Bridges, so to speak, have been built for cell and gene therapy (CGT) sponsors – and CDMOs – to access here-and-now available, fully outfitted GxP capacity.
More of them can’t get built fast enough.
According to research done by the Azzur Group and published in a white paper, the global CGT market is expected to rise from $7.7 billion in 2021 to $13.8 billion by 2026.
However, rising building and operational costs associated with CGT manufacturing, exacerbated by a slowdown in funding streams on the one hand, and the specific outsourcing needs for right-sized and equipment-outfitted facilities on the other, could start to restrain that growth.
If you are a CGT developer, that means your growth potential.
But, you might ask, won’t the CDMOs – like we’ve all come to expect – answer the call by adding expertise, and adjusting facility configurations/services, as per customer demand?
That has happened to a degree, and market-meeting measures continue to be set in place.
Nonetheless, CDMOs have challenges of their own, both with the speed of hiring skilled workers, and simply keeping up with the acceleration of CGT needs – particularly for immediate (and often short-term) capacity.
Something, as they say, has to give.
And what may “give” is once again the introduction of an innovative business model.
It is not necessarily a new model: “build-for-lease” is a tried-and-true strategy in many fields, and a mainstay for industrial real estate.
The innovation is in the flexible application of the model applied to our industry – short-term cleanroom leasing, and comprehensive but still project-specific contracts for the temporary autonomous utilization of outfitted facilities fit-to-purpose for (predominantly) pre-clinical CGT production.
Ravi Samavedam, Chief Innovation Officer, Azzur Group, says his company has conducted extensive analysis of the needs of the market. Based on that analysis, Azzur has built four “bridge facilities,” and will continue to “purposely build out more facilities with cell and gene organizations in mind.”
Those first four locations are in Boston and Burlington, MA; Raleigh, NC; San Diego and San Francisco.
Azzur has a history of partnering with the bio/pharma and med device industries to provide solutions for scale-up and “to sustain early GxP organizations.” (GxP is the term for the full range of cGMP practices.)
Azzur’s idea to acquire existing space (mostly warehouse or shells) and convert it to fully functioning “cleanrooms on demand” originated on the 5th floor of Moderna’s (at-that-time) new facility in Burlington, MA, in 2016. Moderna subsequently became one of Azzur’s first clients. We’ll detail that interesting unfolding subsequently.
But let’s start by looking at what differentiates Azzur from CDMOs, and how Azzur actually aids both sponsors and CDMOs (of all sizes, it turns out).
Model Me This
“First of all, what separates us from the CDMO model is we do not make the product for our clients,” explains Samavedam. “CDMOs are not direct competitors of ours. We have clients that are CDMOs.”
If Azzur isn’t making your product, what are they doing for you?
Here’s an example. The first impulse for a biotech that realizes it needs first-in-human material in, say, from six to 18 months, is to look for a CDMO that can help.
According to research Azzur has published, today in the CGT space that may put you in line for a project start-date anywhere from six to 24 months out. You’d be starting when you’d hoped to be ending.
The other option is to build, which at the present time, says Samavedam, “our research suggests for early phase manufacturers, unless you have multiple projects in a pipeline or are developing an internal platform process, you really should not be doing.”
Facility utilization is problematic early in a product’s life cycle. You don't need a batch every month; you need a few batches to get to the clinic, and then (relatively speaking) sit tight for clinical readouts. That means (again, relatively) idle personnel and equipment, and quality systems not in use but still needed to be maintained and monitored.
Instead, Azzur – and some other companies, including Cytiva and new entrant Smart Labs – provides a qualified facility, including continuous quality management of all systems, full maintenance and materials management.
The sponsor, says Samavedam, “Comes in, makes a few batches, and then moves out.”
Literally, moves out. That’s because this can be the perfect, short-term fit, “as long as the client is able to bring their skilled employees in to actually make the batch themselves.”
“If you are a virtual company without the requisite expertise for production, this is not for you,” explains Samavedam. “We make that clear to prospective customers upfront: ‘You have complete ownership of your product.’
“We'll coach and consult, but you have to hire a head of quality and manufacturing, and have knowledgeable professionals sign off on your batch records.”
Which, I’m thinking as I listen to Samavedam, may be less of a roadblock to his bridge facilities than it may have been in the past.
The (very) virtual biotech model that stretched the lean model to extremes seems to have been effectively reined in.
Executives we’ve spoken to over the past years agree that without internal resources that “scale,” or at least form a core group of experienced professionals, successful partnering with CDMOs has a diminishing chance of success.
Lean you may remain, but your cupboard can’t be bare.
This may in fact be impossible nowadays anyways. With the novel science, technologies and development platform strategies arising from developers like the CGT folks, the most knowledgeable professionals almost always reside internal to the sponsors.
Furthermore, if these types of bridge facilities (or cleanrooms for lease) begin to occupy a larger portion of the outsourcing industry, the model may even begin to influence how you as an emerging biopharma organize yourself from a personnel standpoint.
Might you start hiring with the utilization of bridge facilities as your early operational plan? Like we mentioned above, others such as Cytiva and Smart Labs are also providing levels of autonomous cleanroom accessibility. Samavedam sees others entering this business as well.
So we’ll have to see.
In the meantime, more details to follow in part two.