While the largest pharmaceutical companies account for the bulk of research and development spending and contract research revenues, expenditures by early-stage biopharmaceutical companies are vital to the health and viability of the contract research organization (CRO) industry. The comparative health of early-stage companies has lifted the entire CRO industry—including small and mid-size CROs—to a new level of robust activity and profitability. 

Early-stage biopharmaceutical companies have become especially important to the small- and mid-size CROs as the major pharmaceutical companies consolidate their supply base and limit their sourcing to a few preferred providers. Most small CROs don't qualify as preferred providers because their capabilities, especially their limited service networks and narrow therapeutic experience, are not broad enough to serve the multidisciplinary and large-scale needs of the major pharmaceutical companies. However, the capabilities of the smaller CROs are adequate for early-stage biopharmaceutical companies, which generally run smaller studies spread across fewer sites in fewer countries. More importantly, perhaps, the smaller CROs are willing to provide the hand-holding and close support that the less-experienced smaller companies need to get through the development process. 

This doesn't imply that large CROs ignore early-stage biopharmaceutical companies. Smaller companies account for 25–30% of the volume at most big CROs, and are valued because they offer better margins than big pharma projects while diversifying the client base. However, the major pharma companies are where the big money and largest pipelines are, and they are the principal targets of the largest CROs. 

CROs are benefiting from the big jump in new drug candidates driven by early-stage biopharmaceutical companies. Over the last five years, the number of Phase 1 drug development candidates has grown nearly 50%, and the number of Phase 2 candidates has jumped 25%. The great enabler of this flow of candidates from early-stage pharma has been venture capital (VC). 

The flow of venture capital has risen markedly in the past five years. Burrill and Company, the investment bank that specializes in the biotechnology industry, reports that VC investing in the biopharmaceutical industry reached $4.2 billion in 2006, up 50% from what it was in 2002. According to Ernst and Young, the biopharmaceutical industry now accounts for 18% of all VC investing, a level that has remained steady for the past three years. 

Venture capital insiders say that the flow of funds into biopharma is likely to continue. To a large degree, this is driven by the large amount of money available for investment. According to Dow Jones Venture Capital, US venture capital firms raised $24.3 billion in new funds in 2006, just below the $24.9 billion they raised in 2005. These amounts are well below the record sums raised at the peak of the dot-com boom, but are still large by historical standards. 

The mix of companies that get funded continues to evolve. In the late 1990s, venture capitalists favored companies offering genomic technologies and other discovery tools. In recent years, the trend has been toward companies with products in late development, including Phase 1 and 3. Those companies are attractive because they offer the most immediate promise of success, and because they can absorb larger amounts of capital. 

According to Nick Galakatos, managing director at Clarus Ventures, the pendulum is now swinging toward companies with early development candidates. This reflects the increased willingness of major pharmaceutical companies to enhance their development pipelines by buying early-stage companies or in-licensing their candidates. According to Galakatos, competition among major pharmaceutical companies for early development candidates has raised valuations to very attractive levels, and offers a viable alternative exit strategy to the initial public offering. 

The strong support for early stage companies has been a boon for CROs; in fact, it's almost too much of a good thing. The growth in the pipeline is resulting in severe capacity shortages in early development services, especially preclinical toxicology testing and clinical pharmacology (Phase 1). The shortages are increasing drug development costs and delaying development timelines.  

Reports from the annual meeting of the Society for Toxicology (SOT), held in March, indicate the problem. Analysts covering the meeting estimate that the preclinical services market is growing at the rate of 15 –20% per year, the fastest of any contract services sector. The growth is driven by the many candidates in early development and the increased willingness of major pharmaceutical companies to outsource their toxicology testing. Analyst reports note that increased demand from several major pharmaceutical companies (including Pfizer, which is closing several sites where preclinical testing is conducted) could overwhelm the market this year. 

Preclinical CROs are adding capacity, but this may not be fast enough to absorb growing demand. One analyst estimates that announced new facilities and expansion plans will increase capacity by 15–20%, but it will take another two to four years for that capacity to come on stream. Biopharmaceutical companies are investigating new sources of supply in Asia, but are finding that compliance with good laboratory practices (GLPs) and animal welfare practices are still not up to Western requirements. 

The capacity shortages are taking a toll on biopharmaceutical development efforts. Companies are being forced to reserve toxicology testing slots up to six months in advance, a long lead time for acute toxicology testing. Development budgets are being impacted by price increases of up to 5% annually.  

CROs are using the supply and  demand imbalance as leverage in negotiating long-term dedicated capacity deals with the major pharmaceutical companies. These deals are seldom good for the client, as they usually result in their paying for capacity they aren't using, but many companies are anxious to avoid the risk of not having access to preclinical capacity. 

Clinical research service providers are also enjoying strong demand for their services. Exhibitors at April's "Partnerships with CROs" conference expressed considerable satisfaction with the current state of their market. While the large, publicly-traded CROs are reporting record backlogs (expected future revenues based on signed contracts), the smaller CROs are reporting strong growth thanks to the early-stage companies and overflow from the large CROs. One indicator of the good times for the smaller CROs is the intense interest in the sector being shown by private equity investors, who are actively looking for acquisitions in the industry. 

For biopharmaceutical companies, however, the strong clinical CRO business has its costs. While there is no indication of an upward spiral in prices as yet, competition for key staff like site monitors is intense and costly. Further, patient recruitment has become very difficult, such that prolonged efforts to enroll patients are delaying the completion of trials. Another problem to watch out for: rapid growth at smaller CROs may outstrip their project management capabilities and the executive talents of their founders. 

The bottom line: good times for biopharma are translating into good times for the CRO industry. But if there is such a thing as "too much of a good thing," the CRO industry may soon experience it. 

is president of PharmSource Information Services, Springfield, VA, 703.383.4903, 

Articles

Columns and Departments

Venture capital insiders say that the flow of funds into biopharma shouldcontinue, driven by the large amount of money available for investment.

Outsourcing Insights: Booming Biopharma Pipeline Straining CRO Capacity

Some companies in the biopharmaceutical industry have considered and discarded their China strategy because they fear that intellectual property in China is unprotectable. This perception was recently bolstered by the formal World Trade Organization (WTO) complaint lodged this month by the USagainst China for counterfeit goods. Despite such actions, most analysts would agree that Chinese intellectual property laws and enforcement practices are changing rapidly. Companies not keeping abreast of changing policies may miss a significant opportunity.  

Many foreign companies have demonstrated growing confidence in the Chinese Intellectual Property Rights (IPR) systems by filing patents in China. Large biopharmaceutical companies are setting up R&D facilities in Shanghai and Beijing, including Novo Nordisk, Roche, Eli Lilly, and Pfizer. The recent entry of China into the WTO and the rise of China's economy have pushed the protection and enforcement of IPR to the front burner for China's authorities, who plan to become major international technology trading partners.

Yet, despite these rapid changes and improvements in IPR, 80% of US companies recently surveyed by AmCham-China

  have indicated China's IPR protection is "less than effective." Michael Wise of Perkins Coie outlines the background of IPR protection in China in his chapter in 

Advances in Biopharmaceutical Technology in China

Others see long-term opportunities. "China is on the verge of becoming a major technology and IP generator, creating a wave of patents likely to wash over the US and Europe's shores in the next decade," says Ian Harvey, chairman of the Intellectual Property Institute in London. "This is the result of China's recognition of the fundamental importance of IP to economic growth." Harvey believes this shift has largely been missed by foreign observers.  

