Highlighting Our Initiatives in 2018

In 2018 we have introduced several new initiatives and offerings to meet challenges in our markets. Internal initiatives across all pillars enable sustainable growth as an underlying foundation:

  • Excelling in quality, environmental, health and safety management and fulfilling our Vision Zero
  • Improving efficiency and productivity through automation and digitalization with a strong impact on operations
  • Consolidating our global network of assets and expanding our footprint outside North America and Europe for further enhancement of our global footprint
  • Constantly investing in targeted research & development initiatives and internal and external innovations

Highlighting Initiatives in Pharma & Biotech

In the last two years, we launched a series of expansion projects that would allow Lonza to continuously innovate and be prepared to enable our Pharma & Biotech customers to support patients. These projects included not only acquisitions, but also investment in cutting-edge technologies and conceptualization and realization of new business models.

The following major programs were initiated in 2018 to strengthen Lonza as the go-to partner for the pharma and biotech industry:

  • Expansion of Ibex Solutions with new, innovative offerings Ibex Design and Ibex Develop: They are designed to meet the evolving needs of biotech companies with antibody therapies, from the preclinical stage through to commercialization
  • Expansion of mid-scale biologics manufacturing and state-of-the-art technological advances at Lonza’s Portsmouth, NH (USA) site: The expansion includes 6,000 L mammalian capacity with a strong focus on automation and the use of state-of-the-art, single-use technologies for optimized processing
  • Expansion of Singapore (SG) single-use commercial mammalian manufacturing, which began in 2016: The first 2,000 L batches were successfully released from Lonza Pharma & Biotech’s new single-use facility in Tuas (SG) in Q4 2018. With the expansion, Lonza commissioned a hub for single-use commercial manufacturing in Asia to complement our existing mammalian network
  • Opening of the world’s largest dedicated cell-and-gene-technology facility in Pearland, Greater Houston, TX (USA): It is the first-of-its-kind, state-of-the-art manufacturing facility with capacity to produce treatment for thousands of patients suffering from rare genetic disorders or life-threatening diseases. Houston is one of Lonza’s four global centers of excellence in cell and gene technology
  • Acquisition of a controlling stake in Octane Biotech to further develop Cocoon autologous technology, a patient-scale, closed and automated cell therapy manufacturing system: This Cocoon system is part of Lonza’s array of cell and gene therapy offerings. The company is currently working with a number of customers who have therapies in various clinical stages to integrate the Cocoon manufacturing equipment as a key part of their clinical and commercial manufacturing strategy
Cocoon™ system: Automated cell therapy manufacturing system (mood picture)
  • Establishment of a strategic biomanufacturing base in Guangzhou (CN) using a GE Healthcare Solution: The new biologics facility, scheduled to be operational in 2020, will provide development and manufacturing facilities from early- to late-clinical and early-commercial stages. The facility will be based on Lonza’s proprietary platforms for development and GE healthcare’s KUBioTM off-the-shelf biologics factory for current good manufacturing practice (cGMP) manufacturing
  • Full changeover to Lonza operations, earlier than expected, in our Clinical Development and Manufacturing facility in Hayward, CA (USA): The facility was acquired in September 2017 from Shire – with first customer-batches having been released already in Q3 2018
  • Expansion of operations in Lonza’s Slough (UK) site for clinical development and manufacturing: The site will run 24/7 to account for increased demand in Lonza’s clinical services. The expansion also includes new offerings for development and manufacturing of complex proteins
  • Increase of capacity and expansion of capabilities in Parenteral Dosage Form development with a further build-out of our Drug Product Services (DPS) offerings in Basel (CH): Together with former Capsugel’s expertise in oral solids, Lonza provides high-end solutions for both oral and parenteral dosage forms
  • Grand opening of a dedicated highly potent active pharmaceutical ingredients (HPAPI) production train for Clovis Oncology Inc. at Lonza’s Visp (CH) site to exclusively produce Rubraca® (rucaparib) and an expansion of HPAPI development and manufacturing capacity for antibody drug conjugate (ADC) payloads, based on a tailored business agreement with a major biopharmaceutical partner
  • Opening of Lonza’s Collaborative Innovation Center in the Haifa Life Science Park in Israel: The new center will be a hub to identify and accelerate fresh solutions to rethink drug development and manufacturing

Additional information about our Pharma & Biotech initiatives is available here.

