Nice Insight Highlights Key Trends Driving Growth in the Biopharmaceutical Market
The global biopharmaceuticals market was valued at $162 billion in 2014 and predicted by Persistence Market Research to grow at a compound annual growth rate of 9.4% from 2014 to 2020 to reach $278 billion.1 This healthy growth rate is attributed to the increasing prevalence of chronic diseases, for which biologic drugs are more effective than traditional small-molecule treatments, the aging of the global population, and increased investment in R&D technological advances, particularly in the area of targeted and personalized therapies.
However, intense pressure to reduce the costs of these very expensive drugs and rapid expansion of biosimilar sales is acting to restrain even greater market growth. The industry is responding with the installation of state-of-the-art flexible, small-volume manufacturing capabilities based on single-use systems, and exploring continuous processing technologies in modular facilities, which can be readily replicated anywhere in the world. Increased outsourcing to leverage unique expertise as well as lower-cost development and production capacity remains a key strategy for many small-to-large companies involved in biopharmaceutical manufacturing.
Part of this strong growth is also due to globalization of the biopharmaceutical industry. There is significant investment in the expansion of existing, and the addition of new capacity in many emerging markets. This growth is occurring despite significant challenges. According to the Pharmaceutical Research and Manufacturers of America (PhRMA), it takes more than 10 years to receive regulatory approval at an average cost of $2.6 billion, double the cost from 10 years ago. This also reflects the fact that just 12% of investigative medicines that enter Phase I clinical trials end up as commercial products.2 It is also worth noting that constructing conventional, large-scale biopharmaceutical manufacturing facilities typically costs $200 to $500 million (vs. $30 to $100 million for similar-scale, small-molecule plants) and takes approximately four to five years to complete.3 Indeed, BioPlan Associates reported that bioprocessing-related budgets were higher in 2015 than the previous year across all areas, including capacity expansion, equipment expenditures, process design, new personnel hiring and facility construction.4
Monoclonal antibodies (mAbs) remain the largest class of biopharmaceuticals with sales of ~$50 billion in 2014, and account for ~90% of global mammalian cell-culture capacity.4Introduction of mAb biosimilars is also anticipated to drive strong growth in the biosimilar sector.5 Even so, as our understanding of disease mechanisms increases, numerous next-generation therapies are being developedthat will require significant advances in biomanufacturing technologies. For instance, antibody-drug conjugates (ADCs) and therapeutic vaccines are taking cancer treatment to new levels. According to PhRMA, there have been three ADCs approved to date, with 24 in clinical trials. In addition to Provenge, the therapeutic vaccine approved in 2010 for prostate cancer,13, 14 other cancer immunotherapy drugs are in clinical trials.2 In early 2016, Immunomedics’ investigational ADC, Sacituzumab govitecan, for the treatment of triple-negative breast cancer, was awarded breakthrough therapy designation by the FDA.6 Notably, of the 2016 Nice Insight CDMO Outsourcing Survey7 respondents that have biologic drugs in their pipelines, 57% are developing ADCs and 56% are developing vaccines, compared to 51% with mAbs under evaluation.
In addition to ADCs, numerous gene and cell-based (e.g., chimeric antigen receptor T-cell (CAR-T)) therapies are progressing through clinical trials. Alternatives to Chinese hamster ovary (CHO) cells for recombinant protein expression, such as duck embryo quail sarcoma and chick embryo fibroblasts, have the potential to be more productive and specific. Baculoviral insect cell systems have also been shown to be suitable for large-scale production of mAbs.8 Transient transfection (introduction of genetic information through pores in cell membranes) has allowed for large-scale production of recombinant proteins, prior to degradation of the genetic material.8
Several mega-trends continue to impact the growth and structure of the biopharmaceutical industry.
Behind The Scenes In 2016
Several mega-trends continue to impact the growth and structure of the biopharmaceutical industry. The diseases being addressed by biologic drugs are of increasing complexity, making the development of successful therapies more challenging. At the same time, governments and payers are seeking justification for high drug costs ($50,000 to $100,000 annually for some biopharma products) and placing ever-growing pressure to reduce prices.2
Merger and acquisition (M&A) activity continues at a heightened pace in the bio / pharma industry, but fewer mega-deals are expected. According to Deloitte, the greater prevalence of complex medicines and increased therapeutic competition are just two of four overarching commercial trends impacting biopharmaceutical manufacturing. The other two include the growth of orphan drugs (FDA designations up from 131 in 2004 to over 250 in 2013) and the emergence of personalized medicine.9 Both orphan drugs and personalized medicine result in the development of smaller-volume products and create a need for flexible, multi-product manufacturing capabilities for efficient use of labor and equipment.
