Chime Biologics Targets Expansion in Asia and Europe While Navigating Biosecure Act
China-based CDMO, Chime Biologics, has announced plans to significantly expand its manufacturing capacity as it looks to boost its drug substance capacity from 28,000L to 100,000L, with targets to enable the production of 15-20 commercial products. As part of the expansion plans, Chime will set up a subsidiary in Switzerland to target Asia-Pacific markets - including Japan, the Middle East, South America and Africa - with a unique ownership structure implemented to navigate the regulatory challenges of the U.S Biosecure Act which has recently targeted Chinese companies.
The following article originally appeared in PharmExec.
The global biopharmaceutical industry stands at a critical juncture. This industry's interplay of innovation, intricate supply chains, regulatory requirements, rapidly evolving technology, and US/China geopolitical tensions exemplify the BANI (brittleness, anxiety, nonlinearity, and incomprehensibility) framework’s components.
These challenges may hamper pharmaceutical and biotech companies in their quest to offer more accessible drug treatment for patients worldwide. As the president and founder of global CDMO Chime Biologics, I’m constantly considering how to match our capacities to meet the demands of customers both now, and in the future. This article recaps key industry trends and explores how the relationships between these companies and CDMOs are evolving to better meet the challenges of a BANI world.
Recapping key trends
Licensing deals involving Chinese pharmaceuticals have increased more than ten times over the last few years. The simple reason is that drug discovery infrastructure has boomed in China. There are excellent drug discovery platforms in China. That's why drug discovery R&D is the most efficient in China, especially for antibody–drug conjugates or ADC-related drugs designed as targeted therapy for treating cancer. Relative to the US, ADC drug discovery costs could be ten times lower, while the speed in China is much faster.
This is why Western pharmaceutical companies are increasingly engaging in licensing deals with Chinese counterparts, as highlighted by the FT.1 Merck, GSK, and AstraZeneca are part of this trend, contributing to a record $44.1 billion in biotech investments last year, according to UBS research. This momentum has continued into 2024, with $9.8 billion worth of biotech licensing deals signed in the first quarter alone.
Meanwhile, pharmaceutical and biotech companies are increasingly developing both small-batch and blockbuster drugs simultaneously, creating a need for specialized manufacturing support. The differing manufacturing procedures for each type of drug make it less economical for even the largest pharmaceutical companies to maintain in-house capabilities for both. This is where CDMOs play a crucial role, leveraging their niche and in-depth expertise to meet the specific requirements for the clinical and commercial production of sensitive molecules.
BANI-related concerns have also risen recently with global stock markets tumbling on Monday (Aug 5, 2024), as fear of a US recession and the impact of the Federal Reserve cutting rates in September sent investors fleeing from risk. These capital market developments are likely to mean that pharmaceutical and biotech companies worldwide need to further optimize their outsourced manufacturing operations.
Risk-sharing models for resilient growth
Chime Biologics has started adopting a risk-sharing payment model with our clients, especially those in the US and Europe, with upfront milestone-based payments linking the success of these clients to our CDMO service. Such a risk-sharing model marks a significant departure from the traditional fee-for-service approach. Currently, the US and European CDMOs are not offering such a model.
This risk-sharing model reduces upfront costs for pharmaceutical and biotech companies, giving them more shots on goal. In the current global financing landscape, this means these companies could achieve a significant value inflection point without spending a big portion of their budget on CMC (chemistry, manufacturing, and controls).
By aligning our success with our clients, we foster a collaborative environment that accelerates the development of life-saving treatments while achieving an optimal balance between quality, cost, and efficiency. Reaching a balance is crucial for late-stage commercial manufacturing projects, where time and budget constraints can significantly impact success. In a non-linear and often unpredictable industry, this ability to offer flexible solutions helps innovative therapies reach the market more swiftly.
Despite BANI-related uncertainties such as those introduced by the proposed Biosecure Act, the most critical factor for a CDMO continues to be the ability to offer one of the most high-quality, efficient and cost-effective solutions globally. Small and medium-sized companies in the U.S. and Europe prioritize this blend for potential CDMO partners since they have fewer projects and resources relative to global pharmaceutical conglomerates.
This focus is especially important for late-stage commercial manufacturing projects when it’s critical to meet the requirements of the U.S. FDA, EMA or China’s NMPA. A relentless focus on customer needs is a key reason why our business is rapidly growing, demonstrating that with the right strategies, CDMOs can play their part in helping the global biopharma industry thrive amid uncertainties and intricacies.
For more, please find the original story source here.
