Expert View: Understanding the India CDMO Market

Ashu Tandon, Chief Commercial Officer at Aragen, shares his perspective on the India contract manufacturing market, and the opportunities it presents for forward-thinking CDMOs and their customers.

Why has India become such an attractive country for biopharma outsourcing?

“Over the years, Indian CRO and CDMO ecosystem has evolved significantly and today ranks on a  par with any geography globally.” saya Ashu.

“India has a stellar reputation as the pharmacy of the world for small molecule manufacturing and has a large number of USFDA-approved facilities. Indian CDMOs are now increasingly investing in setting up biologics manufacturing capacities to replicate this success in the large molecule space.”

“Some of the unique strengths that make us an attractive alternative include a world-class talent pool of scientists with a strong track record of quality and compliance with approvals by multiple global regulatory agencies. “

“We have an English-speaking workforce that, in many cases, also has experience of working in leading Academic and Biopharmaceutical labs in the west. Thus, our teams are comfortable managing expectations of our global client base.

“Indian players have also been significantly investing in adapting the latest technology and leveraging the power of new-age Artificial Intelligence (AI) and Machine Learning(ML) -enabled platforms in their operations. This has helped in accelerating timelines without compromising on the quality.”

How much Aragen’s revenue grown in the recent years and what will be the main driver of growth for your business?

“Aragen has delivered CAGR in the mid to high teens over the last 5 years.”

“Overall, we expect both our Discovery and Development businesses to continue to drive our growth, across all modalities, including oligonucleotides, peptides, and antibody drug conjugates.”

“With the commissioning of our clinical scale Formulations manufacturing and biologics manufacturing facilities, the share of manufacturing in our overall revenue will increase in the coming years.”

When will Indian companies be able to take market share of biologics or cell & gene therapies?

Ashu believes India will strengthen its competitive advantage in the biologics sector over the next 3-4 years for several reasons:

• Evolution of Established CDMOs: Most service providers often start with small molecule discovery, development, and manufacturing before transitioning to biologics. India based CDMOs such as Aragen are making significant strides as they build on their existing capabilities and experience.
• Encouraging Market Trends: Indian CDMOs have achieved notable successes and received positive market recognition in this area. This motivates other CDMOs to venture into the biologics field, driving further industry growth.
• Government and Financial Support: Government initiatives such as the setting up of BIRAC – Biotechnology Industry Research Assistance Council, will help strengthen local innovation and infrastructure. Support such as this is poised to help Indian CDMOs enhance their expertise and expand their operations.
• Rising Global Demand: With increasing global demand for biologics, Indian CDMOs stand a good chance to capture more market share.
• Geo diversification: In the current geopolitical situation, companies are increasingly recognizing the need for geo diversification as part of their risk hedging and BCP strategy. Given its strong reputation, Indian CDMOs are expected to gain a competitive edge as many biopharma companies look for a China+ 1 strategy or a China alternative strategy.

However, there are also few challenges that the sector needs to overcome.

• High infrastructure cost: Due to the need for specialized equipment and facilities such as clean room; operational costs for maintaining quality standards and compliance are typically higher compared to small molecule manufacturing.
• Regulatory guidelines:  The regulatory environment for biologics, cell, and gene therapies is both complex and stringent. Obtaining approval for these advanced treatments can be a lengthy process, and local companies may find it challenging to navigate the diverse and rigorous international regulatory standards.
• Scientific talent base:  The development and production of biologics and cell & gene therapies require highly specialized skills and expertise which is not adequately available in the market to meet the demand.

How should Indian manufacturers build a reputation for the highest quality standards?

“India has a strong reputation in the global market for its expertise in manufacturing. “

“This reputation is based on strict adherence to global regulatory norms, assurance of supply, innovation, long term partnerships all combined with a financial proposition that has increased the penetration of Indian pharma exports to the global supply chain. “

“Increasingly, the industry is focusing on not just sustaining but also enhancing this reputation by focusing on some very critical parameters.

These include:

• Continuous focus and a strict adherence to Good Manufacturing Practices (GMP) and following the guidelines set by international regulatory bodies like the USFDA, EMA, and WHO
• Leveraging automated systems and digital tools for monitoring and controlling manufacturing processes
• Continuous investment in talent building and training to keep the workforce updated on the latest regulations and contribute to industry best practices.”

How is Aragen investing to keep up with demand?

“Aragen have announced an investment plan of around $250 Million over the next five years in expanding our R&D and manufacturing facilities in our Hyderabad campuses.” says Ashu.

“Aragen has been making strategic investments in extending capabilities and expanding capacities across all lines of our business. For example, we recently strengthened our drug product service offerings by adding clinical manufacturing capacity that will allow us to provide integrated drug substance, drug product and related analytical services as an offering. “

“Our biologics manufacturing plant in Bangalore can undertake non-GMP production for batches up to 50 litres. By the end of the year, we will further add GMP manufacturing capacity that can deliver manufacturing batches at 200L to 2KL scale.”

“We have added large-scale biomanufacturing capacity at our campus in California and are strengthening our capabilities in niche areas such as oligonucleotides, peptides, and antibody drug conjugates (ADCs).”

In April this year, Aragen announced that it has operationalised the first phase of its biologics manufacturing facility in Bangalore, India. The facility represents a $30 million investment and has completed its first small-scale manufacturing project for a US-based organisation, producing a novel anticancer monoclonal antibody (mAb).

Source – PharmaSource