The company’s fiscal report for 2023 details revenue losses of $539 million and layoffs of 1,100 employees but notes that future GLP-1 manufacturing revenues could help stabilize its finances.
Pictured: Illustration of hypothetical revenue trends and predictions/iStock, Igor Kutyaev
New Jersey–based drug manufacturer Catalent Pharma Solutions’ 2023 annual report released Friday highlights the scale of the company’s recent financial difficulties. Specifically, the report notes that Catalent suffered revenue losses of $539 million in 2023 and cut 1,100 jobs, mostly in the biologics and corporate divisions.
Overall, Catalent made $4.26 billion in the 2023 fiscal year, down from $4.8 billion in the previous 12 months. As of June 2023, the company employed 17,800 employees across 52 facilities.
Part of the losses in both revenue and jobs have been because of idle facilities and slowing demand: the company is set to close a site in San Francisco and is anticipating paying $25 million in depreciation and closure costs. An idle facility in its biologics division cost Catalent a $54 million impairment charge, and a terminated project in its pharma and consumer health division that resulted in more idle equipment cost the company another $18 million.
Declining demand for COVID-19 vaccines and treatments “has affected and may continue to affect sales of the COVID-19 products we manufacture and our financial condition,” Catalent said in the report. Its biologics division’s contribution to net revenues fell to $1.98 billion in 2023, down from $2.53 billion the previous fiscal year, owing to this decrease in demand.
Nevertheless, the company is projecting revenue growth: its 2024 forecast, which Catalent reaffirmed in late November, estimates revenue of $4.3 to $4.5 billion. This is partially due to its growth in manufacturing GLP-1 receptor agonists.
The drug class has seen an explosion in popularity as a treatment for both diabetes and obesity, and Catalent has been spooling up its manufacturing capacity for Novo Nordisk’s GLP-1 receptor agonists. While revenues in 2024 are projected to only be $100 million, the company anticipates $500 million in annual revenue once production capacity is fully online.
Catalent CEO Allesandro Maselli also said during an investor call that Sarepta plans to scale up manufacturing plans in 2024 for Elevidys, a gene therapy for Duchenne muscular dystrophy. Maselli did not specify projected revenues, or comment on a question about a label expansion, but said that Catalent was projecting a 65% increase in revenue from its gene therapy customers in 2024.
The news strikes an optimistic tone after a rough start to the year. Catalent reported productivity issues and challenges at multiple sites. Novo Nordisk brought in Thermo Fisher Scientific to bolster its manufacturing capacity amid ongoing issues with Catalent’s facility in Brussels. The company also received notice in September that it was not in compliance with the New York Stock Exchange’s listing requirements regarding the timely filing criteria.
Connor Lynch is a freelance writer based in Ottawa, Canada. Reach him at lynchjourno@gmail.com.