Highlighting Initiatives in Specialty Ingredients

Addressing evolving regulatory landscapes and identifying unmet needs in the marketplace, Lonza Specialty Ingredients in 2018 focused on converting those customer needs into solutions.

In the consumer space, we are capitalizing on the «whole health to whole life» trend as consumers are now directing their own way to take care of their health. Self-care methods such as nutritional supplements are addressing health concerns. Individuals increasiangly try to prevent or manage health through self-directed solutions. We have a broad portfolio of products and services; and, like Pharma & Biotech, Specialty Ingredients has demonstrated that we are continuously driven by investment in new technologies and complementary offerings to our current portfolio.

Capsugel, of course, is a big driver here; but also our InterHealth acquisition in 2016 added branded proprietary nutritional ingredients for dietary supplements and functional foods and beverages. Our brands include UC-II®, Super CitriMax®, Meratrim®, 7-Keto®, LOWAT®, ZMA®, Zychrome® and ChromeMate®.

The following major programs were initiated in 2018 to strengthen Lonza as the go-to partner for the fast-moving consumer goods, coatings and composites and agricultural industries – all serving consumer health and the consumer’s healthy environment:

  • Establishment of a venture capital (VC) fund to strengthen innovation and targeted research & technology
  • Expansion of production capacity at our Greenwood, SC (USA) site to combine capsule production, ingredient production and finished dosage form development: This expansion is part of an ongoing program to enhance production of Lonza’s nutritional ingredients and dosage-form technologies
  • Continued launch of new innovative specialty polymer solutions for hard capsules, such as Lonza’s delayed-release capsules (DRcaps) and lipid multiparticulate delivery technology
  • Continued launch of modern hygiene solutions and products offering effective prevention against pathogenic micro-organisms to meet increasing demand across all regions. Growth is driven by tighter regulatory landscape developments in the professional and consumer hygiene markets
  • Ongoing innovation initiatives to strengthen the personal-care portfolio, such as a recently launched bioactive functional ingredient that helps to protect skin against environmental stressors such as blue light
  • Opening of a new Research & Development Center for South America in Salto (BR), which allows the development of customized solutions for Bioscience Solutions, Consumer Health and Nutrition, Hygiene, Coatings & Composites and Agro Ingredients customers

The Consumer & Resources Protection division is focusing on further applying and innovating our microbial-control expertise in the specialty parts of our business like composites, material protection or agricultural crop protection.

As discussed at Lonza’s Capital Market’s Day in September 2018, initiatives for re-purposing of assets within the cyclical parts of the product portfolio, like basic materials or intermediates, are underway. For example, in 2018 Lonza launched a pharmaceutical early-intermediates supply initiative to leverage chemical production facilities at the Visp (CH) site. By vertically integrating early-intermediate production, Lonza addresses increasing global supply security and quality concerns. Lonza now offers our customers an integrated supply chain from non-GMP early intermediates to current good manufacturing practices (cGMP) advanced intermediates and active pharmaceutical ingredients (APIs). Lonza replaces current sources of non-GMP material, forward processes basic or specialty chemicals, and back integrates current API supply. The seven ISO-certified plants within the Visp complex provide more than 600m3 of reactor volume and a full range of capabilities across an array of chemical technologies to service customer requirements.

Furthermore, in 2018 Lonza featured a wide range of offerings for chemical supplies, including key raw materials that address the needs of customers affected by the China Blue Sky initiatives. These environmental initiatives were introduced for The People’s Republic of China by the Ministry of Environmental Protection and significantly reduced supply of raw materials manufactured in facilities not meeting minimum environmental requirements. Lonza could step up supply of these chemicals like Hydrogen Cyanide (HCN), Cyanogen Chloride (ClCN), Ketene and Diketene, Acetylene, Ethylene, Carbon monoxide (CO), Hydrogene (H2). Due to backwards integration, the supply comes out of Lonza’s multi-purpose production plants in Visp that offer customers highly flexible production concepts: 15 multi-purpose plants in 1 site, reactor volumes of 1–16 m3, total reactor volume of 750 m3 and access to the key raw materials listed above.

The fertilizer business, which had been part of Lonza for more than 90 years, was discontinued in 2018. In addition, we actively pursued an ongoing optimization of our Specialty Ingredients portfolio. As part of this process, Lonza decided to divest the Water Care business as part of our long-term strategy to grow sustainably along the Healthcare Continuum® and to focus growth initiatives and investments on our core businesses.

Additional information about our Specialty Ingredients initiatives is available here.