According to Wise, intellectual property rights protection in modern China has had a history of little more than 25 years. The IPR history for pharmaceuticals is even shorter. China's current legal IPR framework began in the 1980s; however, in that short time, China has made impressive strides in protecting and enforcing IPR. By comparison, the United States has had a tradition of protecting intellectual property rights for over 200 years.  

China joined the World Intellectual Property Organization in June 1980 and began to enact laws toward the building of a modern Chinese IPR protection and enforcement system. In the same year, the Chinese Patent Office was established. In 1998 the name was changed to State Intellectual Property Office. The patent law of the People's Republic of China (PRC) was adopted in 1984 and the copyright law was enacted in 1990. In 1993 the law of the PRC against unfair competition was enacted, which provided a statutory basis for the protection of trade secrets. Before these laws were enacted, IPR protection in China was minimal. Although some scholars believe that legalized IPR protection started in China in 1882 when Emperor Guangxu of the Qiing Dynasty granted the first "patent," it was only in 1992 that the PRC patent law was amended to extend patent protection to drugs.  

Enforcement of IPR continues to be a major issue between China and the West today. China's central government is aware of the need to improve IPR protection and enforcement, but change cannot occur immediately in a country that has had such a limited history in IPR. 

Enforcement of IPR in China may involve either the courts or the administrative authorities. Court actions take more time and money, but they can award damages, whereas administrative authorities can issue fines and award damages based on a successful mediation. While the number of cases filed in Chinese courts involving IPR disputes has increased rapidly in recent years, administrative actions remain the preferred venue in many cases. Patent disputes are handled by intellectual property offices. Trademark disputes are handled by the industrial and commercial bureaus. Copyright disputes are handled by copyright bureaus. Customs can investigate and seize imported infringing goods. Because IPR violations in China may also result in criminal penalties, police departments are actively involved in IPR related crimes.  

The 1984 PRC patent law took over five years to draft. The drafters examined the patent laws of the US, Europe, and other countries for reference. In many aspects, the PRC patent law is similar to European patent law. The PRC patent law is a first-to-file system that awards patents to the first applicant to file for patent, which differs from the United States, which is a first-to-invent system. 

The 1984 PRC patent law was amended in 1992 to extend patent protection to drugs, which were previously excluded. Many blockbuster pharmaceutical and biotech drugs that were discovered, patented, or publicly disclosed before 1984 were not eligible for patent protection in China. Consequently, companies in China produced generic versions of these blockbuster drugs before generic versions became available outside of China. 

In 2000, amendments were adopted that further harmonized China's patent system with other countries in anticipation of China's joining the World Trade Organization. The implementation regulations of the PRC patent law were adopted in 2001 and amended in 2002. The PRC patent law provides that "no patent right shall be granted" for scientific discoveries, rules and methods for mental activities..."  

The PRC patent law also provides that creators of work-for-hire inventions should be compensated by their employers. "A state-owned enterprise or an institution" is required by law to pay an inventor no less than RMB2000 yuan ($250) for an invention patent.  

The number of patent applications filed with the patent office by domestic and foreign applicants has risen rapidly in recent years. It took 15 years for China to reach its first one millionth filed patent application. However, it took only four years for China to reach its second millionth filed patent application. The number of patent applications has increased at an annual rate of 20% from 1997 to 2005 (Figure 1). Of the total of 2,761,189 patent applications filed from 1985 to 2005, 81.8% were filed by Chinese applicants and 18.2% by foreign applicants. In 2005, the number of patent applications by Chinese applicants increased by 37.4% over 2004. The increase in patent filings by Chinese applicants reflects a recent trend in IP awareness and focus by Chinese companies. 

In 2005 alone, 214,003 patents were granted, of which 80% were granted to Chinese applicants and 20% to foreign applicants. On average, the number of patents granted by the patent office increased by about 20% per year between 1997 and 2005 (Figure 2).  

In the medicine and pharmaceutical area, the annual percentage increase in patent application filings with the patent office has recently grown by double digits.

 The number of pharmaceutical patent applications filed for Western medicine was 3,263 in 2003, with an average annual growth rate of 27.4%. The recent growth in patent application filings reflects increasing confidence in the current patent system and the prospect of future patent protection and enforcement. It was not long ago that early-stage biotech and pharmaceutical companies would not consider China a country in which to file a patent application. Given the rapid expansion of the Chinese economy and the recent focus on IPR protection and enforcement, filing patent applications in China has become far more important than it was five years ago. China should be considered as a potential country in which to file patent applications for any international patent portfolio (Figure 3). 

Chinese remedies for patent infringement are similar to US remedies. In a patent infringement case, the patentee may seek injunctive relief and monetary damages. However, unlike US plaintiffs, Chinese plaintiffs often demand a public apology for the infringing activities. Patent infringement damages may be calculated as lost profits of the patent holder or benefits gained by the infringer. If royalty payment references are unavailable, a court may award damages from 5,000 yuan (US $625) to 500,000 yuan (US $62,500).

 Since the damages awarded for patent infringement in China are insignificant compared with the millions of dollars routinely awarded in US patent cases, the lack of meaningful damages for patent infringement is a significant issue between the United States and China. 

Enforcing patent infringement judgments can be difficult in China due to local economic protectionism. If the defendant is a major employer in the region and produces significant tax revenues to the local government and the plaintiff has no operation in the city or province, the local government has no incentive to enforce the judgment against the defendant. If enforcement of the judgment would result in the closing of the business or severely curtail the success of the company, the local government may not cooperate in enforcing the judgment. This creates tension between the central government and the local government. The uncertainty in enforcement of judgments, in combination with the low damages available for relief, has discouraged many foreign companies from pursuing patent infringement actions in China. The lack of transparency in the Chinese court system and the interconnection of the parties further deter foreign companies from suing. Court decisions often are not published.  

  IP offices nationwide accepted 12,058 patent dispute cases, of which 10,411 cases (86.3%) were completed. In 2004 alone, the Chinese IP offices took on 1,455 patent dispute cases and uncovered 3,965 fake patent cases. 

IPR infringers in China may be subject to criminal penalties. From 1998 to 2004, 2,057 criminal cases were adjudicated in Chinese courts, and 2,375 individuals were convicted. According to the criminal law, "counterfeiting other people's patents" will, under "severe circumstances," result in either fines or up to three years of imprisonment or detention, or both. Criminal penalties for trade secret theft are punishable by either fines or up to three years of imprisonment or detention, or both. Trade secret theft causing damages of more than 2.5 million yuan (US $312,500) to the holder of the trade secrets is punishable by three to seven years of imprisonment. 

From 2000 to 2004, 2,533 suspects were arrested and 2,566 were charged by the prosecutors' offices for IPR crimes. In 2005, the police department investigated 1,799 cases and solved 1,470 cases (up 46% from 2004).  

Pfizer's Viagra patent case has received significant worldwide press. The patent claims the use of sildenafil citrate, the active ingredient of Viagra, for treatment of male erectile dysfunction. An invalidation proceeding joined by 12 domestic Chinese pharmaceutical companies was initiated in 2001. Nearly three years later, the reexamination board issued a decision declaring the patent invalid. Pfizer immediately appealed. In June 2006, the Beijing No. 1 Intermediate People's Court dismissed the reexamination board's invalidity decision and remanded the case to reevaluate the validity of the patent. An appeal was filed by the Chinese companies to reverse the decision. Without new evidence, it may be difficult for the Chinese companies to reverse the decision. The development of the Viagra case has been closely watched by Chinese and foreign companies as a test of China's IPR system. The Viagra case is an example of concerted efforts by Chinese companies to invalidate Chinese patents owned by a foreign pharmaceutical company. The fact that Chinese companies are monitoring and opposing the grant of Chinese patents demonstrates an increased awareness of other companies' IPR and a sophisticated IP strategy. Rather than simply ignoring Pfizer's patent, the Chinese companies challenged it in court. 

