Peregrine expanding own CMO to make mAb candidate rather than outsource

11-Dec-2014 - Last updated on 11-Dec-2014 at 15:45 GMT

Peregrine in-house? Firm chooses to expand its own CMO division to make lead candidate rather than outsource

Peregrine Pharmaceuticals is expanding its contract manufacturing capacity to meet growing client demand and to produce its own monoclonal antibody bavituximab, the company has revealed.

During a conference call discussing second quarter FY2015 results yesterday, Peregrine revealed plans to expand its subsidiary contract manufacturing business, Avid Bioservices, by more than doubling its capacity in Tustin, California.

Despite contract manufacturing revenue for the quarter being down 14% on the same period last year to $6.3m (€5.1m), CFO Paul Lytle told stakeholders the firm was experiencing increased demand for its mammalian cell culture services and needed extra capacity.

However, the decision to expand the site is also driven by the potential launch of Peregrine’s lead product bavituximab, a chimeric mAb bavituximab, currently in Phase III trials to treat patients with non-squamous non-small cell lung cancer.

“We are now at a time where we have anticipated manufacturing needs and exceed our current available capacity,” he explained on the call (transcript here), and following a price analysis to compare the cost of adding new internal manufacturing capacity versus the cost of outsourcing bavituximab, the firm chose the former.

“The cost of outsourcing our manufacturing need is fairly equivalent to the cost of building this facility,” he said, but the expansion has the “tremendous upside from the manufacturing side of our business and also the upside of controlling our manufacturing destiny.”

Single-Use at a fraction of the price

Peregrine has so far spent about $2m in relation to the new facility and while not revealing how much the total project would cost, Lytle said the site will benefit from “more efficient and cost effective disposable technology,” reducing the utility costs associated with traditional biomanufacturing.

“It is also important to note that the cost of building and manufacturing a clean room that utilises disposable one-time use technology is a small fraction of traditional facilities,” he added. Once complete, the new facility will include multiple single-use bioreactors with a range of up to 2,000L.

Clinical volumes of bavituximab are currently being made in Avid’s existing facility in both stainless steel and single-use bioreactors.

For the three months ending October 31, Peregrine reported a net loss of $12.1m, up 55% year-on-year.