A Global Joint Venture Strategy for Biosimilars Development

Maribel Rios

December 1, 2013

16 Min Read

In April 2013, biopharmaceutical company Pfenex (San Diego, CA) announced a joint venture with biologics manufacturer Stelis Biopharma, Inc. (“Stelis”), earlier known as Agila Biotech, (a wholly owned subsidiary of Strides Arcolab Limited (Bangalore, India) for the commercial development of six biosimilars. The companies will also leverage technology and global development expertise from GE Healthcare Life Sciences (Uppsala, Sweden) and Bio-XCell Malaysia (Nusajaya, Malaysia). Such international, multicompany collaboration strategies have become a growing trend in the highly competitive biosimilars industry.

At the BIO 2013 meeting in Chicago, the BPI Theater hosted a roundtable discussion about the Pfenex–Stelis joint venture. Panelists included Bertrand Liang (CEO of Pfenex and panel moderator), Andy Iyer (CEO of Stelis), Daniel Bauer (commercial executive of GE’s Single Use Technology and FlexFactory), and Rizatuddin Ramli (CEO of Bio-XCell Malaysia). Below is a summary of the discussion, highlighting the biosimilars development strategy, which includes a new development facility dedicated to the project








Pfenex started with a novel expression platform technology. This technology drove all of the company’s other business units, including biosimilars. “When we were considering how we wanted to move forward in the biosimilars arena, we wanted to look for partners that would potentially have strength globally,” said Liang. “That is how we started working with Stelis. Both companies have some levels of responsibility around this joint venture. We’re starting in markets that are somewhat emerging. It is something that is facilitated with regard to not only our own technology, but also the reach of companies like Stelis, which could move some programs farther along.”

For this partnership, Pfenex is responsible for strain engineering, process development, and analytical package for each product. Stelis is responsible for phase 1 development, as well as current good manufacturing practice (CGMP) manufacturing. The joint venture will then progress the products through phase 3 and into commercialization. “With Stelis expertise in manufacturing and phase 1 clinical trials, our collaboration is well structured and well behaved,” Liang explained. “We are trying to combine the things that we do best. In that way, we are working toward decreasing the risk of affecting the development of our biosimilars in a global marketplace.”

Strategic Aspects

Stelis has manufacturing operations in six countries and a presence in about 70 countries. “Biotech is a new vertical, and we are rapidly ramping up our efforts in this area,” said Iyer. The company is currently building a state-of-the-art research and development (R&D) facility in Bangalore, India, and a manufacturing facility in Malaysia.

Iyer addressed the industry’s growing interest in working with companies located in emerging markets for R&D and manufacturing work. “There have been many companies around the world that have expressed keen interest to partner with companies in emerging markets such as India. They’re looking for a low cost, patent-free zone for regulated market manufacturing as well as products that can be exported to regulated markets. In addition, they are open to a strategy or a partnership that would help monetize their assets.”

According to Iyer, many products currently on the market are not available in emerging markets. “Partnering with a company in an emerging market would monetize those assets. It would also provide a time and cost advantage if you were to do R&D and develop it in countries like India.” Stelis is building strong R&D infrastructure in Bangalore, India and Nusajaya, Malaysia. The ~22,000-ft2 facility in Bangalore will employ more than 50 scientists in molecular biology, cell biology, process development, analytical development, chemistry, novel delivery technologies, and formulation technologies.

“This facility will be used to develop recombinant proteins, first-generation biotherapeutics, and monoclonal antibodies,” said Iyer. For implementing the technology into the new facility, Stelis partnered with GE and Bio X-cell Malaysia. Iyer said the manufacturing facility includes “R&D labs capable of handling high-end R&D process development and manufacturing to cater to both our internal pipeline and partnering activities. It is a single-use facility that will initially have a capability (with respect to mammalian products) of up to 2,000 L, expandable to 8,000 L; and microbial products capability to 500 L, expandable to 2,000 L.