For a country with only 25 years of IPR protection tradition, China has come a long way. China is preparing a third round of amendments to the PRC patent law (to be finalized by 2008).

  These amendments have resulted from China's entry into the World Trade Organization (WTO). The proposed changes indicate that China is continuing to strengthen and harmonize its legal system for IPR protection. The shifts will likely include: 1) changes in the patent application process; 2) amendments regarding legal requirements for patentability; 3) amendments regarding the exemptions to patent infringement; 4) amendments to establish a special appellate court to handle IPR cases.  

IPR protection and enforcement are major issues for foreign companies contemplating doing business in China. The current IPR protection and enforcement in China are major issues in making decisions related to setting up operations in China that handle proprietary technology including R&D centers. 

According to Perkins Coie's Michael Wise, foreign entities conducting business or considering doing business in China should incorporate IP risk management strategies as a component of their business plan. If a company is to establish an R&D facility in China, emphasis should be placed on managing the IP asset leakage and protection. To prevent this, precautions should be taken such as using experienced IP professionals in establishing the facility, creating confidentiality policies, and training employees. The majority of employees in China have not been exposed to confidentiality policies, so the company should educate and train all the employees about these policies.  

An R&D company should aggressively seek patent protection for inventions made in the R&D facility in China. Despite the current limitations of IPR protection and enforcement in China, filing patent applications today may provide valuable IPR protection in years to come. Due to the brief history of patent protection in China and the differences between US patent law and the PRC patent law, many concepts are foreign to the Chinese, including Chinese patent attorneys.  

IPR protection in modern China has had a very brief history. Despite such a short timeframe, in that short time China has made impressive progress in protecting and enforcing IPR. China still has a long way to go. As the Chinese economy matures and China transitions from a manufacturing-based economy to a technology-based economy, IPR will become more important. The recent rise in patent application filings by domestic and foreign applicants bodes well for China and reflects an increased confidence in the future of patent protection and enforcement in China. The Chinese government is aware of the need to improve IPR protection and enforcement. The proposed third amendments to the PRC patent law will hopefully continue to improve the situation. The key question is when Chinese IPR protection and enforcement will meet international standards. 

That timeframe may be shorter than some anticipate. Novartis is investing US $100 million in its first comprehensive R&D center in Shanghai, Jeffrey Li, president of Novartis China, told reporters from China Pharmaceutical News, "Pharmaceutical R&D is...very sensitive to IPR issues. If a novel compound can get effective IP protection it may generate billion of dollars of profits...Novartis is fairly confident with China's IPR protection. We are voting [for China's IPR protection] with billions of dollars." 

Special thanks to Michael Wise, partner in the Los Angeles office of Perkins Coie, a member of the firm's intellectual property practice group, and chair of the firm's China intellectual property practice; Zhaohui Wang (Zoe), PhD, and James Zhu, PhD, senior patent associates at Perkins Coie (

is president of BioPlan Associates, Rockville, MD, 301.921.9074, 

China's central government is aware of the need to improve intellectual property protection and enforcement.

China Today: Intellectual Property Protection in China: Does it Warrant Worry?

The business climate for the pharmaceutical industry has changed significantly in the last decade. The realities of an increased emphasis on return on investment (ROI), downward pressures on pricing, and the imperative to provide greater value (higher quality at lower cost) have led members of the pharmaceutical industry to evaluate and implement technology-driven and business paradigms to maintain sustainable competitive advantage. 

One approach the industry has taken to "stay ahead of the red" has been to outsource discrete packages of work, especially when a company lacks in-house capability or cannot complete a task on time. Outsourcing has evolved from a workload capacity management solution to an increasingly strategic solution. It is now widely recognized in the pharmaceutical industry that mastering the industry's entire skill range is no longer a viable option— even for large companies. Organizations of all sizes now realize that specialist companies can, in fact, do things better. Outsourcing may be used to address entire drug development lifecycle needs (as is the case with virtual companies), or it may be used for a variety of activities along the drug development continuum. Factors that help determine whether operations can beneficially be outsourced include the following: host company expertise and capabilities, host company's business model, stage of drug development (Phase 1, 2, or 3), and service provider experience and expertise.   

Business process outsourcing (BPO)—the outsourcing of business activities required for the efficient operation of a company—has long been the mainstay of several industries, as functions such as accounting, purchasing, and information technology have been managed by external organizations. In the pharmaceutical industry, discrete packages of work, such as the generation of clinical supply materials for preclinical or clinical testing and manufacturing, have been outsourced. Outsourced manufacturing-related activities have typically focused on tactical operations and have included primary and secondary packaging, formulation, active pharmaceutical ingredient manufacturing, sterilization, and labeling. 

WHAT IS KNOWLEDGE PROCESS OUTSOURCING (KPO)?

With the evolution and maturity of outsourcing strategies, and the added comfort level that has come from successful tactical outsourcing, pharmaceutical companies are moving toward outsourcing high-end processes—and outsourcing them to offshore destinations. The offshoring of high-end, knowledge-intensive work is termed knowledge process outsourcing (KPO). 

KPO takes outsourcing to a higher level. Knowledge-based business processes are outsourced to locations and organizations that offer domain expertise, technical skills, and cost-effective operational efficiencies. Examples of KPO services include creating, sharing, maintaining, tracking, and disseminating knowledge across a variety of industry segments; these segments consist of pharmaceutical and biotech research and development, as well as market research, statistical analysis, financial services, and legal services. 

There has been a surge in KPO in the last few years as companies have recognized that high-end processes can be successfully outsourced with substantial cost savings. Incidentally, those organizations and locations that offer first-rate BPO services typically are in the best position to offer high-quality KPO services as well. The global KPO business of nearly $2 billion is estimated to reach $16 to $17 billion in the next five years. According to Evalueserve, low-end outsourcing services will grow globally from $7.7 billion in 2003 to $39.8 billion in 2010, implying a cumulative annual growth rate (CAGR) of 26%. In contrast, the estimated total revenue for the KPO market is expected to grow globally from $1.2 billion in 2003 to $17 billion in 2010, implying a CAGR of 46 percent.

Investment in KPO infrastructure will be higher compared to traditional BPO infrastructure investment. Companies evaluating offshoring opportunities typically consider the following broad parameters: infrastructure, processes and technology, human resources, credibility, front-end interfaces, and actual performance.

  Good infrastructure is essential, not only from the outsourcing partner, but also in the city or country where the KPO work will be undertaken. Assurance that macro-level infrastructure limitations will not, in any way, hamper operations is important. The partner under consideration should have appropriate delivery systems, in terms of quality standards, to support the processes and the technology. A high degree of expertise in specific areas, along with personnel for support functions, must be available. Credibility is a major issue when evaluating a potential partner; indeed, data integrity and employee credibility rate very high on the acceptance evaluation scale. Direct interface among partners is typically not an issue unless interactions involve a third-party KPO, in which case building trust, demonstrating credibility and domain expertise, working out the delivery model, and defining performance criteria play a critical role.  

