Global Information Inc. would like to present a new market research report, "Biopharmaceutical Manufacturing in India, China and South Korea - Regulatory Framework, Infrastructure Support and Discovery Funding Create an Environment Conducive to Growth" by GBI Research.
The annual revenue for biopharmaceuticals has been consistently growing since 2001, accounting for 15.6% of the total pharmaceutical market in 2011. The global biopharmaceutical market was valued at $138 billion in 2011 and is expected to grow to over $320 billion by 2020. By 2014, biosimilars are expected to enter the US market, and GBI Research estimates that they have significant potential for growth in the biopharmaceutical sector, reaching $9 billion by 2020.
GBI Research believes that the next decade will bring about a paradigm shift in biomanufacturing technologies, with improvements in equipment efficiency and the introduction of novel therapies. In pharmerging countries such as India, China and South Korea, the emergence of biosimilars is seen as a key macroeconomic factor for generating revenues by attracting Foreign Direct Investment (FDI) in the start-up of manufacturing units. Efficient manufacturing processes and equipment will reduce production costs, provide economic benefits and decrease healthcare expenditure. The US has the most advanced R&D in biopharmaceutical manufacturing, and most biopharmaceuticals are licensed first in the US. The approval of biopharmaceuticals has contributed significantly to the US economy and has saved many from life-threatening diseases.
Single-Use Bioprocessing and Microbial Technologies to Dominate Biopharmaceutical Manufacturing
Pharmaceutical companies, in the process of standardizing production technology, are installing single use bioprocessing gears at manufacturing locations. Biopharmaceutical manufacturers are increasingly shifting their focus to disposable bioprocessing equipment, which is mostly used in upstream manufacturing. The adoption of this equipment is in the initial stages, and GBI Research expects robust growth potential in the foreseeable future. This equipment is also finding application in preclinical and clinical trials.
Microbial manufacturing technology is relatively more acceptable and well proven. It has been under continuous development, and has led to the discovery of new subsidiary technologies. Recombinant proteins produced by mammalian cell culture processes are gaining significant traction by the pharmaceutical players, and biopharmaceuticals from these proteins have been successful in generating revenues of more than $1 billion. GBI Research believes these two technologies are the hallmark of biopharmaceutical manufacturing and are set to further advance the manufacturing process.
Biosimilars in Asia
Emerging economies, such as India and China, have developed regulatory approval guidelines which are relatively less stringent than their western counterparts. Lenient regulations and tax incentives during the initial industrial phase attracted industry players to operate in the region. For example, major supporters of the biopharmaceutical industry in India, such as Biocon and Dr Reddys Laboratories; and China-based companies, such as Hualan Biological Engineering and Shanghai Kehua Bio-Engineering, are planning large-scale product distribution strategies in western countries. Biosimilars of some of the biologics that are currently under exclusivity in western countries, such as Enbrel and Rituxan, are sold in developing countries.
The South Korean government has announced capital and institutional support to boost biopharmaceutical manufacturing, and has set an ambitious target of acquiring a 22% global biosimilars market share by 2020. The Samsung Corporation, which operates in the electronics industry, has ventured into the biosimilar industry, and plans to invest over $2 billion before 2020. It has entered into a partnership with the Quintiles Corporation, and the joint venture will be functional by 2013. It will initially manufacture biopharmaceuticals on a contract basis, and plans to launch biosimilar versions of Humira, Enbrel and Remicade after their patents expire in 2016. Similarly, an Indian company called Cipla invested $65m in the biotech company MabPharm to build biologic-manufacturing facilities. The Chinese company AutekBio has stayed one step ahead of its competitors by securing the FDA and European Medical Agency (EMA) certifications needed to produce biopharmaceuticals.
Nine Companies Account for 79% of Global Biopharmaceutical Production
The new biological entity market is estimated to grow at a rate of 7% until 2015. Globally, 79% of biopharmaceutical production is under the management of nine companies, and more than 60% of this share is produced from manufacturing plants located in the US. However, as demand is projected to escalate in Asian economies, companies are expanding their manufacturing capacities, or strategically investing in these economies, to manufacture biopharmaceuticals.
Roche is the global leader in biopharmaceutical manufacturing, with 25% of the global biologic production capacity. Roches manufacturing network comprises 19 sites, of which five sites are in Asia, with three in Japan and one each in Singapore and China. Roche produces some of the top blockbuster biologics, such as Rituxan, Avastin and Herceptin, with combined sales of $19.5 billion in 2011.
Johnson & Johnson has the second largest biologic production capacity, and it is making concerted efforts to enhance the quality of the manufacturing systems at its other sites. To expand its production base, it acquired Crucell NV, a biopharmaceutical company focused on the R&D and production of vaccines and antibodies, in 2011.
Boehringer Ingelheim, in an attempt to increase its presence in emerging economies, announced in 2009 its plan to invest $120m in a phased manner, over a period of several years, in Asia. In 2010, the company invested $13.2m in building the Center of Competence in Shanghai, which specializes in the quality control of pharmaceutical raw ingredients procured in China. In 2011, it decided to expand the production site at Zhangjiang Hi-tech Park in Shanghai with an investment of $94.8m. The company has manufacturing sites in Biberach, Germany, Vienna and Austria; in addition to this, the company purchased a production site in California from Amgen, and integrated it within the existing production network in 2011.
In order to optimize manufacturing operations, Amgen has started multiple initiatives, including the construction of new formulation and fill facilities and the expansion of the bulk protein facilities at their Puerto Rico site, and the expansion of their newly acquired formulation, fill-and-finish sites in Ireland.
Lonza has 12 manufacturing sites spanning three continents, with the majority of its manufacturing capacity established in the US. In Asia, it has facilities in Singapore and China. In GBI Researchs view, the South Korea-based company Celltrion is a strong contender for a place in the top nine companies by 2017. Its existing mammalian cell culture and purification capacity is 50,000 liters, and the company is planning to incorporate an additional 90,000 liters in 2012.