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Pharma/fine chemicals roundup—28 January 2014
3:47 AM MST | January 28, 2014 | By DEEPTI RAMESH
Informex 2014: Rising certainty despite challenges for pharma
Attendees and exhibitors at this year's Informex USA, held last week in Miami Beach, were mostly optimistic about the direction of the fine chemicals and contract manufacturing industries, as the economic situation improves and some sector-specific drivers have turned in the industry's favor. “The mood is definitely more upbeat [compared to last year's show],” says Lawrence Sloan, president and CEO of Socma. “I think people finally feel like we are leaving the Great Recession behind. It's been a long, slow crawl.”
The pharmaceutical sector faces some challenges – particularly a number of drugs coming off patents – that can have a mixed impact on the fine chemicals sector. Pharma companies are increasingly turning to biologic drugs to fill their pipelines, and many generic drugs will operate more like commodities, attendees say. However, the drugs still need to be produced, and many contract active pharmaceutical ingredient (API) makers do business in generics. Albemarle, for example, makes lower-volume generics such as cancer drugs, but does not compete in high-volume generics like over-the-counter painkillers. Some other companies, such as catalysts makers Codexis and Johnson Matthey, say that the switch to generics will not impact their business, as generic drug production still requires catalysis. The improvement in economic certainty also means that early stage pharma firms, which are often venture-capital-backed, have more funds for drug development than they did in recent years. “A larger amount of investment from venture capital is coming back into biotech and drug development,” says Kurt Hoeprich, global business manager/fine chemistry services at Albemarle. Such early-stage pharma firms are likely to use contract manufacturers to make drugs, as venture firms generally do not want to invest in costly manufacturing facilities.
Lonza reports fall in profits, sales
Lonza recorded a 44.2% fall in profits for 2013 compared with 2012, to 87 million Swiss francs ($95.7 million). Sales for 2013 decreased by 4.2%, to SF3.58 billion, due to lower sales in the water treatment business; product portfolio optimization measures; unfavorable exchange rate translation effects; weaker pharma and biotech sales in the first half of the year; and the previously announced phase down of the company’s microbial biologics plant at Hopkinton, MA, Lonza says. Core Ebit for 2013 increased by 11.2%, however, to SF436 million. In line with the previously announced restructuring program, Lonza cut 854 jobs in 2013, and as a result total headcount was reduced by 7.9% to 9935, Lonza says. Capital expenditure in 2013 was SF210 million, down from SF310 million in 2012. The previously announced carve-out process of the company’s wood protection business began on 1 January 2014, and all strategic options for the future development of this business will be evaluated, Lonza says.
Informex 2014: TSCA, trade top Socma’s regulatory agenda
Reform of the Toxic Substances Control Act (TSCA) along with trade-related issues top the regulatory concerns for Socma this year, officials said at the Informex trade show, which ran 21–24 January at Miami. Socma’s priority for 2014 is the passage of TSCA reform, says president and CEO Lawrence Sloan. “We are optimistic that there is going to be traction [in the Senate] on TSCA,” Sloan tells CW. “We think the bill is going to get out of committee and go to the floor.”
Sloan gives it a “50-50 chance” that TSCA reform is passed by Congress by late August. If a bill is not passed by then, November’s midterm elections mean that passage will likely have to wait until the next Congress convenes in January 2015. “If we don’t see anything by late summer, it’s not going to happen,” Sloan says.
Issues related to international trade are also important for Socma in 2014. The organization has been involved in the ongoing US-EU trade negotiations, which, if finalized, would be the largest free trade agreement in history. A deal is currently expected by the end of 2015, but Sloan thinks there is a good chance it will take longer. “We’d love to say that something will be in place by then, but I wouldn’t bet on it,” Sloan says. “However, I think this has a much better chance of coming into place than the Doha round.” The Doha round of global trade talks were launched in 2001, stalled in 2008, and have not restarted.
FDA prohibits Ranbaxy API plant from producing and distributing products for US market
The US Food and Drug Administration (FDA) announced on 23 January that it has notified Ranbaxy Laboratories (Gurgaon, India), that it is prohibited from manufacturing and distributing active pharmaceutical ingredients (APIs) from its facility at Toansa, India, for FDA-regulated drug products. The Toansa facility is now subject to certain terms of a consent decree of permanent injunction entered against Ranbaxy in January 2012.
The decree contains provisions to ensure compliance with current good manufacturing practice (cGMP) requirements at Ranbaxy facilities at Paonta Sahib and Dewas, India, as well as provisions to address data integrity issues at those facilities. The FDA, in September 2013, added Ranbaxy’s Mohali facility to the cGMP provisions of the decree.
Under the decree, the FDA has issued an order prohibiting Ranbaxy from distributing in the United States drugs manufactured using API from Toansa, including drugs made by Ranbaxy’s Ohm Laboratories facility at New Brunswick, NJ; manufacturing API at its Toansa facility for FDA-regulated drug products; exporting API from Toansa to the United States for any purpose; and providing API from Toansa to other companies, including other Ranbaxy facilities, making products for American consumers.
Merged Cambridge Major and AAIPharma appoint head of quality control
Cambridge Major Laboratories (CML; Germantown, WI), a producer of pharmaceutical intermediates and active pharmaceutical ingredients (APIs); and AAIPharma Services (Wilmington, NC), a provider of contract services that support all phases of drug development, say that they have appointed Jeff Yuen as executive v.p./global quality. CML and AAIPharma, in October 2013, announced their plans to merge. The merged company is a portfolio company of private equity firm American Capital (Bethesda, MD).
“Jeff has nearly thirty years of experience and is widely recognized as an expert in good manufacturing practices [GMP] and compliance in the pharmaceutical industry. His breadth of knowledge in the areas of active pharmaceutical ingredients, sterile drug manufacturing and biotechnology products aligns perfectly with our company’s key service offerings,” says Patrick Walsh, CEO of the merged company.
Yuen has served as food and drug investigator at the State of California, Department of Health Services, food and drug branch; several roles at the US Food and Drug Administration (FDA) where he was promoted to the rank of commander in the US Public Health Service; and GMP auditor, GMP advisor or FDA advisory committee member at the Natural Products Association.