Erbitux' success leads to 190m plant for Merck KGaA
pharmaceuticals in its 338-year-old history, as its top-selling
oncology drug Erbitux (cetuximab) has driven the company to
allocate €190m for the construction of its first biopharmaceutical
production plant at its headquarters in Darmstadt.
Erbitux, a monoclonal antibody for the treatment of colorectal and head-and-neck cancer, is Merck's flagship medicine, with its sales jumping 56 per cent year-on-year to €81m in the second quarter of 2006, so its strong performance has persuaded the company to gradually bring its production in-house.
The drug is currently manufactured in Europe by Boehringer Ingelheim, but this will change after the new plant comes on stream in 2010.
"We are happy with the work Boehringer Ingelheim are doing, however we intend to wind down their contract once we get in-house production of Erbitux going," Merck spokeswoman Phyllis Carter told In-PharmaTechnologist.com.
"This product is of vital strategic importance for us, so having our own manufacturing facility means we are in complete control of production and can respond quickly to changes in supply."
The move is consistent with a growing trend among pharmaceutical companies to bring the production of biologics in-house, only outsourcing fast steps requiring high volumes; a close example is Genentech, who last year, following its $408m (€320m) acquisition of Biogen-Idec's Oceanside facility, irked contact manufacturer Lonza by dramatically hiking production capacity, with the blockbuster Avastin, another monoclonal antibody used in cancer treatment, playing a key role in the decision.
As far as Merck is concerned, the manufacturing status quo in the US will not change because Erbitux there is made by ImClone, which has granted Merck the rights to develop and market the drug everywhere in the world except the US and Canada.
Merck first launched Erbitux in 2003 and now markets it in 52 countries, launching it in India earlier this month, and with demand for the drug increasing, the pressure is mounting on the company to ensure its long-term supply.
The German firm said it picked Darmstadt for its excellent infrastructure, highly qualified workforce, internationally acclaimed academic environment and central geographic location, in addition to it already being Merck's base.
Approximately 190 positions will be created by the facility, which Merck claims will be used to manufacture the latest generation of biological active ingredients for the treatment of cancer.
As margins in its generics business are squeezed by fierce competition, oncology has emerged as a major source of revenue for Merck, and there is potential down the line for the company to use the new plant to manufacture matuzumab, a monoclonal antibody in clinical development for the treatment of gastric, cervical, pancreatic and ovarian cancers.
