Suddenly the hottest thing in biopharma isn’t a new indication, disease target or modality—it’s manufacturing, and all of pharma is going to be vying for capacity and talent.
How do you get a bunch of investors on Wall Street to understand the importance of manufacturing? If you’re Thijs Spoor, CEO of radiopharma biotech Perceptive Therapeutics, you take them straight to the factory.
Spoor’s entire year has been spent “pretty much talking supply chain,” he told BioSpace. His company is developing radiopharmaceuticals, an area of drug development that has seen frenzied Big Pharma dealmaking. But the complex manufacturing processes required to turn radioactive isotopes into therapeutic agents has the potential to scare off investors who don’t understand how a company will scale, or how the therapy will get from A to B when a patient needs it, Spoor explained. So despite being in the early stages of clinical development, Perceptive is centering manufacturing in its pitches—and the decommissioning of a manufacturing facility provided the perfect opportunity.
“We finally got investors over the hump by literally doing tours of our manufacturing site. We said, don’t look at pictures, just come on in,” Spoor said. “We invited everyone to go and touch and feel the manipulators and try it out. And we left with some extraordinary converts who all said, yeah, we didn’t get it. Now we totally get it.” Clearly, the hands-on offering worked; Perceptive has managed to build up its cash reserves to $250 million, enough to fund operations into mid-2026, compared to having just a two-month runway of $9.2 million a year ago.
Spoor’s story underscores a high-level trend that’s been playing out across biopharma this year. Manufacturing is key, and it’s becoming more important to address and prepare for earlier and earlier in the drug development process.
“Being able to check the box of, can you actually manufacture this given the complexities, as opposed to something off the shelf, is becoming a very important question,” Jay Hartenbach, president and chief operating officer of early-stage cell therapy biotech Diakonos Oncology, told BioSpace.
Big Pharma’s Big Buy-In
Just look at Eli Lilly and Novo Nordisk, which are both scrambling to shore up supply of their wildly popular weight loss drugs. So far this month, Lilly splashed out $3 billion to ramp up manufacturing at its Kenosha County, Wisconsin facility, while Novo similarly put $410 million into its Danish manufacturing operations, bought out a plant from Novavax for $200 million and announced plans to break ground on a brand-new rare disease facility. Meanwhile, parent company Novo Holdings is about to close the $16.5 billion acquisition of contract development and manufacturing organization (CDMO) Catalent.
Of course, while Novo and Lilly may have a stranglehold on the obesity market at the moment, they aren’t the only ones making such investments. Amgen is pumping money into manufacturing, committing $1 billion earlier this month to its North Carolina operations, adding 370 jobs in the process. The company didn’t disclose many details about what the investment would help produce, but with obesity drug MariTide in Phase II development, it’s likely that Amgen could compete with Lilly’s and Novo’s offerings if eventually approved.
This investment from Big Pharma reflects the manufacturing-first mindset the industry has taken on—and parallels the push toward blueprinting supply chain plans at the earliest stages of drug development. That’s because both large and small companies are facing the same transformative realities.
This past year has seen “existential shocks to the system” on the manufacturing front, according to Spoor.
One of the most jarring was the BIOSECURE Act, which directed biopharma to move away from using Chinese-based CDMO WuXi Biologics. Spoor said that this time last year, Wuxi was part of the mix. Now his company has to find new suppliers and manufacturing partners. The legislation was not included on an end-of-year defense budget bill, however, leaving the issue in limbo heading into the new year.
2024 has seen investors gravitate toward late-stage assets that already have the scalability problem solved with a clear path to profitability, according to a new report from Pitchbook. Hartenbach agreed, telling BioSpace that scalability has become a key part of early due diligence in any sort of dealmaking or financing conversations.
That means early-stage biotechs, if they want to stand out, would be wise to show not only what their technology is capable of, but how they can make it at scale. In addition to the tours Perceptive gave its potential investors, the company has bought several buildings in Texas, Illinois and California to be used for manufacturing, spending over $20 million, according to a recent earnings report.
Similarly, Diakonos recently signed a deal with Cellipont Bioservices, which just opened a dedicated cell therapy facility in Texas for manufacturing. This has made investment a little easier for Diakonos relative to its peers, Hartenbach noted. The biotech raised $11.4 million in seed financing in August to bolster manufacturing and move its glioblastoma cell therapy into a Phase I trial.
A challenge in boosting manufacturing capacity, however, is finding the right talent, Spoor said. While the biotech industry has seen a stubborn trend of layoffs, the CEO said it’s a good time to be a chemistry, manufacturing and controls consultant in the industry.
That demand is likely not going anywhere, particularly as the potential for GLP-1s has barely scratched the surface in terms of possible indications and supply, added Anil Kane, executive director and global head of technical and scientific affairs at Thermo Fisher Scientific. The pharma industry must plan for high volume manufacture of sterile injectable or oral dosage forms of these medicines. This will require “careful and early planning” for in-house manufacturing and outside CDMO partnerships, Kane said in an email.
That seems to be what the industry is doing now, with Lilly and Novo leading the GLP-1 space. BMO Capital Markets said Novo will begin seeing new capacity come online as a result of the deal with Catalent in 2026, underscoring the lengthy timeline between investment and the ultimate impact of these investments.