Stelis is also building a formulation and fill–finish facility to meet both internal needs and that of its partners. “We are currently supplying fill–finish products for a couple of our major multinational corporation partners for biotherapeutics. So we’ll have capabilities in end-to-end product manufacture and fill–finish for recombinant monoclonal antibodies and therapeutic proteins.”

Facility design criteria included flexibility, scalability, cost, and production efficiencies. Iyer said both the R&D and manufacturing facilities are expected to be fully operational by the end of 2014.

Integrated Solutions

The Stelis facility in Malaysia is being built to CGMP commercial-ready requirements. It is designed to manufacture products using either a complete single-use manufacturing suite or a hybrid manufacturing suite incorporating both single-use and some stainless steel systems. The facility will be capable of supporting multidrug platforms, and the design will allow for rapid capacity and expansion.

“For this project, GE is being viewed as the integrated solution provider for the site in Malaysia,” said Bauer. GE (working with some key partners) is effectively taking on the responsibility of providing this facility for Stelis. The facility will be a modular design featuring prebuilt wall systems and a walk-on mezzanine.” Engineering and construction company M+W Group will provide the shell building and all ancillary infrastructures.

The Stelis conceptual design and basic design are based on single-use technologies. Key attributes that had to be integrated included multiple platform capability and low-cost drug manufacturing capability. “Single use processing provides for quick turnover of the manufacturing suite, which results in high efficiency use of drug-producing square footage. The primary basis of this design is the Xcellerex FlexFactory technology, now part of GE.”

The project is moving into basic design phase. “We’re creating a type C meeting package for the Stelis team,” said Bauer. “We will participate with Dr. Iyer in FDA meetings, then quickly move into the final design. Construction, of the fa
cility will commence soon thereafter. A key focus for GE is to reduce Stelis’s time and cost risk on the execution of this site. The fact is we can do a lot of things concurrently. We will work concurrently on the Nusajaya shell building, the construction of the wall panel system inside the shell building, and manufacture and integration of the FlexFactory suites in Westborough, MA.

“We’ll have the ability to put all process equipment together in Massachusetts — functionally integrating and automating the entire site—and to train Stelis staff while their factory is on our floor in Massachusetts,” said Bauer. “We create a central FAT and training site. Once complete, we ship it complete to Nusajaya for installation.”

During the FlexFactory integration in Massachusetts, GE will codevelop standard operating procedures (SOPs) and installation, operation, and qualification (IOQ) documents with the Stelis team. “This will also remove risk elements and greatly reduce time associated with those processes. And there will be an ongoing training activity with the Stelis staff, both in Westborough and at our GE site in Singapore.”

“The facility will integrate some of our competitors’ equipment,” said Bauer. “A perfect example would be on the microbial side. We don’t make a homogenizer. We don’t make a high-speed centrifuge. So you will actually see this facility using single-use processing with islands of steel. View this as a hybrid facility. We are, however, able to automate the entire system on a central platform.”

In addition, the facility can be expanded on-site without ever having to take the site down. Bauer said GE is also “working with the Stelis R&D facility team to make sure we have the same product contact flow path, so we can minimize the leachable and extractable package required as we advance Pfenex–Stelis products through clinical development and into commercialization. The key element is that within 18 months of purchase order we will be doing engineering runs.” These concurrent activities greatly derisk the execution and quick startup of the bioprocessing suites.”


Bio-XCell Malaysia is a government entity that “promotes and accelerates the commercialization of biotechnology,” says Ramli. “It is an industrial park with an environment for both the development of life sciences — particularly in healthcare — as well as industrial biotech, with green chemicals and other solutions that heal, fuel, and green the world.”

