facilities in Research Triangle Park (RTP), North Carolina. Under the terms of the agreement, Biogen Idec will lease a portion of the Eisai facility to manufacture oral solid dose products for both companies. Eisai will provide Biogen Idec with vial-filling services for biologic therapies and packaging services for oral solid-dose products. The 10-year lease agreement gives Biogen Idec the option to purchase the Eisai oral solid-dose facility.  

Approximately 50 Eisai personnel are expected to become Biogen Idec employees in early 2013, building on the company's RTP workforce, which exceeded 1000 in 2012. Eisai currently employs approximately 225 full-time employees at its RTP site. Biogen Idec and Eisai have both operated manufacturing facilities in RTP since the mid-1990s.  

Merck & Co. and MedImmune, the biologics arm of AstraZeneca, also have a capacity-sharing arrangement in biologics, an arrangement the companies formed in September 2011. The relationship emerged to address underutilized capacity on behalf of MedImmune and a need for Merck to secure biologics capacity for its biologics program.  

In the arena of pharmaceutical outsourcing, when speaking of partnerships, the discussion typically focuses on the relationship between a pharmaceutical/biopharmaceutical company as the sponsor company and a contract-service provider.

Seeking Strength in Partnership Strategies

Sidebar 1: The marriage of contract service providers and biopharmaceutical/pharmaceutical companies

Sidebar 2: The anatomy of a partnership: API development and manufacturing for an orphan drug

Sidebar 3: An emerging model: manufacturing-capacity sharing arrangements

When speaking of partnerships, the discussion typically focuses on the relationship between a pharmaceutical/biopharmaceutical company as the sponsor company and a contract-service provider.

Building Toolboxes through Cross-Functional Partnerships

As the biopharmaceutical industry enters another year, a review of financing trends in the industry shows both positive and negative signs. On the plus side, overall financing (public and private) for life-science companies was up on a global level and in the United States. Venture-capital funding remained strong, but money raised from initial public offerings (IPOs) was down, and mergers & acquisitions (M&A) activity was also down on a value basis. 


 US life-sciences companies raised a record amount of capital in 2012 with a total of $71.1 billion in public and private financings, up from $57.4 billion in 2011, a 23.9% increase, according to a recent analysis by Burrill & Company. When the potential value of partnering transactions are included in the numbers, the total for 2012 was $91.7 billion, a 13.9% increase over the $80.4 billion raised through financings and partnering transactions in 2011.

Global life-sciences venture financings totaled more than $12.4 billion in 2012, an increase of nearly 23% compared with 2011, and US-based venture-capital funding increased nearly 22% to approximately $9.5 billion. Venture investors, however, are moving away from early-stage financings, according to the Burrill & Company analysis. Companies are relying more on alternative sources of financing, including accelerators, angel capital, corporate-venture sources, and private equity investment. Of the top 10 private financings in 2012, all but one had significant backing from private-equity firms or strategic investors, according to the Burrill & Company analysis. Although privately held therapeutics developers had the largest portion of funding with a total of $5.1 billion in 2012, digital health and life-sciences information technology deals showed the largest increase in activity, with a 58.5 % increase to $748 million.

A total of 16 life-sciences companies completed IPOs in the United States in 2012, the same numbers as in 2011. Although the numbers of IPOs were on par, the money earned from them fell by 16% in aggregate in 2012. In 2012, the 16 IPOs in the US raised nearly $1.1 billion, down from the nearly $1.4 billion raised in 2011. Global IPOs were also down in both number and value. In 2012, there were 37 IPOs that raised $2.1 billion compared with 45 IPOs in 2011 that raised $3.8 billion, according to the Burrill & Company analysis.

Global and US-based M&A also was down in 2012 compared with 2011. On a global basis, companies in 2012 announced a total of $109.2 billion in M&A transactions, down 31.2% in 2011, according to the Burrill & Company analysis. Big Pharma and Big Biotech continue to be the most active acquirers. Although generic drugs and consumer health were large areas of activity, the top deals involving innovative biopharmaceuticals in 2012 included Bristol-Myers Squibb’s $7-billion acquisition of Amylin Pharmaceuticals, GlaxoSmithKline’s $3-billion purchase of Human Genome Sciences, and Dainippon Sumitomo Pharma’s $2.6-acquisition of Boston Biomedical, which is developing drugs to target cancer stem cells.


For the life sciences in 2013, Burrill & Company expects that an improving world economy, tempered by economic instability in Europe, fiscal uncertainty in the US, and political unrest in the Middle East. On the life-sciences front, the firm expects the industry to raise $100 billion in capital, with financings heavily weighted to the large companies and to the use of debt. In private financing, it projects that traditional venture investors will become less relevant to start-ups as they continue to migrate not only toward later-stage deals, but public-company investments as well. Angel, corporate venture, disease advocacy groups, and philanthropic organizations will fill the growing gap. Marketability or evidence of market potential will continue to be an important criterion to secure funding. With growing wealth in emerging markets, Burrill projects that investors in these parts of the world will become more prominent and new cultures of entrepreneurship will give rise to a growing number of life-sciences startups outside the United States. Burrill projects that private financings to grow 20% in 2013.

Helped by increased public-market activity and jobs stimulation on a US federal level, Burrill expects the number of life sciences IPOs to increase to 25 in 2013. On the M&A front, the firm projects that M&S will increase by at least 20% with a pick-up in acquisitions of mid-cap life-sciences companies and at least one Big Pharma or major biotech merger in 2013. Deals targeting drug companies that reach into Latin America, the Middle East, and Southeast Asia, will also drive activity, according to the Burrill & Company analysis.

Financing from initial public offerings and global mergers and acquisitions were down in 2012 and venture-capital funding stayed strong.