POTENTIAL KPO PROJECTS IN THE PHARMACEUTICAL INDUSTRY

Pharmaceutical companies can reap considerable benefits from KPO. The drug pipeline is not as prodigious as it was during its heyday in 1996, when 53 new molecular entities (NME) were approved; indeed, there has been a so-called "approval  drought" in the last decade.

  The year 2006 saw the approval of only 18 NMEs (the same number as in 2005), and of only four biologic license applications (BLAs). Interestingly, the approval recipients were not the big biotech companies; they were either smaller, newer US biopharmaceutical or biotech companies, or large international pharmaceutical companies that were, in some cases, foreign-based.

The typical cost of drug development has been conservatively estimated to be $802 million (in 2000 dollars).

  In addition, the fact that 50% of new blockbuster drugs are next-in-class compounds does not provide highly differentiated therapeutic value to the industry. Today only one of six new drug prospects will likely deliver returns above its cost of capital. Drug-candidate screening and evaluation is extremely expensive, and even with the application of recent molecular and informatics tools, performance has not been stellar.  

Drug discovery and development KPO, taking into account specific skills afforded by a particular location, can significantly improve ROI. For example, India traditionally has been known for its experience in reverse engineering of  pharmaceuticals. Indian scientists have established a stronghold in the computer industry, and collaboration between the computer and pharmaceutical industries can stimulate drug discovery and development programs. 

Another area for KPO is data mining. The amount of information that pharmaceutical companies generate and collect during drug development doubles every five years; unfortunately, only 10% of that information is ever leveraged to improve overall competitiveness and compliance. Reportedly, most drug development organizations—regardless of size—are working with ad hoc or silo processes in which data are not captured consistently.

  Data transparency and traceability are imperative in the pharma industry; however, the tendency toward "tribal data capture"—storing data on individual desktops or servers—continues. It is time to do away with the old technology-enabled data management model and replace it with technology-enabled knowledge management. KPO can facilitate this transition. This change will enable "drill-down" capability-data access based on specific requirements such as date, project type, or phase—as well as "drill-across" capability, to develop relationships among processes, materials, and operating modes (good manufacturing processes versus not-so-good manufacturing processes, for example). Knowledge management will allow pharmaceutical companies to revisit NMEs not considered as first-tier candidates (and therefore not brought forward for further development) to determine if their potential should be further explored. Indeed, some pharmaceutical companies have licensed these "back burner" candidates to contract service organizations (CSOs) for further investigation and development. 

Table 1 provides examples of KPO services in the pharmaceutical industry. 

Table 1. Examples of knowledge process outsourcing			

ROLE OF RAPIDLY DEVELOPING ECONOMIES IN PHARMA OUTSOURCING

Outsourcing a process offshore does not rewrite the rules of outsourcing. Rapidly developing economies (RDEs) such as India and China offer sizable advantages and are underused by most companies. Many CSOs are increasingly using RDEs in their innovative processes. The general arguments for doing so are as follows: access to a vast pool of high-quality, low-cost technical talent (the labor-cost differential is large); round-the-clock, 24/7 workdays; potentially faster product development times; and better access to local markets—for example, India and China are the fastest-growing sources of demand in the world.  

Although many multinational companies have focused on India and China, other regions also being considered include Eastern Europe and Latin America. In a survey conducted by the Boston Consulting Group, approximately 45% of respondents indicated that their companies planned to increase research and development investments in China and India.

  The study also points out that although companies have planned allocations in RDEs, most firms are taking a cautious approach. The most popular target for increasing innovation spending in 2006 was North America; fully 60% of respondents said their companies planned to increase investments there. Western Europe, at 48%, was the second most popular location for increased innovation spending. 

As with any project, whether in- or outsourcing, good project management is vital. Effective business process and project management tools must be established. Quality standards also must be established and implemented at every step in the workflow. Typically, KPO will involve a high degree of information sharing and knowledge sharing; therefore, confidentiality, security infringement, intellectual property, and employee credibility are major concerns. 

One challenge in KPO management involves defining performance criteria. As KPO services involve deliverables for which it may not always be possible to assign exact specifications, managing expectations is critical. In addition, the following are essential: agreed-upon communication venues, avenues, and frequency; a balanced range of performance-assessment metrics; and the recognition that, at least initially, there may be a productivity lag until specific process knowledge is gained. 

Process ownership and task ownership together form another area for which clarification and upfront discussion are needed. Specifications for this area are typically included in the outsourcing contract. For example, for outsourced cell-line development and target protein-optimization projects, it is necessary to identify who owns the processes. 

The following case studies illustrate the importance of some of these concepts. 

A Japanese pharmaceutical firm acquired rights to develop and license a biopharmaceutical product in Japan while the product was entering Phase 1 testing in the US. As most of the analytical methods had not yet been fully developed when the license was granted, both companies worked together to develop characterization techniques. For the majority of the methods, the two companies pursued the same course and arrived at nearly identical procedures. However, in the case of the bioassay, the Japanese group used the cell line that had historically been used by researchers in the field, while the US company moved to a new cell line that had been reported in the literature as being more robust. The assay was complicated by the presence of a preservative in the drug product that caused cell death at high drug concentrations. 

Both groups were successful in developing an effective assay that measured the biological activity of the drug. Although either firm could have insisted that the other firm use its method, in the end good science prevailed and both methods were validated after demonstrating comparability. The take-home message here is that sound scientific methods should take precedence over individual opinions. 

CASE STUDY 2: OUTSOURCING SPECIALIZED SKILLS 

Years ago when a company wanted to develop a master cell bank, it had to obtain the starting DNA for the specific protein from a natural source. To change the amino acids or to improve expression, the development scientists would start with this gene and make point mutations to alter specific sites (today they almost always start with a synthesized gene). In addition to providing exact control over the sequence of amino acids to be produced, the increase in synthesis capability allows the company to optimize the sequence for other reasons. For example, they often choose to express a protein in a host different from the one in which they obtained the original DNA sequence; the desired host may favor certain codons for expression that differ from those found in the native sequence.

To increase expression levels, they go through a process of codon optimization. Several firms offer the specialized service of codon optimization based on the selected host cell line. Although it is possible to perform this work in-house, many firms outsource this function to an outside provider. This is an example of KPO; rather than developing this narrow but highly specialized skill in-house, the company in question works with an outside group that has invested the resources to add knowledge value. 

To create value, both in the short and long terms, pharmaceutical companies need to see the big picture and build an integrated strategy that balances the advantages against the potential risks from offshoring. KPO entails shifting from simple execution of standardized processes to carrying out processes that demand advanced analytical and technical skills as well as decisive judgment. KPO projects are typically marked by a higher level of control, confidentiality, and enhanced risk management. Laxity in any of these parameters can jeopardize or nullify the expected strategic value. 

Current outsourcing practices of many pharmaceutical companies are overly conservative, and project management practices are sub-optimal. As the Boston Consulting Group concluded in a recent report, 

Looking Eastward: Tapping China and India to Reinvigorate the Global Biopharmaceutical Industry

, companies that carefully implement an integrated and deliberate strategy will have the greatest advantage in the future.

is president of GAEA Resources, Inc., Northport, NY, 631.261.4665, 

is founder and CEO of Strategic Manufacturing Worldwide, Saratoga, CA, 408.420.5352, 

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2. Knowledge process outsourcing—An emerging opportunity. Gurgaon, India: Kelly Services; 2006. 