Nusajaya Johor is part of Malaysia, in the southern economic corridor of Iskandar and close to Singapore. “Those who are very familiar with Singapore know that all the big biopharma multinationals are operating there. That gives you a cost advantage and synergy in terms of an ideal site for biomanufacturing at pilot and large scale,” said Ramli. His company conducts space and infrastructure value-added services to the facilities. “It’s custom built. We take on cost services of industrial steam, chilled water, and industrial wastewater so that a company does not have to do it within their site. We call it ‘biotechnology shared services’ — shared among many other companies in the park. The laboratory information and communication technology services are shared services. Security on the site will all be maintained by our team.”

Ramli said his compay is working with GE and Stelis on the process equipment requirements for the Pfenex– Stelis products. The company plans to announce details next year


Audience Questions

What is the strategy for biosimilars for Stelis going forward?

Iyer answered, “By entering into the biosimilars arena, we aim to duplicate our success with branded generics and sterile injectables in the biotech space. And we believe we can do that. One of the things that Strides is renowned for is quality. All its facilities are approved by FDA, EMA, and local regulatory authorities. We have a stellar record in terms of delivering very high quality products in a cost-efficient manner for global markets in general and to emerging markets in particular.”

What is the target regulatory agency given the uncertainties within the regulatory world, particularly, for example, in the United States?

Liang answered, “We’re attempting to do this on a global basis. Certainly the 351(k) pathway in the United States is, at best, uncertain, but the fourth guidance from the FDA has come out and cleared up some of the issues. However, it is also clear that the rest of the world has been more accepting; the EU has now 14 biosimilar products, and there are other regions which have generated mirror regulations to the EMA. So I think we’re going to be looking at other regions initially for targeting with regard to the dossier that we create for these biosimilars.”

Iyer agreed. “Our goal is not to target the United States or other regulated markets right away. There is a vast region of the globe that’s underserved or not served at all by multinational companies with respect to biologics. We aim to target these markets first and from there grow into regulated markets, if and when the regulatory pathway crystallizes.”

For biologics that were made in mammalian cells, won’t that be a switch-over if you were to produce a biosimilar in thePfēnex Expression Technology system?

Liang answered, “Certainly if we were to make mammalian-cell–type proteins in Pfēnex, it would be quite the switch. However, we are really not doing that. We are sticking with those things that will be otherwise produced in an aglycosylated manner for biosimilars, and expanding our reach to take advantage of our expertise in protein production to create biobetters as well. We will no doubt expand our technological expertise as a result, which will allow us to further meet other unmet medical needs.”

How will the GE program, work with Bio-Xcell in Malaysia on the logistics side with regard to cost and cost savings?

Bauer replied, “I think one of the huge advantages that we provide is an integrated mindset. It’s a strategic view we have on the best way to implement single-use. When you focus on using single-use processing systems, one of the big advantages that comes up quickly is you get to eliminate some infrastructure, such as clean-in-place (CIP) and steam-in-place (SIP) loops. We’re working with Ramli’s team quite a bit on how utilities are brought to the sites and how we can reduce some of those utilities.

The other huge advantage of single-use technologies from a cost perspective is that you can actually take a suite and turn it over in hours instead of days. I think the general acceptance in the industry, depending on who you talk to, this process is usually about a week at a minimum — or four to five days if you’re really skilled. We are doing the same in three to six hours. So the use of this square footage is going to rapidly go up, which in itself drives cost way down. So huge benefits to Stelis. And then on what Bio-Xcell has to build to satisfy the needs of Stelis, that will al
so be greatly reduced because of this focus on single use.”

What is current plan for facility construction over the next year or two within Malaysia with regard to infrastructure support?

Ramli responded, “The infrastructure support has been built, but it will be continuously looked at and upgraded. Right now, with Stelis, there will be two other projects that we are going to run concurrently but in a different space that is not the pharma space at the Bio-XCell site. Otherwise, the aim is about planning.”

What do you think about the breadth of use of disposable technology, not only in microbial but also in mammalian cell work?

