Global CDMO Catalent

Catalent, headquartered in New Jersey, has nearly 90 years of experience developing new drugs, with sales of 4 billion US dollars in 2021. The multifunctional pharmaceutical manufacturing platform in more than 50 locations worldwide provides more than 70 billion doses and 7000 million doses to more than 1,000 customers annually. With a variety of products, it has been the leader in the global CDMO industry for many years in a row.

▲Catalent trademark Catalent situation

Catalent is a CDMO listed on the New York Stock Exchange (stock code: CTLT). It has served the industry for nearly 90 years. It has helped accelerate more than 1,000 partner projects and launch more than 150 new products yearly. With its development and production technologies in the fields of oral preparations, injection preparations, inhalation administration, and cell and gene therapy, in the past ten years, it has provided drug production and R&D services for nearly half of the new drugs approved by the US FDA.

Catalent released its 2022 first-quarter financial report on November 2, 2021, with a net income of US$1.025 billion, a year-on-year increase of 23%, and an adjusted EBITDA of US$252 million, an increase of 52%.

▲Data source: Catalent 2022Q1 financial report

From the perspective of revenue region, Catalent's net revenue in the first quarter of 2022 mainly comes from the United States and Europe, accounting for 60% and 35% of total revenue, respectively.

▲Net income by geographical source, source: Catalent2022Q1 financial report

In terms of service areas, in the first quarter of 2022, biopharmaceutical services, soft capsule technology services and oral products, special drug delivery technology services, and clinical supply services were US$546 million, US$243 million, US$146 million, and US$96 million, respectively. Compared with the first quarter of 2021, the revenue of biological drug services has the highest growth rate, increasing from 44% to 53%.

▲Quarterly Net Income by Division, Source: Catalent 2022 First Quarter Financial Report

Regarding its talent base, Catalent has more than 17,000 employees, including more than 2,500 scientists and technicians. Previously, in the fiscal year 2020, the company ranked among the top three in the global CDMO industry with a revenue of US$3.1 billion.

From the perspective of barriers, the difficulty of production process development, and the scale-up of candidate new drug products, the gene and cell CDMO deployed by Catalent is far more complicated than other macromolecule and small molecule CDMOs. According to Frost & Sullivan's previous estimates, the overall growth rate of cell and gene therapy CDMOs is faster than that of other large and small molecule CDMOs, and its market share will increase from US$1.52 billion in 2019 to US$10.11 billion in 2026, with a CAGR of 31%.

The development of this "Battleship of New Jersey" has benefited from three transformations of iron and blood.

Soft Capsule

An innovator in soft gel technology, Catalent RP Scherer Soft Gels brings over 80 years of development expertise and manufacturing experience to all areas of lipid-based medicines. Catalent's main soft capsule technologies include traditional soft capsules whose shells are made of animal-derived gelatin and capsules made of plant-derived materials, OptiShell, which is Catalent's exclusive patent and has been proven to greatly increase the concentration of insoluble molecules. Bioavailability.

Today, Catalent has advanced RP Scherer soft gel technology with its soft capsule platform OptiShell. The combination of OptiShell technology and Catalent RP Scherer soft gel can encapsulate a wider range of lipid formulations.

▲OptiShell capsules, source: Catalent official website

Catalent's deep formulation expertise is backed by a global infrastructure of cGMP, FDA, EMA, and locally certified soft-gel facilities supporting more than 50 new Rx and OTC drug applications over the past four decades, the largest soft-gel facility in the world. Gel manufacturer, with more than 200 products in more than 80 countries, nearly four times that of competitors.

Biopharmaceuticals and gene and cell therapy services are the development focus of Catalent. Catalent relies on acquisitions to acquire factories and technology platforms to complete the "integrated, end-to-end" development of the CDMO biopharmaceutical business. Now Catalent is the leading enterprise of gene and cell CDMO.

The clinical use of biologics is complex and requires a lot of time and resources to ensure success. Customers are looking for a full-cycle solution. Catalent's OneBio integrated suite is an all-in-one solution from cell development to clinical supply; OneBio's integrated suite includes GPEx cell line development, bioanalytical services, discovery & development & biopharmaceutical manufacturing, drug filling, and clinical sample supply. Catalent leverages the OneBio Integrated Suite to reduce development time, risk, and complexity, accelerating resolution from cell line development through finished product supply.

Catalent's cell line development technology, GPEx, produces high-performance and highly stable cell lines in a variety of mammalian host cells. Whether customers use Catalent's cell line development technology or develop their cell lines, Catalent's process development services ensure Continuous cGMP production performance and reliable product supply; Secondly, Catalent has many years of experience in the development and manufacturing of biosimilar drugs and can use its comprehensive analysis capabilities and proven GPEx technology to accelerate the development of new drugs for customers; Catalent antibody-drug conjugates (ADC) and SMARTag conjugate technology are also unique.

Catalent has experience in developing a variety of large-molecule drug candidates, including but not limited to the following: 

• Peptides: conjugated peptides, pegylated peptides, fusion peptides; 

• Protein: glycosylated protein, non-glycosylated protein, fusion protein, an antibody-drug conjugate (ADC), monoclonal antibody (mAb), polyclonal antibody, bispecific antibody; 

• Vaccines etc.

Oral and Professional Delivery

Catalent's oral delivery Zydis technology is suitable for products of various sizes and indications, and now Catalent has extended the application of this technology to the field of immunotherapy. Zydis has launched more than 20 products in more than 60 countries and is still the world's first-class ODT technology.

Oral and delivery efficiency is greatly enhanced by the integrated solution of OptiForm®, a data-driven parallel screening approach that can quickly and efficiently solve complex bioavailability and formulation development challenges of poorly soluble compounds.