4. Owens J. 2006 drug approvals: Finding the niche. Nature Reviews Drug Discovery. 2007 Feb;99–101.  

5. DiMasi JA, Hansen RW, Grabowski HG. The price of innovation: new estimates of drug development costs. J Health Econ. 2003 Mar;22(2):151–185. 

 6. Morris K, Venugopal S, Eckstut M. Making the most of drug development data. PharmaManufacturing. 2005 November 30;4(10):16–23. 

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www.dnatwopointo.com/commerce/misc/opt.jsp

 9. Looking eastward: Tapping China and India to reinvigorate the global biopharmaceutical industry. Boston MA: Boston Consulting Group: 2006. 

Features

By outsourcing high-end processes that demand advanced analytical and technical skills, biopharm companies are reaping substantial savings.

Outsourcing: Transition from Business Process Outsourcing to Knowledge Process Outsourcing

A purification process scheme was developed to purify therapeutic-grade human monoclonal antibodies. It features two columns with interchangeable chromatography steps and non-affinity resins. The purification scheme includes a cation exchange column (CEX) and a hydrophobic charge induction (HCI) column and eliminates the need of an in-process diafiltration step. Viral clearance from this scheme is efficient due to the ability of HCI resin to remove adventitious agents. The scheme was scaled up 1,000- to 10,000-fold with an average overall yield >70% for a variety of antibodies. Contaminant removal and product quality from this process are comparable to those of three-column affinity and non-affinity purification schemes. 

The economics of large-scale purification of proteins is important, especially for therapeutic antibodies. Antibodies make up a large percentage of the therapeutic biologics on the market, accounting for about 30% of total recombinant protein product sales. Revenues for 20 approved therapeutic antibodies are estimated to be about $17 billion in 2006, and expected to be over $22 billion in 2007.

  Costs associated with antibody-based therapies tend to be particularly high because these are expensive molecules to develop, produce, and often require high doses. 

The purification scheme is very important for both final product quality and process economics, because chromatography alone can account for two thirds of downstream processing costs. When the products are monoclonal antibodies, the resin cost for an affinity-capture column such as Protein A can overwhelm the raw materials costs.

Affinity chromatography often is used as a capture step to meet purity, yield, and throughput requirements, despite the development of advanced chromatography resins with improved performance at high flow rates and binding capacity. Traditionally, the affinity-based capture step (Protein A or G) is followed by at least one or two other chromatography steps. In addition, one or more in-process diafiltration steps are needed to condition the feed into the following column. Not only is Protein A resin at least four to five times more expensive than non-affinity media, it can also have issues such as ligand leaching. In general, even if affinity chromatography is used, adequate purity and viral clearance often are not achieved unless one or more polishing steps are interspersed. 

By eliminating specific steps in downstream processing, productivity can be maximized while maintaining the integrity and purity of the molecule. We describe here a flexible, interchangeable, non-affinity, two-step purification method that can be implemented at lower cost compared to affinity-based schemes due to its simplicity and short number of steps involved. Overall recovery is high and final product quality is equivalent to more traditional protocols. 

Not only did we reduce the number of steps with the proposed purification process, but we also eliminate the need for an in-process concentration or diafiltration (which would mean more development, optimization, scale-up, cleaning and cleaning validation, and increased process cost while risking potential loss or modification of product). Minimizing the number of steps will cut down the number of process components, buffers, tanks, and miscellaneous equipment. Finally, the two-column purification process can be readily implemented into the clinical manufacturing of many antibody molecules with less initial investment on development cost, time, and resource requirements.  

This purification process explores the integration of the separation principles of two different resins, a cation exchange (CEX) resin (Poros 50HS or Fractogel EMD SE HiCap) and a hydrophobic charge induction (HCI) resin (MEP HyperCel). The proposed scheme adapts to different feed types and user implementation choices, while still clearing host cell proteins (HCPs), viral-like particles, nucleic acids, product-related contaminants, and media additives (e.g., methatrexate, insulin, vitamins) to levels that allow the therapeutic use of the final purified material. 

This process is highly flexible because the material can flow either way. The CEX and the HCI resins can be used for either capture or a polish step, without any need for an in-process tangential flow filtration (TFF). Using CEX chromatography for capture takes advantage of the higher pI of human antibodies (typically higher than 8), which allows their capture or binding at a pH close to neutral (Ex. 6.2). The HCI resin can accommodate a wide range of conductivity values, provided that the pH of the load is maintained close to or above neutral. The viral inactivation step can be implemented between chromatography steps or after the second column. The convenient place to carry out viral filtration is at the end of the process, before product formulation, when volumes are smaller, more manageable, and the product is fully purified. This method has proven to be scalable (from about 1 mL to 10,000 mL column size, when CEX was used for capture) with reproducible results for different human antibodies.  

The unique properties of MEP HyperCel (Pall Corp., East Hills, NY) make process simplification possible. MEP HyperCel, a HCI-based resin is dependent on binding pH (neutral and above) but is independent of the conductivity of the load (up to 1 M NaCl equivalent). This is what makes it extremely flexible. When MEP HyperCel is used for capture, the resin is insensitive to the high conductivity of the cell culture supernatant, allowing straight loading of the harvest. Pre-conditioning the feed during the recovery TFF can extend the life of the resin as a capture step.  

The tolerance of MEP HyperCel to a wide range of conductivity during sample load is particularly useful when fed a neutralized CEX eluate. Consequently, this resin allowed for interchangeability in the proposed purification scheme because it can be applied either to capture or polish.  

An additional benefit provided by this resin is seen during elution. As the pH is reduced, product is recovered due to electrostatic repulsion between the ligand and the antibody, and conductivity has no significant influence in this elution process. Therefore, when MEP HyperCel resin is used for capture, the eluate can be collected at low conductivity to allow for effective binding onto the CEX column. Consequently, product can flow directly from the HCI column to the CEX column without needing any in-process TFF. As a polishing step, there is more flexibility in the conductivity of the elution buffer, because HCI is now the final chromatography step. In addition, MEP Hypercel can be viewed as both an alternative to TFF and a chromatography step. An interesting option would be to use the formulation buffer when HCI is being used as a polish.   

Several studies were performed on the HCI protocol to minimize HCPs during elution. Decreasing the conductivity during elution and increasing the elution pH from 3–4 to 4.8–5.2 favored a preferential elution of the product with a minimal relative amount of HCPs during a capture chromatography study (Figure 1). Also, we achieved higher purity by decreasing the elution flow rate (Figure 2). Other parameters such as elution at low conductivity and post-load washes with phosphate buffers also helped to  exclude HCP from the purified antibody. 

Finally, we observed that the binding capacity of this resin can be manipulated not only by the product's residence time in the column, but also by manipulating buffer species during equilibration and load. For example, when the strength of phosphate-based buffers was reduced from 35 mM to 10 mM, binding capacity was increased by about 170%, from 13 mg/mL to 22 mg/mL, for a specific antibody. 

Cell culture supernatant containing fully human monoclonal antibodies was concentrated and diafiltered in either 35 or 70 mM sodium phosphate (pH 6.2). For experiments in which MEP HyperCel was used as the capture resin, the load was adjusted to neutral pH prior to load. 

