Monday, July 11, 2005


Capacity, pt 2

A few days ago I posted some "homework" dealing with researching the demand for production capacity for biologic manufacturing. Here is my first "report" on the issue. Thanks to BioBoom for the tip that Roche is building $700 million plus in new capacity for Genetech. This capacity will be used mainly for the production of Avastin and Herceptin. Couple this with Genentech's recent $400 million puchase of a facility from Biogen and you have some heavy duty upgrading of capacity. It looks like this capacity is going to be used to increase production of existing approved biologics. What I don't know is if some of this new capacity is to free up capacity at other existing operations for other biologics coming down the pipeline. So, here in the span of a couple of weeks, Genentech has spent over 1.1 billion in new facilities. I imagine some of these PMP guys wouldn't mind if they could just get 1% of that production. Granted, one of the facilities was available due to the scale-down in production predicted to be needed for Tysabri. But hey, I think this still sends a pretty clear signal that demand for production capacity in the near future (2-5 years) is going to be pretty strong. However, I don't know whether what is in the pipelines for these guys is going to keep the construction workers as busy as they have been (more research for me). The editor over at BioBoom makes a good point - who is getting the bio-production equipment business at these new sites? P.s. Here is the link to the article mentioned in the BioBoom blog

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