Bauer answered, “It’s fair to say single use is here to stay. It’s not going to go away in its implementation and integration into our industry. I think we have to learn how to use it wisely and realize that some of the current technology just doesn’t allow us to use it in all applications.

The thing that was very attractive about Xcellerex to GE was the functionality of its XDR bioreactors and single-use integration know-how. This was a company that was started by a team of about eight people who had collectively brought four drugs to commercial approval in stainless steel, wanted to do things with single-use technologies, and went about inventing equipment that was as good or better than stainless steel designs to be used in Xcellerex’s original CMO business. The equipment was refined and proven over time before being made commercially available. GE offers different types of FlexFactory solutions. Some models use controlled environmental modules (CEM) to create Grade C air space around downstream single-unit operations. Other suites feature traditional cleanrooms segregation between upstream and downstream. This is what we will be providing in Nusajaya.”

Are you going to be able to put in more FlexFactory suites into a given area for Stelis within the Malaysian facility? Or are you just going to put “bigger tanks”?

Bauer responded, “Our goal is all of the above. We want to put as many 2,000-L XDR bioreactors as we can in the current facility design, and we want to just keep building with Dr. Iyer as his company grows.

The way we’re going about the design and the way we’ll be working with Ramli is to build in some of that planned expansion activity. But to your point, we can’t expand vertical in the facility. We can expand capacity by brining on-line multiple deployments of XDR bioreactors that can still work in a serial processing fashion with the same downstream formats. And when we reach that capacity, then we’ll be adding on additional suites. To your point, you can build a functional 2,000-L base FlexFactory in about 3,200 ft2. So there is a great economy to scale with this approach to manufacturing.”

Dr. Iyer, will you be actively involved helping Stelis with training personnel for the site in Malaysia?

Iyer said, “With respect to talent that we are going to take from India, we already have a training program in place. Strides has a talent school that it has developed as a part of its pharma program. With our technology partners, we will develop a training program in Malaysia that will cater to our needs. If you look at that region you see not only companies that originate in, say, India or other emerging markets, but a number of multinationals are also now setting up large manufacturing capabilities in, say, Singapore. So there is a significant requirement for talent. And we believe that through creative partnering with the Malaysian government, with our technology partners, that we can meet the growing needs of companies in that area.”

If you’re going to be growing a talent pool in that part of the world, is it going to be something that you’re going to actively collaborate on with regard to the Bio-Xcell and Stelis?

Iyer said, “We are developing a joint plan with Bio-Xcell and some of our technology partners in putting this training school together. We believe a solid talent pool exists, they just need to be harnessed and channeled in the right way. And if we provide them with the right training, we believe that we will have a winning formula for sustaining the companies that are moving to that geographical location.”

Dr. Iyer, when you were looking at what Pfenex was doing in biosimilars, what were your key criteria to look for partner relationships?

Iyer replied, “We saw a convergence of strengths. Pfenex had a technology platform that was unique. We saw that it was committed to its technology platforms and was committed to developing a number of biopharmaceutical products. We believe that since Pfenex had the jump in terms of the expression technology platform, then we could come from the manufacturing side and provide the clinical development and CGMP manufacturing capabilities that Pfenex doesn’t have, especially in that part of the world.

“In addition, what we get access to is not just a product. By locating our facilities in Malaysia and our R&D in India, we also get access to nearly 3.5 billion people through various mutual agreements between India, Malaysia, and South Asian countries. Also because Malaysia is part of the OIC countries, we get access to 57 Islamic countries that are in that part of the world. In addition, India, because of its proximity to CIS countries, we can access CIS countries as well. So before we even think about regulated markets, we have this huge market base in India and many emerging economies. Some are moving from low income into middle income, and from middle-income into upper-income economies. We see a tremendous possibility there. And that is why we decided to team up. Our strategy specifically is to tackle these countries first before we enter into regulated markets.

About the Author

Author Details
Maribel Rios is managing editor of BioProcess International; [email protected]; 1-646-957-8884.

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