Antibodies were loaded onto CEX resins with a binding capacity ranging from 15 to 45 mg/mL. However, these capacity values can be further increased to over 100 mg/mL with higher binding resins. The product was step-eluted at pH 6.2 with added salt, ranging from 40 to 75 mM NaCl. MEP HyperCel (Pall Corp., East Hills, NY) was the HCI resin. Equilibration used 10, 35, or 70 mM sodium phosphate (pH 7.0 to 7.2) and the product was loaded to a capacity of up to 22 mg/mL. The resin was post-load washed with 10 to 45 mM sodium phosphate (pH 6.2 to 7.0) and then washed before elution with a low conductivity buffer. Elution took place when buffers with a pH range of 4.5–5.2 were used, using another low conductivity buffer such as 10 mM sodium acetate or a dual acetate and phosphate buffer. A summary scheme of the proposed method can be seen in Figure 3. 

Viral inactivation, filtration, and clearance studies

Low pH hold was performed for one hour. Final viral filtration used Planova 20N (Asahi Kasei Pharma, Westbury, NY). Viral clearance studies were performed by an independent laboratory (Apptec, St. Paul, MN). 

Host cell protein and DNA specific concentration 

Chinese hamster ovary-host cell protein (CHO HCP) analysis used Cygnus Technologies ELISA Kit (Catalog# F015). DNA was quantified by a proprietary qPCR assay.  

Both versions A and B of the purification process yielded comparable quality in the final purified material. With similar materials and the two interchangeable sequences, we achieved a final homogeneous composition containing less than 100 ppm in CHO HCP, 10 pg DNA/mg antibody, and a monomer percentage >95%, measured by size exlcusion HPLC.  

Table 1A summarizes the results obtained for A scheme when CEX chromatography is used for capture. This "direction" was adopted with four different antibodies. Host cell protein content was reduced 50- to 200-fold after the first column, with concentrations ranging from about 900 to 6,000 ng/mg, which were reduced to levels less than 100 ng/mg after the HCI column. The CEX resin cleared DNA very efficiently (as much as 7,000-fold), and remaining traces were further reduced by the HCI resin to less than 10 pg DNA/mg antibody. 

Table 1A and 1B.  Summary of in-process contaminant clearance. In Table 1A, a cation exchange (CEX) resin is used for capture, and hydrophobic charge-induced (HCI) resin is used for polishing. In Table 1B the resins were reversed.			

The reverse scheme (B) yielded a comparable quality of material (Table 1B). HCP was reduced about 90-fold by the HCI. DNA was cleared much more efficiently, when compared with the CEX resin as capture, bringing the measurements below the set final specification, which emphasizes the efficiency of MEP HyperCel in the clearance of nucleic acids.  

Final purity (% monomer) and overall recovery for both HuMAb-1 and HuMAb-2 purification schemes, in both directions, were extremely comparable: over 99% and approximately 70%, respectively. 

Table 2 summarizes the scalability of the proposed process for two other human monoclonal antibodies. The largest variability was observed with the DNA measurements. All remaining parameters were very comparable. Final purified material retained the quality obtained at bench-scale. Recovery values tended to be better with scale-up. 

Table 2. Comparison of in-process contaminant clearance using the cation exchange (CEX) resin for capture and a hydrophobic charge induction (HCI) resin (MEP HyperCel) for polish as the process is scaled-up. The overall yield for HuMAb-6 and HuMAb-7 for large-scale process was about 80% for both antibodies.			

Regulatory agencies require at least two separate steps for viral inactivation and clearance during the production of therapeutic proteins. These steps must be based on different  modes of action, typically, a low pH hold and a viral filtration step.

  Viral inactivation was conveniently positioned between the chromatography steps, but this step can also be positioned at the end of both sequences. Similarly, an additional specific step, such as viral clearance filtration, is performed after the second column. 

Table 3 shows the viral clearance of HuMAb-6 and HuMAb-7 following scheme A. Quantification of virus-like particles in the cell culture supernatant yielded up to 10 logs of infectious and non-infectious viral particles. The minimum safety factor for clearance of A-MuLV for the process ranged between 7 and 10 logs, for HuMAb-6 and HuMAb-7, respectively. Therefore, the final antibody product (antibody and residual process contaminants) had sufficient viral clearance and safety viral factor, allowing its use as a therapeutic. 

Table 3. A-MuLV clearance capacity of the purification process using a cation exchange resin for capture and hydrophobic charge induction resin for polish. Results were estimated from bench-scale runs.			

With increasing titers in antibody manufacturing, purification processes must increase process efficiency and productivity. By minimizing the number of purification process steps, the number of buffers to be prepared and process components are also reduced. The two-column purification technology design described here can be used with various types of proteins with only minor process adjustments. The scheme is a starting point for subsequent optimization and iteration steps because chromatography parameters often can be optimized, for example, for higher binding capacity ranges. One additional advantage of using this scheme is the flexibility of choosing the direction of the process steps that is most convenient for a specific product or production facility. 

is the director of process development, all at Medarex, Inc., 908.479.2451, 

 1. Rathin D and Morrow, KJ Jr. Progress in antibody therapeutics. Am Biotechnol Lab. 2006; 24(8):8–10. 

This flexible setup minimizes the number of purification process steps, buffers, and process components.

Chromatography: A Two-Column Process To Purify Antibodies Without Protein A

The μ24 bioreactor from Applikon offers a platform for fermentation in a very small volume. Based on a micro-titerplate (24 wells), each well (reactor) has a working volume of 2–6 mL. Each reactor has its own pH and temperature measurement and control capabilities. The agitation (orbital shaking) can be controlled in the range 0–800 rpm. The bioreactor is completely automated and all data (per reactor) are visible on the screen of a PC and stored.  

Millipore Corporation's high shear HS T10 mixer has a small size that makes it ideal for use in small production-scale processes and pilot plants. The HS T10 continues to offer the same advantages that characterize the NovAseptic mixers. The magnetically-coupled design means that there is no shaft led through the tank wall. Total integrity of the tank is maintained and there is no risk of contamination. The mixers are bottom-mounted which allows for low level mixing and easy maintenance. 

BioProfile FLEX, an automated modular analyzer from Nova Biomedical, provides fast, comprehensive analysis for cell culture processing.  It offers up to 16 key cell culture attributes, including glucose, lactate, glutamine, glutamate, ammonium, pH, sodium, potassium, calcium, osmolality, cell density and viability, and phosphate or total protein in a single workstation. This comprehensive test menu provides immediate access to the critical information required to optimize product quality and yield. 

The Biostat Cultibag is a disposable bioreactor from Sartorious which combines rocking motion mixing technology with Sartorius engineered-control capabilities. The Cultibag is used for any disposable applications, and in particular cultivation of cells in batch, fed batch, and perfusion operation. The hardware is available in application driven packages inclusive of data logging software. For basic cell growth the basic packages provide temperature, rocking rate, and angle control with integrated air pump or connection to your own gas supply. 

New Brunswick Scientific's BioFlo 415 benchtop fermentor provides the convenience of automatic sterilization in place, with no need for an external steam supply. The advanced system uses only the lab's water and the unit's built in heater to provide rapid heat up and cool down. This cGMP-compliant, validatable fermentor is capable of controlling up to 32 process loops, including multiple Thermal Mass Flow Controllers as well as signals from up to ten external scales, analyzers, sensors, or other devices, for optimized process yields. 

Prionex is the BSA and HSA alternative from Centerchem. In protein stabilization, Prionex maintains the activity of proteins and enzymes during heat denaturation, lyophilization, and in long-term storage studies. It can be used in assay procedures to prevent non-specific binding and as an additive in cell culture. Unlike BSA, Prionex is safe and easy to work with. It is water soluble, consistent from lot-to-lot, non-antigenic, additive, and prion-free. Prionex is only available as a 10% solution in 100 mL and 1 L containers. 

