Protel tracks capex project activity across the main process sectors to help suppliers win new business. In this article we aim to present a quick and easy to digest run-down of the main trends and developments in a highlighted sector of the process manufacturing industries in one of our covered regions. For more information on the areas we cover, click here.
In 2019 capex schemes were being delayed or placed on hold, with concerns around the implications of the Brexit resulting in plans being shelved and investment programmes altered.
Brexit uncertainty has not gone anywhere, and will remain at least until the future relationship between the UK and the EU becomes clearer. Eventually it reached the point where organisations could not stall capex forever – with a move back toward capex planning shifting away from the maintenance and upgrades most seen over the last few years.
The coronavirus pandemic has eclipsed much of the uncertainty concerning Brexit, with a global push toward scaling up vaccine production hugely impacting the pharmaceutical sector globally with France, Belgium and the Netherlands no exception.
Global demand for vaccine production and associated products (e.g. syringes, vials and cartridges) has grown sharply, with global pharmaceutical companies such as GSK, Sanofi, John & Johnson and MSD taking centre stage during the race to fight the novel coronavirus.
As treatments around the world move toward approval, various players are in the process of gearing up production to meet demand. Worldwide, there are more than 100 vaccine candidates in development and over 600 clinical trials underway to find a treatment to use in the fight against COVID-19.
Diagnostics and treatments are also in the spotlight, as companies seek to find different clinical options to help treat patients while vaccine research continues.
In response to the above, we are seeing a number of concept studies taking place, along with a rush to repurpose existing plant to help service growing demand. Another emerging trend centres on greater collaboration between organisations, an example of which is AstraZeneca and Sanofi joining forces to develop a viable vaccine.
Animal health is still a strong area of capex, with MSD, Boehringer and Ceva Santé Animal planning or implementing high levels of investment in Belgium, the Netherlands and France respectively.
There are significant difficulties in the year ahead for those in the sector due to travel restrictions and site closures, which can make relationship building a challenge. This, coupled with exhibitions being shelved, means it is vitally important to seek other ways to broaden networks and maintain a presence with contacts.
Some examples of the major investors and their current focus that are currently being tracked on our project database include (full details available to subscribers):
• AbbVie – The Chinese health authorities identified their products as a potential treatment for COVID-19 and requested large supplies of their products.
• AstraZeneca – AstraZeneca is currently collaborating with the University of Oxford with an aim to bring to patients the potential vaccine being developed at the University of Oxford. Under the agreement, AstraZeneca would be responsible for development and worldwide manufacturing and distribution of the vaccine.
• Boehringer Ingelheim – developing therapies for COVID-19 in close collaboration with academic researchers, international institutions and others in the pharma industry. Boehringer Ingelheim has joined a fast track call for project submissions to develop Innovative Medicines to boost treatment options.
• GlaxoSmithKline (GSK) – collaborating with companies and research groups across the world working on COVID-19 vaccine candidates. GSK has announced that it has joined forces with Sanofi, bringing together two of the world’s largest vaccines companies which has not been seen prior to the pandemic.
• Janssen (John & Johnson) – initiated human clinical studies and anticipates the first batches of a COVID-19 vaccine could be available for emergency use in early 2021.
• Ipsen Global – donated €2 million to the Institut Pasteur to support the research projects currently ongoing. Ipsen Benelux donated 700 medical masks to various hospitals in Gent for healthcare workers on the front lines.
Other notable organisations include on the Covid-19 frontier are MSD, Eli Lilly, Merck, UCB, Novo, Pierre Fabre, all of which Protel have reported on.
There has been a massive focus placed on vaccine production across companies in the sector. One innovation in this area involves using multiple lines to produce different vaccines simultaneously which can then be switched to larger scale production of a single vaccine. This is mainly concentrated in GSK and Sanofi Pasteur currently, although other manufacturers may follow suit with will need to invest accordingly. It is likely that vaccines will remain the prevailing focus for capex in at least the year to come.
Alongside vaccine production innovation, there is a focus on quality control and testing processes. As such, we are seeing a number of new and revamped R&D and QA/QC labs being sanctioned to support this growth in demand.
In conclusion the future outlook remains extremely uncertain under the current climate. Although there are a lot of process upgrades and expansions to existing facilities, non-essential works have slowed. Although cell and gene therapy products have continued to enter the market and many engineering houses have been asked to carry out concepts for new facilities. European manufacturers face increasing competition from non-European companies.
At the start of the pandemic, experts were reporting that they hoped to find a vaccine within 12 to 18 months. Therefore over this period there will likely be intense growth and investment in the pharmaceutical/biotech industry in France, Belgium and the Netherlands. We are seeing a slowdown in the projects being released in the next quarter and much of the outlook beyond that hinges on a vaccine being successful and whether the current pandemic increases or decreases.
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