Building a business case for a fully continuous biomanufacturing platform
Integrated Continuous BiomanufacturingJason Walther 23 October 2013
www.genzyme.com
Sol Pompe disease Argentina
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• Genzyme developing a continuous integrated platform− Technical results are promising
− But can we justify the platform from a business perspective?
− And can we use economic modeling to guide development?
Fully continuous biomanufacturing platform
2
High-productivity Smaller facilities Media requirements
Steady state Consistent operation Steady quality
More automation Increased complexity Less labor
Single-use tech Faster build times Reduced turnaround Closed process
Volume reduction Smaller facilities No scale-up
Step reduction Smaller facilities Simpler process
Economic drivers for the continuous platform
3
CAPEX OPEX Risk
• Can we quantify these advantages and disadvantages?
Universal platform Omni-product facilities Common work force Flexible infrastructure
Financial valuation methodology
Outputs
Cash Flow Projections
Financial Indicators
CVI, NPV, IRR, etc.Discount future costs
Facility Estimates
CAPEX/OPEX savings using the new platform
Assessment
Inputs
Develop-ment Costs
Launch Scenarios
• Estimate CAPEX/OPEX using BioSolve software• Estimate platform dev costs and lay out a future product timeline• Predict discounted cash flows for legacy & continuous platforms• Calculate financial indicators (e.g., NPV) and make assessment
• Use BioSolve software package− Define process (unit ops, scaling rules, assumptions)
− Calibrate cost data (equipment, materials, labor, etc.)
− Benchmark against previous internal and external projects
− Biosolve capital estimates are acceptably accurate
Facility estimates: CAPEX and OPEX
5
Facility Scale(Reactor # and Size)
Facility CAPEX (Actual:Estimated)
Facility A 4X20,000L 104%Facility B 12X12,000L 101%Facility C 6X15,000L 101%Facility D 3X10,000L 102%Facility E 3X4,000L 120%
Fed-batch1X10,000L SS
Batch12 days
3000 Mcell·h/mL3.5 g/L
US
DSTimeIVCDTiter
US
DSTimeVCDTiter
Suspension perfusion2X500L SUContinuous
60 days100 Mcell/mL
1.4 g/L
US
DSTimeVCDTiter
Suspension perfusion1X500L SUContinuous
60 days100 Mcell/mL
0.5 g/L
Facility estimates: Platform assumptions
6
mAb500 kg/y
Enzyme20 kg/y
Legacy Platform Continuous Platform
US
DSTimeVCDTiter
Microcarrier perfusion2X2,000L SS
Batch60 days
5 Mcell/mL0.05 g/L
Facility estimates: Platform assumptions
7
mAb500 kg/y
Enzyme20 kg/y
CAPEX ($M) OPEX ($/g)
3X
1X
50X
8X
1.2X
1X
2X
1X
Legacy
Continuous
mAb CAPEX
Cost impacts of the fully continuous platform
8
mAb OPEX
Overall: –54% Overall: –20%
% o
vera
ll co
st
• Financial estimates can guide process development− (For example, CSPR and VCD targets)
CAPEX/OPEX sensitivity analyses
9
Viable cell density
Cel
l-Spe
cific
Per
fusi
on R
ate
CAPEX Savings(Fed-Batch mAb – Continuous mAb)
OPEX Savings(Fed-Batch mAb – Continuous mAb)
Red = More Savings
Push tohigh VCD,low CSPR
break-even
break-even
• Financial estimates can guide process development− (For example, CSPR and VCD targets)
CAPEX/OPEX sensitivity analyses
10
Viable cell density
Cel
l-Spe
cific
Per
fusi
on R
ate
ΔNPV for a single facility(Fed-Batch mAb – Continuous mAb)
Red = More Savings
Push tohigh VCD,low CSPR
break-even
Financial valuation methodology
Outputs
Cash Flow Projections
Financial Indicators
CVI, NPV, IRR, etc.Discount future costs
Facility Estimates
CAPEX/OPEX savings using the new platform
Assessment
Inputs
Develop-ment Costs
Launch Scenarios
• Create a hypothetical product timeline with various mAb and enzyme product launches
• Calculate NPV for two scenarios− Legacy platforms (fed-batch and microcarrier perfusion)
− Universal continuous platform
• Compare NPVs to estimate value of new platform
Product launch scenario
12
20322031203020292028202720262025
Advanced Modeling – An Integrated Approach
13
SalesProfiles
Development Profiles
StockingStrategy Portfolio NPV
Dashboard
ManufacturingNetwork
Product Definition
Product NPV
In partnership with Biopharm Services Ltd.
Relative cash flow projections
14
• Clear benefits to new platform (given the assumptions)
• Hundreds of millions of dollars in potential savings
mAb OPEXEnzyme OPEXmAB CAPEXEnzyme CAPEXDevelopment Cost
discount rate = 7%
ΔNPV for product portfolio
Relative cash flow projections
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• Different product launch scenarios can be investigated
• Continuous platform competes in a variety of scenarios
Low demand
Medium demand
High demand
ΔNPV for product portfolio
• Infrastructure in place for economic modeling of future platforms
• Preliminary analysis shows strong, quantifiable business drivers for continuous platform− We will continue to revisit and improve assumptions
− Additional sensitivity analyses
− Expand comparisons to other platforms (e.g., disposable FB)
• Process development guidance− Cell density and CSPR are influential upstream parameters
− Similar parameters will be found for downstream process
Conclusions
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• Genzyme Late Stage Process Development
• Genzyme Capital Finance
• Genzyme Industrial Affairs
• Sanofi Biologics Research & Development
• Biopharm Services
Acknowledgments
17