Advanced Biotechnologies Incorporated offers a wide range of inventoried and custom-produced purified viruses and viral lysates for the Research and IVD community. The company recently added Human Influenza A/2/Japan/305/57 to its current influenza products APR8 and B/Lee/40. 

Lancaster Laboratories provides analytical services in chemistry and microbiology to the pharmaceutical and biopharmaceutical industries. Chief biopharmaceutical testing services include cell based assays, ELISA, nucleic acid analysis, PCR, cell line manufacturing, cell line testing, viral safety, viral clearance, biochromatography, electrophoresis, mass spectrometry, protein quantitation, and support for facility and process validation. The company's 175,000 square-foot facility is equipped with state-of-the-art technology and instrumentation. 

The ?-24 bioreactor from Applikon offers a platform for fermentation in a very small volume. Based on a micro-titerplate (24 wells), each well (reactor) has a working volume of 2–6 mL. Each reactor has its own pH and temperature measurement and control capabilities. The agitation (orbital shaking) can be controlled in the range 0–800 rpm. The bioreactor is completely automated and all data (per reactor) are visible on the screen of a PC and stored. Applikon Inc., 650.578.1396, www.applikon.com.

New Technology Showcase

The bioprocessing industry is increasing its use of membrane chromatography technology, especially for contaminant removal. The high flow rates, ease of use, disposability, and relatively low cost make it ideal for polishing applications. In a case study from Avecia Biotechnology, UK, the Sartobind Q (Sartorius) membrane chromatography product was used to remove endotoxin from a process stream. The result demonstrated advantages in time, product recovery, and cost over a traditional column step, leading to its use in a cGMP manufacturing process.  

In biopharmaceutical manufacturing, it is essential that any products intended for injection into human subjects are produced virtually free of potentially harmful contaminants such as endotoxins and viruses. To ensure this, manufacturers incorporate certain contaminant removal steps into their processing procedures. 

Endotoxins are typically associated with Gram negative bacteria, e.g., 

. As the prefix "endo" suggests, this type of contaminant is not secreted by bacteria (as are exotoxins), but derives from the structure of the bacteria, specifically, from part of the outer monolayer of the outer membrane.

  When bacteria are lysed, whether intentionally or as a side effect of the process, they release these structural components.  

Introducing even small amounts of certain endotoxins (e.g., lipopolysaccharides or LPS) into the bloodstream can cause a severe immune reaction. The presence of endotoxins triggers the immune system's signaling cascade, leading to the secretion of cytokines. The subject develops an abnormally high body temperature and respiration rate and low blood pressure. This can lead to endotoxic shock, which may be fatal. Therefore, it is essential to develop a robust process step to remove endotoxins from the process stream. 

One mode of separating the target substance from endotoxin molecules is by size exclusion via ultrafiltration. But this requires a significant difference in size between the target molecule and the endotoxin, as when the target substance is a nucleotide. In this case, the smaller target molecule passes through the membrane while the endotoxin is retained. Often, however, the target molecule and the endotoxin molecule fall into a similar size range, so separation based on size exclusion is not applicable. The size of endotoxin molecules can range from <10 kDa in a monomeric form to >10,000 kDa in an aggregated form.

An alternative mode of endotoxin removal is separation based on charge. This is possible because of the strong negative charge associated with endotoxin molecules under conditions around pH 8.0. This charged state is a result of the ethanolamine part of the endotoxin molecule having no charge at this pH, whereas the lipid-A and core polysaccharide regions are negatively charged at pH 8.0.  

Column chromatography is commonly used to take advantage of charge as a tool for separating proteins. In this process, a micro-porous stationary phase, conventionally a gel or resin consisting of agarose or cellulose beads, is packed into a tube or column of glass or stainless steel. By coating the stationary phase with anionic groups (ion-exchange chromatography), it is possible to selectively adsorb certain charged components of a process stream, depending on the conditions of the mobile phase. For example, under the conditions of low conductivity (<20 mS/cm

 ) and pH around 8.0, certain molecules (including endotoxin) have a net negative charge, and therefore, will bind to a positively charged stationary phase. Thus, they are retained in the column (removing them from the process stream), while the non-binding (target substance) molecules pass through the column. The outcome is a significant reduction of endotoxin levels in the process stream. 

Such resin and column-based chromatography systems, however, suffer from drawbacks such as low flow rates, the need to pack the column with stationary phase, long regeneration times, channeling, and susceptibility to fouling.

  In the context of contaminant removal (i.e., binding impurities rather than binding target proteins), these drawbacks become more of an issue. Because contaminant removal is usually a "polishing" step, flow rates and convenience are priorities, and these are not strengths for resin or column chromatography. Even with relatively low levels of contaminant in the process stream, low flow rates mean that conventional resin-based columns might need to be quite large, thus further raising costs.

To overcome these disadvantages, process specialists have been focusing increasing attention on the developing area of membrane-based chromatography. Membrane adsorbers, as they are often known, work on exactly the same principles as resin-based chromatography systems, with the ligand (e.g., quaternary ammonium) being bound to a support medium. In principle, any ligand that can be bound to a chromatography resin can be bound to a support medium, in this case a membrane.  

One major difference between a membrane support and a resin support is porosity. Membrane adsorbers in ion-exchange membranes typically have a pore size of >3 μm. This nearly eliminates the diffusion limitation, improving flow rates and chromatographic kinetics. The near absence of pore diffusion means that with membrane-based ion-exchange modules, there is a significant level of flexibility in flow rate selection.  

The open structure of the membrane is obvious when visually compared with a conventional bead of approximately 90 μm in size (Figure 1). 

Because membrane chromatography capsules are single-use, they are simple to use. Once the module is installed and flushed with buffer, processing can begin. Once processing is completed, the module is removed and disposed of, without the need for washing, eluting, cleaning, or regenerating. This yields a significant reduction in processing time and buffer volumes.  

With the increasing emphasis on reducing development times and costs, membrane chromatography products are being used in more and more cGMP processes. 

APPLICATION OF MEMBRANE CHROMATOGRAPHY FOR PROTEIN PURIFICATION

The UK contract manufacturer Avecia Biotechnology successfully applied membrane adsorption in a cGMP process involving the manufacture of B2365, a recombinant protein produced in 

. The B2365 protein is initially expressed as a fusion protein and purified from the bacterial lysate by affinity chromatography. The fusion protein is then immobilized onto glutathione sepharose affinity chromatography media. The column is subsequently washed to remove the bulk of the impurities. Once washed, the immobilized glutathione-S-transferase (GST)-B2365 protein is cleaved from the column using a GST-3C protease, which also binds to the column, allowing the cleaved B2365 molecule to be washed from the column, leaving both the GST tag and GST-3C protease immobilized on the column. Although B2365 is of high purity after this single step, it is then further purified in a polishing chromatography step to remove free GST that may have leached from the column.  

Previously, Avecia had purchased the GST-3C enzyme from an outside vendor, but to reduce overhead costs and to be able to certify the origins of the protease as non-animal-derived and free of transmissible spongiform encephalopathies (TSE), an internal project arose with the remit of producing 400 g of    GST-3C protease for subsequent B2365 manufacture. GST-3C protease is a genetically engineered fusion protein expressed in 

 20,000 human rhinovirus 3C protease coupled with a M

 26,000 GST tag. This protease was specifically designed to facilitate removal of the protease by allowing simultaneous protease immobilization and cleavage of GST fusion proteins on glutathione sepharose chromatography media. GST-3C protease specifically cleaves between the Gln and Gly residues of the recognition sequence of LeuGluValLeuPheGln/GlyPro. 