All of these trends are driving the need for increased manufacturing efficiency and productivity. In fact, dramatic increases in cell-culture titers over the last decade have led to bottlenecks in downstream processing. Recent indicators suggest, however, that downstream productivity is also improving and, that while chromatography columns still represent capacity constraints, concerns are abating.3 The adoption of single-use technologies, continuous processes monitored using process analytical technology (PAT) and the installation of smaller, replicable modular facilities that can be constructed in a fraction of the time, and at a much lower cost than conventional, permanent plants are, according to PhRMA, driving manufacturing flexibility and scalability while improving quality and efficiency.2
Single-use technologies are already widely used for process development and clinical-scale manufacturing, and are increasingly employed in newer flexible manufacturing facilities. As titers have increased, needed reactor volumes have decreased, enabling the use of disposable technologies for commercial production. When compared to traditional stainless-steel equipment, single-use technologies have been shown to reduce capital and operating costs by 40%-50% and 20%-30%, respectively, and time-to-build by 30%.7
While end-to-end continuous processes are still a ways off, advances are being made in both upstream (high-density /intensified and hollow-fiber perfusion) and downstream (continuous chromatography, in-line concentration, tangential flow filtration, etc.). The FDA notably encourages the adoption of continuous manufacturing.10,11
Modular and flexible manufacturing systems, meanwhile, are seen by many as providing a way for biopharma manufacturers to standardize manufacturing across multiple sites, achieve in-country manufacturing more rapidly and ensure efficient operation of multi-product facilities at lower costs, while maintaining high protection against cross-contamination. Components such as processing equipment, control systems, cleanrooms and HVAC systems are produced as separate modules and shipped to the site of construction. Autonomous modular facilities designed to include HVAC and other utilities help ensure true flexibility, as they do not need to be constructed within an existing structure to gain access to these systems. Recently, a pre-fabricated KUBio plant manufactured by GE Healthcare Life Sciences for JHL Biotech was assembled from 62 containers in Wuhan, China, in 11 days. According to GE, the cost of a KUBio plant can be as much as 45% lower than a comparable, traditional facility.12
With a robust clinical pipeline, expectations of 10 to 15 new biologic drug products receiving approval each year and greater numbers of biosimilars reaching the market3, the outlook for the biopharmaceutical market is bright. Pressures to reduce costs and be quicker to market with innovative, targeted therapies are, however, driving significant change in the manufacturing strategies of biopharma manufacturers. Companies that move swiftly to adopt modular facilities, single-use technologies and continuous processing are likely to be the biggest winners.
- Persistence Market Research. “Global Market Study on Biopharmaceuticals: Asia to Witness Highest Growth by 2020.” Press release. Jul 27, 2015.http://www.persistencemarketresearch.com/mediarelease/biopharmaceutical-market.asp.
- Pharmaceutical Research and Manufacturers of America (PhRMA). “2015 Biopharmaceutical Research Industry Profile.”http://www.phrma.org/sites/default/files/pdf/2015_phrma_profile.pdf.
- Otto, R., Santagostino, A., and Schrader, U.,“Rapid growth in biopharma: Challenges and opportunities.”
- BioPlan Associates Inc. “Top 15 Trends in Biopharmaceutical Manufacturing.” Contract Pharma. Sep 11, 2015.
- Challener, C.,“Monoclonal Antibodies Key to Unlocking the Biosimilars Market.” BioPharm International. Apr 01, 2014. http://www.biopharminternational.com/monoclonal-antibodies-key-unlocking-biosimilars-market.
- European Society For Medical Oncology (ESMO). “FDA Grants Breakthrough Therapy Designation for Sacituzumab Govitecan for the Treatment of TNBC.” Feb 11, 2016.http://www.esmo.org/Oncology-News/FDA-Grants-Breakthrough-Therapy-Designation-for-Sacituzumab-Govitecan-for-the-Treatment-of-TNBC.
- That’s Nice. The 2016 Nice Insight Contract Development & Manufacturing Survey. Jan 2016.
- Hernandez, R.,“Top Trends in Biopharmaceutical Manufacturing: 2015.” Pharmaceutical Technology, Volume 39, Issue 6. Jun 02, 2015.
- Deloitte. “Advanced Biopharmaceutical Manufacturing: An Evolution Underway.” 2015.https://www2.deloitte.com/content/dam/Deloitte/us/Documents/life-sciences-health-care/us-lshc-advanced-biopharmaceutical-manufacturing-white-paper-051515.pdf.
- Rockoff, J.D., “Drug Making Breaks Away From Its Old Ways.” The Wall Street Journal. Feb 08, 2015. www.wsj.com/articles/drug-making-breaks-away-from-its-old-ways-1423444049.
- Wechsler, J., “Congress Encourages Modern Drug Manufacturing.” Pharmaceutical Technology website. May 01, 2015. www.pharmtech.com/congress-encourages-modern-drug-manufacturing.
- Fierce Pharma Manufacturing. “First prefab biologics plant goes up in China in 11 days.” Nov 03, 2015. http://www.fiercepharmamanufacturing.com/story/first-prefab-biologics-plant-goes-china-11-days/2015-11-03
- Snowden, R. V., “FDA Approves Prostate Cancer Vaccine.” Cancer.org. Apr 29, 2010.http://www.cancer.org/cancer/news/fda-approves-prostate-cancer-vaccine.