Lonza gets hammered by Celltrion activities

27 June 2005 00:01  [Source: ICB Americas]

Shares of Lonza were off by 5 percent last week on news that rival contract manufacturer South Korea-based Celltrion has inked a long-term deal with Bristol-Myers Squibb.

Celltrion, a newcomer to the biopharmaceuticals manufacturing arena, will take on bulk production of biologics currently in the BMS pipeline at its new large-scale production facility in Incheon, South Korea. The company says the facility can accommodate multiple products, including BMS’s rheumatoid arthritis drug abatacept, a late-stage rheumatoid arthritis drug, and belatacept. Production of one BMS product is expected to occupy a major portion of the 50,000 L of bioreactor capacity at Incheon, according to Celltrion.

Lonza, which has a contract with BMS, released a statement saying “the current long-term agreement for the large-scale production plant in Portsmouth, N.H., [remains] unchanged.”

Lonza’s stock hit another snag two weeks ago on reports that another customer is adding bio-pharmaceutical production capacity. Genentech plans to buy Biogen Idec’s Oceanside, Calif., manufacturing facility. However, Genentech will use the new capacity to produce its colon cancer drug Avastin, whereas Lonza is responsible for the production of Rituxan. An industry observer says the new facility will not impact Genentech’s manufacturing alliance with Lonza.

Meanwhile, Lonza continues to bolster its global biopharmaceuticals manufacturing capacity. The company will spend SFr14 million ($11 million) to expand its clinical-scale mammalian cell culture manufacturing capacity at its Slough, UK, production facility.A 500 L stirred tank bioreactor system with an associated inoculum expansion area, media preparation and primary recovery capabilities, will be installed, and two new purification suites will be added. The new capacity is slated to come on line in the fourth quarter of 2006.

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