The new entity, SAFC Supply Solutions, is part of a plan that calls for the creation of several high performing initiatives in the custom chemical business sector that are expected to drive SAFCs sales to over $400 million (€335 million) and secure its position as a top 10 fine chemical company worldwide.
Supply Solutions now becomes the latest segment of SAFC, joining SAFC Pharma, SAFC Biosciences and SAFC Hitech.
The business will additionally provide a customised supply of raw materials from its extensive product range, supported by a global supply chain.
Offering over 80,000 products, 40,000 of which are manufactured in-house, Supply Solutions' market focus will include organic raw materials for pharmaceuticals, biopharmaceuticals, IVD diagnostics manufacturers and flavours & fragrances.
Supply Solutions will also supply a broad range of industries with customised raw materials that meet specific manufacturing requirements.
The business is the result of a combination of the capabilities of the former Proligo Reagents manufacturing site in Hamburg, Germany, which was acquired from Degussa AG in April 2005, with SAFC's own Specialties business.
The acquisition made good business sense as the cost of shipping solvents from Hamburg to the US would have been prohibitive but with parent Sigma-Aldrich's production capabilities and supply chain, SAFC is now in a position to supply all the reagents needed for oligonucleotide synthesis in the US.
The new entity now joins SAFC's other manufacturing facilities located in cities worldwide, that include Steinheim and Hamburg in Germany, Buchs, Switzerland, Sheboygan, Milwaukee and St. Louis in the US, and Gillingham and Poole in the UK.
"The name 'Supply Solutions' more accurately reflects our ability to provide customised services around our extensive fine chemical and biochemical product range," commented SAFC President Frank Wicks.
Drivers for SAFC's continued growth include focus on production and supply chain systems - together with further product and service offers, notably in Supply Solutions. Add-ons to the current technologies portfolio and SAFC's cGMP capacity are also part of the current strategic agenda.
The manufacture of high-potency APIs has become an attractive niche sector for custom manufacturers, such as Omnichem, as generating double-digit sales growth.
Pharmaceutical companies are increasingly recognising the benefits of outsourcing research and development to and in particular there has been a continual increase in demand for custom chemical manufacturing services for highly potent APIs.
SAFC's activities aim to compete with the current trend among contract manufacturing organisations to tap into niche markets such as this one, due to an overcapacity in the marketplace.
The number of recent investments in this area has led some industry observers to suggest that competing in this sector may soon become a challenge.
One such competitor is Omnichem, which are increasing its Class V handling capabilities with an expansion of their facility in Louvain-la-Neuve, Belgium.
The new facility will add 4,800 litres to its high potency active pharmaceutical ingredient (API) manufacturing capacity in the form of two segregated production lines, each with vessels of 800 and 1,600 litres and occupational exposure limits (OEL) down to 0.1 µg/m3.