Italy A Quiet Outsourcing Standout For Drug Manufacturing?

By Louis Garguilo, Chief Editor, Outsourced Pharma

Italians, the quiet ones?

Perhaps in this regard. The relative attention Italy collects in our industry is not commensurate with the substantial development and manufacturing outsourcing that takes place in this European nation.

Coming out of COVID, in 2021, Italy’s pharmaceutical CDMO market generated about ~$3.5 billion, and accounted for an estimated 23% of European CDMO output. This made Italy the largest CDMO market in Europe, ahead of Germany’s ~$3 billion, and France’s $2.49 billion.

In 2023, it had risen to ~$3.7 million, and is forecast to reach just under $6 million by 2030. The market is expected to grow at a CAGR of 6.9% from 2024 to 2030.

Indications are Italy’s share of the total European market has also been growing; that’s attributed to strong capacity and ongoing investments, including in automation.

You might not have known of this growth and industry importance if you weren’t paying close attention. (Like I wasn’t.)   

In fact, when reviewed, Italy’s CDMO industry can be described as large, diversified, accelerating faster than many traditional manufacturing sectors, and buoyed by global biotech trends and domestic strengths in chemistry and automation.

Despite the onshoring focus in the U.S., sponsors not familiar with the Italian service sector might want to take a closer look. 

Major CDMO Players in Italy

About 150 domestic and multinational CDMOs operate in Italy, with roughly half focused on API/intermediates, and half on formulation and packaging. In recent years, Italian CDMOs have also moved into biologics and advanced therapies. 

Technologically, Italian CDMOs are known to invest in automation, and take Industry 4.0 and AI seriously.  Industry analysts credit Italy’s CDMO leadership to its investments in high-tech manufacturing (e.g., automation, process control).

To name a few of these CDMOs, Olon S.p.A. (Rodano, Milan) is the largest Italian API CDMO, with a global network of 11 production sites (9 in Italy, including 2 biotech facilities).

OLON has aggressively expanded by acquisition. For example, in 2023 Olon (backed by Permira) acquired Huvepharma Italia S.r.l. (Garessio site), boosting its capacity with automated lines and specialty chemistries.

Fabbrica Italiana Sintetici S.p.A (FIS) (Montecchio Maggiore (near Vicenza)), after years as a family-owned Italian API CDMO, has been controlled by Bain Capital, which became the company’s majority shareholder in 2023. The company has ~2,300 employees across three manufacturing sites in Italy, and serves a diversified customer base across 60 countries.

Content Group (headquarters in Rovereto sul Secchia, MO) does dosage manufacturing. An Italian CDMO specializing in ophthalmic and inhalation products (via its subsidiaries C.O.C. Farmaceutici and Tubilux Pharma), Content serves blue-chip and specialist clients with end-to-end R&D, clinical manufacturing and packaging of devices. With 3 plants (Rovereto, Sant’Agata Bolognese and Pomezia) it was projecting ~$13 million in sales for 2024 (over 50% export).

Adare Pharma Solutions (Seqens group) (Milan – Pessano con Bornago) focuses on tablets, capsules and granules for clinical and commercial supply. In March 2024, Adare announced a major expansion of its Pessano (Milan) facility, adding a new high-speed blister packaging line and large warehouse.

AGC Biologics (formerly MolMed, S.p.A.)(Milan – Via Olgettina) is a CGT CDMO. A specialized Italian CDMO now part of Japan’s AGC group, its Milan facility is Europe’s first GMP-approved manufacturing plant for ex-vivo gene therapies. In 2023 AGC expanded this site to significantly increase viral-vector capacity.

Recipharm Italia S.r.l. (Pianezza, Turin) is the Italian unit of Swedish Recipharm Formulations and packaging. It has a large location near Turin. Recipharm’s Pianezza site is a full-service CDMO for oral and topical generics (tablets, capsules, creams) and a major packaging center. It is accredited by multiple agencies (AIFA/EU-GMP, FDA, etc.) and has grown volumes (e.g. adding ColdZyme oral spray production in 2020).

Cambrex Italia (Paullo, Milan) – Generic APIs/CDMO. Part of Cambrex (Sweden), this site manufactures over 70 generic APIs and custom intermediates.

Catalent Pharma Solutions (Italia) (Aprilia, near Rome) focuses on Softgel capsules and oral delivery. The Italian subsidiary of US-based Catalent operates a facility in Aprilia that produces millions of soft gelatin capsules (oral nutraceuticals and pharmaceuticals).

Thermo Fisher Scientific (Patheon) (Monza, Milan area) runs a 642,000 sq ft campus, a premier sterile manufacturing site. The Monza facility handles prefilled syringes, cartridges and large vials, and in recent years has added viral-vector (mRNA) drug substance capabilities.

Service And Technology Mix

Italy’s strength is in small-molecule APIs, generics, and dosage manufacturing. Technologies in the nation include continuous flow reactors, biocatalysis and photochemistry, and there is increased adoption of single-use bioreactors, PAT (process analytical technology) and digitalization.

Regarding emerging biologics pursuits and CGT and other ATMPs,  Italian CDMOs have begun building capacity in these areas.

For example, AGC Biologics (ex-MolMed) runs a specialized gene-therapy facility in Milan (producing two approved CGT products to date).

Newer ventures like InnovaVector (AAV-based viral vectors, Pozzuoli, Naples) and Advaxia (adeno-vaccine, Pomezia) illustrate growth in biotech outsourcing. 

Regulatory Landscape

Italian CDMOs operate under European regulatory frameworks, with the Italian Medicines Agency (AIFA) enforcing EU GMP (Eudralex Vol. 4) at domestic sites. In practice, any Italian manufacturer must comply with stringent GMP standards, as emphasized by AIFA.

AIFA grants manufacturing licenses after site inspections and monitors compliance with EU directives (rebranded under Italian law).  Italian sites that export must also meet destination standards (FDA, ANVISA, etc.) – e.g. Recipharm’s Pianezza site is approved by AIFA/EMA and Brazil’s ANVISA.

Recent regulatory initiatives in Italy also aim to speed innovative product approvals and attract biomanufacturing (for example, streamlined processes for pandemic-related vaccines).

Italy vs Germany and Switzerland

In comparison to its neighbors, Italy holds a cost-advantaged position in Europe’s CDMO market.  Another strength is deep experience in small-molecule chemistry and dosage forms.

Italian CDMOs competitive pricing has attracted multinational contracts in generics and specialty APIs. 

Italy, however, depends heavily on imported raw materials from Asia.

Germany’s advantages include a large biopharma sector and strong public funding, but these are offset to a degree by higher labor and energy costs making production more expensive.

Switzerland’s CDMO sector is smaller in scale, but is home to global leaders (Lonza, Siegfried, PolyPeptide), and major pharma companies (Novartis, Roche, Biogen) that provide built-in demand. Swiss CDMOs have aggressively pivoted toward biologics, cell/gene therapies and high-value manufacturing. 

In summary, Italy may get talked about less when outsourcing manufacturing is discussed, but the Italians shouldn’t be quiet about its impressive CDMO market position.