A Different Perspective On The Current C&G Manufacturing Capacity Constraints

By Anna Rose Welch, Editorial & Community Director, Advancing RNA

If you talk to anyone today about the decision behind constructing their own manufacturing facility, you’re likely to run into one of two big reasons spurring companies to make the investment in their own manufacturing footprint.

The first, of course, is keeping the expertise (a.k.a. the secret sauce) of making these scientifically evolving therapies in-house. (Knowing how to successfully “talk to and negotiate” with your cells is essential; they can be quite personable.)

The second most commonly cited reason is the competitive demand for CDMO capacity. You can’t open an article these days without hearing about the capacity constraints plaguing the cell and gene space. Part of this crunch is attributed to the COVID-19 vaccine and antibody development push. But each day that passes, more biotechs jump into the C&G therapy ring. In many cases, they’re looking to build their operations from the ground up with the help of suppliers and CDMOs.

As limited as CDMO time and space may feel today, we certainly can’t say CDMOs aren’t taking some impressive leaps to make up for any gaps in manufacturing capacity. Over the past few months the news has boasted headlines about facility and company acquisitions that would enable CDMOs to expand — among many other areas — their plasmid and/or vector manufacturing capabilities. In fact, there has been so much movement over the past few months/year, that the question begs to be asked: will we find ourselves on the flip side of that equation with more supply than may ultimately be necessary? A conversation I had recently provided an intriguing perspective into the matter.

A few weeks ago, Mark Davis, principle and founder of NegotiumBio, and I sat down to discuss the current outsourcing landscape for cell and gene therapies. This resulted in a two-part article highlighting the ongoing movement within the cell and gene supplier/outsourcing market and best practices for innovators navigating these partnerships today. But you can bet discussion turned to how he envisions the current rush to build capacity shaking out in the long-term, as well.

“I’ve heard the narrative about this capacity constraint over the past few years, but at the same time, we can’t ignore the amount of money being put into expanding facilities and new technical equipment offerings,” he shared. Davis, who helps C&G companies manage their supplier/CDMO relationships, has seen great willingness from the vendor space to engage and partner with C&G innovators. “There is likely more demand than supply in the current market, which COVID has only accentuated,” he continued. “However, I don’t consider this to be a crisis for the industry as it is often portrayed.”

In fact, as he went on to point out, things have changed pretty dramatically over the past few years as C&G therapies have gained their footing in companies both big and small. At the beginning of the market circa 2014-2015, there was great reliance on CDMOs to establish drug product and vector manufacturing as companies explored proof-of-concept (and with a much smaller supplier network, too). But in recent years, many of the Big Pharma players that jumped into the C&G space have launched or announced their intent to construct their own facilities — think Novartis, Biogen, Pfizer, and BMS (in the US and now in Europe), just to name a few. Some companies, like Bayer, have bought CDMOs (in this case Asklepios/AskBio) for their C&G capabilities and CDMO services. Just recently, in fact, Bayer just announced a huge investment in its Berkley campus to expand capabilities.

As Davis covered in our previous articles (here and here), small biotechs entering this industry can face great competition for CDMO capacity, especially from companies that have deeper pockets and long-term relationships with established vendors. However, with more of the bigger players planning to bring C&G therapy capabilities in-house, the question shifts to whether these larger pharma players will be as much of a competitor to CDMO capacity in the future.

“There are a number of leading vendors building massive new facilities in the U.S. today, but I don’t see Big Pharma filling that capacity in the future,” Davis elaborated. “Between these CDMO capacity expansions and Big Pharma’s current investments in facilities, I actually think we’ll see a flip in the current capacity crunch narrative: supply will end up overshadowing demand.”

He also called attention to the ongoing work within the industry to innovate and move beyond current and traditional viral vector technology. (If you’re interested, this is a great article analyzing the viral vector landscape today, including non-viral and next-gen vector efforts.)

While HEK-293 cell lines and (tons of) plasmids are at the top of C&G manufacturers’ list of demands today, he pointed specifically to efforts to create stable producer cell lines that are anticipated to become the future of large-scale vector development. Given that these next-gen cell lines won’t require plasmids, Davis explained, this puts a lot of plasmid-producing vendors in an interesting position; they have to both scale-up for current demand while also make bets on emerging technologies to ensure they’re future proofing their business model and technical capabilities. The successful scale-up and use of mRNA and lipid nanoparticles in the COVID-19 vaccinations are other areas Davis anticipates could disrupt demand for traditional vector technical capabilities moving forward.

It goes without saying that this is a quickly advancing space, which requires drug makers and vendors to grow comfortable with the notion that everything will be in flux for quite some time. Ultimately, we may find that solving the problems today will require investments that, with greater industry innovations over time, will be rendered obsolete.

But on the flip side, I’d argue this is what we as an industry should ultimately be hoping for: scientific and technological progress both in-house and in the supplier industry. We can only hope that some of the burgeoning innovations today become more commonplace so that the challenges concerning us right now become the topic of our future “Remember when we had to deal with …” conversations. (Ironically, Davis admits he’s already experienced a few of those “remember when” conversations…)