At the same time, Catalent is one of the world's most reliable brands of sustained-release oral solutions. It has more than 15 years of experience and has launched over 50 products in the American, European, and Asian markets. Catalent has thousands of successful molecular optimization experiences. The OneXpress™ solution shortens development to commercialization by 12 weeks, providing the fastest path from clinical development to commercial manufacturing.

Clinical Trial Supply

Catalent's clinical trial supply mainly provides manufacturing, packaging, storage, distribution, and inventory management for global clinical trials of drugs and biologics. New FLEXDIRECT™ clinical service (US only) launched in 2020, the traditional DTP method is to send clinical supplies from Catalent to the clinical trial site (site), which is then received by the clinical trial site, stored and finally distributed to the trial site as needed Patients; Catalent's FLEXDIRECT™ clinical service delivers clinical drugs directly to patients through pharmacies located in Philadelphia's clinical supply sites, eliminating the difficulties of receiving, storing and distributing test kits at clinical trial research centers.

Catalent has nine centers of GMP clinical trial samples located in North America, Europe, and Asia, plus more than 50 strategic layout factories located on six continents; Catalent supports trials around the world through global distribution facilities and distribution network, forming a powerful Clinical network, as of the fiscal year 2020, Catalent became one of the top three providers of clinical supply solutions in the world.

Catalent works with pharmaceutical companies at the earliest stages of the drug development process, ranging from OptiForm™ API optimization and Micron Technologies particle size optimization through specialty formulation screening and final drug formulation design services, all the way to leading bioavailability solutions. The breadth of services is an important criterion for evaluating the size and capabilities of CDMO companies. By building around the four sectors, Catalent can compete with global front-end CDMO companies with specialized skills in various fields.

So far, Catalent has realized the second transformation by creating four plates.

The third metamorphosis: Focus on attacking CGT

Catalent has achieved world-leading services in four sectors. However, the ambition of Battleship New Jersey is not limited to this. Using these four sectors as a springboard, Catalent has entered the gene and cell therapy field, which is the most complex and difficult technology with great potential.

Cell therapy, as a milestone new treatment method, provides new treatment ideas and approaches for diseases such as cancer. However, technical barriers limit the growth of the cell and gene therapy industry. In 2019, Catalent acquired Paragon, a viral vector development, and gene therapy manufacturing company, for US$1.2 billion to develop and produce complex biological agents such as adeno-associated virus (AAV) vectors, next-generation vaccines, oncolytic viruses, and lentiviral vectors for customers; in 2021 In February, it acquired MaSTherCell, a Belgian cell gene company, for US$315 million to strengthen its technology and production capabilities in gene and cell therapy; in June of the same year, it acquired RheinCell, a developer and producer of GMP-grade human induced pluripotent stem cells (iPSCs) After the completion of the acquisition, Catalent will use its proprietary GMP cell line for iPSC therapeutic drug development based on its existing cell therapy process development and production capabilities.

High production costs are a pain point in commercializing cell and gene therapy. Plasmids are the key starting materials and the main source of production costs for cell and gene therapy, and their importance is self-evident.

In June 2020, it became the first CDMO enterprise approved by the FDA for the commercialization of gene therapy; in February 2021, it acquired Delphi Genetics' 17,000-square-foot headquarters and manufacturing plant in Gosselies, enhancing its plasmid DNA manufacturing capabilities; in May, it acquired Promethera Biosciences Hepatocyte Therapy Support, a cell therapy manufacturing subsidiary of Catalent, will enhance its technology in the field of liver cell therapy, while Catalent will acquire a 32,400-square-foot facility for commercial-scale production of plasmid DNA.

As a leader in cell engineering and protein development technologies, Catalent serves CGT customers to develop biopharmaceuticals using three proprietary technology platforms, which are: 

• GPEx cell line development technology can generate high-performance, highly stable production cell lines. So far, Catalent has used the GPEx system to produce more than 600 different mAbs, mAb fusion proteins, and more than 80 different recombinant proteins in more than 125 ongoing clinical trials; 

• AAV vector technology is one of the most effective delivery tools in the field, Catalent Cell and Gene Therapy is a leading expert in the production of all AAV vectors in multiple serotypes (1, 2, 5, 6, 8, 9, 10), More than 90 cGMP clinical batches of AAV were produced.

▲The technical platform of cell gene products, source: Catalent official website

In addition to leading in technology, Catalent has also spent a lot of effort on clinical facilities. Catalent has established and grown world-class development and manufacturing centers around the world, with the majority of its cell therapy network of clinical and commercial facilities located in Europe and the United States, with approximately 67,000 square inches of Gosselies clinical manufacturing facilities in Belgium; in Düssel, Germany Dorff has a 7,500 sq. ft. iPSC clinical facility; and a 32,000 sq. in. clinical manufacturing facility in Houston, Texas, USA.

Through the supporting construction of technology, factories, and clinical supply facilities, Catalent has become a leader in gene therapy and completed a new round of transformation.

From the above development history of the New Jersey battleship Catelent, it can be seen that, like other biological giants, it mainly relies on precise entry into the field and large-scale mergers and acquisitions to promote the company's outward extension. Over the past century, the world's pharmaceutical industry has been a history of major mergers and acquisitions. However, not all companies have been able to advance to the leading position like Catelent.

Summarize

Catalent, a battleship in New Jersey, started from the supply of capsule preparations and has gradually become a global leader in gene and cell CDMO. "Buy, buy, buy" is, of course, the primary means for its upgrade. However, the long-term technology, pipeline layout, and market prediction are the core of Catalent's mergers and acquisitions to maximize benefits. In the past, the global new drug market and China's new drug market were hot, and the rapid development of the CDMO market also led to the birth of potential leaders in China's CDMO. There are also small and medium-sized CDMO companies sprouting in a steady stream.