Roche is set to raise $1.2 billion from the sale of a US biologics manufacturing facility to Swiss contract development and manufacturing organisation (CDMO) Lonza, part of a drive to match capacity with pipeline requirements.
The pharma group has been looking for a buyer for the plant in Vacaville, run by its Genentech subsidiary, since the middle of last year. First opened in 1998, it is said to be one of the largest in the world for biologic medicines with more than 427,000 sq. ft. of space devoted to manufacturing, maintenance, laboratories, office space, and warehousing.
Roche has said it was looking for a buyer who would commit to keeping the site operational and safeguarding jobs. That looks like it has been achieved, with Lonza saying it plans to offer employment to around 750 workers employed there – the bulk of what Roche said was an 800-strong workforce last year.
Roche has indicated that it needs to reduce commercial-scale production capacity for biologics as a result of diversification of its pipeline into a broader range of therapeutic types, from monoclonal and bispecific antibodies to cell therapies and personalised cancer vaccines.
“This requires production of increasingly individualised medicines for defined patient populations rather than large-scale production of biologics,” said the company at the time.
Lonza is paying cash for the Vacaville facility, and has said it intends to invest approximately CHF 500 million ($561 million) to upgrade it so it can accommodate “the next generation of mammalian biologics therapies.”
Lonza will continue to make Roche medicines produced at the facility under contract for an interim period, phasing that out as it finds new customers, and said it expects demand for commercial-scale biologics production to remain high as new therapies emerge from the industry pipeline.
“The Vacaville site is a highly valuable strategic acquisition that will make capacity immediately available for our customers and unlock future growth,” said Lonza’s head of biologics Jean-Christophe Hyvert.
Biologics contributed CHF 3.7 billion out of total Lonza sales of CHF 6.7 billion and is the group’s fastest-growing division with a rise of almost 18% last year despite some market volatility caused by post-pandemic ‘resets’ in the sector. The company signed around 130 new CDMO customers and around 350 new clinical and commercial programmes in 2023.
The decision to buy the Vacaville plant comes after Lonza decided to decommission biologics sites in Guangzhou, China, and Hayward in the US, and after it built its position in antibody-drug conjugates (ADCs) with the takeover of Synaffix.
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