The go ahead was given after the contract manufacturing organisation (CMO) received a compliant rating from the Canadian regulator for its plant located in Toronto.
The official licensing of the facility will allow the company to manufacture sterile products, as well as test and ship commercial products for existing clients in Canada and the EU and to attract other commercial pharmaceutical manufacturing relationships, the company said.
"We have been approached by many of our clients who requested commercial services for their drugs so we decided to apply for an establishment license, the only way to be able to provide this kind of service," Peter Pekos, Dalton's CEO, told Outsourcing-Pharma.com.
In addition, the license Dalton has received from Health Canada - the Canadian equivalent of the FDA in the US - will enable the firm to target the European market, as Canada is a participant to a mutual recognition agreement (MRA), covering drug products Good Manufacturing Practices (GMP) compliance programmes, with the European Union. In other words, a GMP-compliant facility in Canada is equivalent to a GMP-compliant facility in Europe.
Dalton has been manufacturing and testing sterile products and active pharmaceutical ingredients (APIs) for clinical purposes for its customers for several years.
Now Dalton's clients can start with Dalton Pharma Services in clinical trial manufacturing and stay with Dalton through commercial manufacturing, the company said.
This will therefore require the company to considerably expand its capacity production, in particular for sterile filling. The company currently has a sterile filling line which can fill 10,000 vials per hour.
"To adapt to commercial volumes, we need to increase the production to around 100,000 vials per hour," said Pekos.
"In addition, we are expanding our lyophilisation capabilities and anticipate that we will also offer this service to our clients in the near future."
Meanwhile, Dalton is gradually switching from being a chemical API manufacturer to become a secondary manufacturer, which involves production processes that are necessary to take a material in its bulk manufactured form and create a finished dosage form.
"We have recently identified formulation services as an area of growing demand from drug companies and for this reason we have developed our manufacturing capabilities as we anticipate strong growth in this portion of the business," said Pekos.
He pointed out that secondary manufacturing, including formulation services, represents around half of the company's business and it is growing.
The firm now offers a transdermal delivery system to one of its Argentina-based partners and has got a pulmonary delivery formulation in the pipeline.
It seems that Dalton is moving in the right direction since a recent report from Marketresearch.com predicts sterile secondary contract manufacturing will reach $4bn (€3bn) in 2006, while primary contract manufacturing, the slowest growing sector in this market, is expected to reach approximately $11bn by the end of the year.
Pekos said his company has already signed manufacturing contracts with companies based in Canada, as well as Europe and the US.
"These are multi-year, multi-products contracts and represent several millions of dollars," said Pekos.
Looking forward, Pekos said that his company was now waiting to get the FDA approval for its facility which is pending and should happen in the next three to six months.
"We currently get 60 per cent of our business in Canada and 40 per cent omes from the US and with the forthcoming FDA manufacturing license we expect to reverse these figures and make most of our business outside Canada."