Exploiting the GST tag for purification using glutathione sepharose affinity chromatography resulted in rapid purification and high purity levels after a single purification step. This constituted a quick and easy purification strategy, but analysis of the column eluate indicated, not unexpectedly, that the endotoxin level was extremely high.  

A number of options were explored to reduce the endotoxin level, including anion exchange column chromatography and membrane chromatography. After small-scale laboratory work it was quickly determined that membrane chromatography technology would offer significant advantage with regards to product recovery, time saving, and equipment requirements during manufacture. A small-scale trial was performed using a Sartobind MA75 (2.1 mL bed volume) membrane adsorber (Sartorius). Under these conditions the membrane adsorber provided good performance in terms of product recovery and product flow rates. From the data generated the membrane was scaled-up for use within a 100 L scale process to a membrane bed volume of 70 mL,  or a 5-in. capsule.   

 Before GMP manufacture, a 100 L process demonstration batch was performed to assess the feasibility of the process. First, the fermentation broth was high-speed centrifuged to separate the cells from the basal media. The cell paste was then resuspended in a controlled buffered solution before high-pressure homogenization. The bacterial lysate was then 0.22-μm filtered before application to the chromatography column.   

A sample of the column eluate was taken for endotoxin analysis, giving a value of 42,900 EU/mL. The bulk-process solution was then passed through the membrane adsorption capsule  with further samples being taken at 5-L intervals for endotoxin analysis to model the capsule's clearing capacity. Once passed through the capsule, the GST-3C protease was then concentrated to 5 g/L and diafiltered into a final formulation buffer. The final product was then filtered prior to long- term storage at -70 °C. The endotoxin removal profile is shown in Figure 2.  

Using the data obtained from the process demonstration batch, the membrane adsorber capsule was resized prior to the GMP manufacture to a 20-in. (360-mL bed volume) capsule. During November 2005, two 100-L cGMP batches were performed under the same processing conditions as the process demonstration batch, except that the column eluate was then passed through a 20-in. Sartobind SingleSep (single use) capsule. The results from the endotoxin removal step are shown in Table 1. 

Table 1. Data from the Sartobind Membrane chromatography process step from two separate batches			

The use of disposable-membrane adsorption technology instead of traditional column  chromatography greatly reduced plant preparation time, because the requirement for  column packing, assessment, and sanitization, was removed, along with the associated documentation, equipment, and QC testing required to perform column chromatography. From the two batches of the cGMP manufacturing project, a total of 415 g GST-3C protease was produced, with significant cost savings. Final product analysis can be seen in Table 2.  

Table 2. Batch data from the final product, from two separate batches			

is a senior purification scientist at Eden Biodesign; 

is a purification specialist at Sartorius Biotechnology, Ltd., +44. (0).1372.737.159, 

1. Alberts B et al. Molecular biology of the cell. Garland Publishing, Inc., New York: 1983. 

2. Belanich M et al. Reduction of endotoxin in a  protein mixture using strong anion-exchange membrane absorption. Pharm Technol. 1996; March;142–5. 

3. The Sartorius group. Endotoxin removal, ion exchange chromatography with Sartobind membrane adsorbers. Application note. Gottingen, Germany: Sartorius. 

4. Gottschalk U, Fischer-Früehholz S, Reif, O. Membrane adsorbers: a cutting edge process technology at the threshold. Bioprocess Int. 2004; May;2(5):56–65. 

5. Fischer-Früehholz, S. Membrane adsorbers part 1: new dimensions in chromatographic purification. GIT Lab J. 2005;2:53 –5. 

Membrane-based chromatography technologies sometimes offer advantages over resin-based technologies.

Separation & Purification: Endotoxin Reduction Using Disposable Membrane Adsorption Technology in cGMP Manufacturing

The ability of modern analytical techniques to ensure that generic or follow-on versions of biotech therapies are comparable to the innovator product is emerging as a key issue for shaping a legal pathway to bring these products to market. Generic drug makers, as well as some biotech firms, want Congress to authorize the US Food and Drug Administration to approve similar biologics based on an abbreviated application that draws on test data developed by the innovator firm. The Hatch-Waxman Act established such a process for conventional drugs in 1984, but it does not apply to biologics regulated by the Public Health Service Act. Now many companies claim they have the science and the skill to document the comparability and safety of large molecules and are pressing to overcome the legal obstacles.  

To protect markets and preserve R&D incentives, brand manufacturers insist that all follow-on biologics require additional testing to assess immunogenicity and ensure product safety. Even then, follow-ons might not be interchangeable with brands, making them harder for patients to obtain. The debate is heating up as momentum builds for authorizing follow-on biologics or proteins (as FDA prefers) in order to reduce spending on costly biotech therapies. Innovator companies want to keep the issue from blocking speedy reauthorization of the prescription drug user fee program, making compromise more likely.  

All sides agree that science should determine the scope of follow-on testing, but there is considerable dispute over where the science stands. Generics makers maintain that advances in analytical testing can ensure follow-on comparability and safety. "Our ability to make and characterize protein products and other complex biologics has progressed rapidly in the last few decades," said Ajaz Hussain, a vice president at Sandoz and a former FDA official, in testimony before the Senate Health committee in early March.  

Small biotech and testing companies, moreover, are developing new scientific approaches for developing biogenerics, such as a protein characterization platform described by Insmed resident Geoffrey Allan at a subsequent hearing held by the House Oversight and Government Reform Committee. These manufacturers believe that comparability protocols provide a model for follow-on development and evaluation. FDA allows innovators to use mass spectroscopy and other technologies to demonstrate that significant manufacturing changes and moves to new plants yield revised products that are essentially the same as the original therapy.  

At the House hearing, FDA Deputy Commissioner Janet Woodcock explained that the agency has been limiting the range of data needed to document comparability following manufacturing changes in order to encourage companies to make continuous improvements in manufacturing processes. But she also noted a need for full information on structural aspects of a protein as well as a full understanding of the product's mode of action to predict clinical comparability. A new manufacturer would not have all the information about the innovator's intermediate manufacturing steps, Woodcock explained, and would bear the burden of demonstrating that a similar therapy from a different company works the same as the reference product.  

The information provided by analytical testing is important in determining whether additional clinical trails are necessary to bring a follow-on to market. Biotech manufacturers maintain that only extensive comparison studies can rule out clinically significant differences, but FDA says the extent of additional studies should be based on the complexity of the product and its clinical use and experience. At the Senate hearing, former FDA official Jay Siegel, now at Johnson & Johnson, described how a seemingly minor formulation change involving the stabilizer for Eprex (erythropoietin) increased immunogenicity and led to a serious red cell aplasia in patients.  

"Some degree of clinical assessment of a new product's immunogenic potential will ordinarily be needed," said Woodcock. But this could range from small pharmacokinetic (PK) studies to larger randomized trials. FDA required additional clinical testing for Sandoz' Omnitrope follow-on, but not as much as for the innovator.  

Moreover, clinical trials are not always the best way to assess product structural changes, according to some experts. While FDA may ask for additional PK studies to evaluate differences following manufacturing changes, the agency seldom requires large outcomes studies. And if trials are not needed, Woodcock commented, it may be unethical to require them. 

The information provided by analytical testing is important in determining whether additional clinical trails are necessary to bring a follow-on to market.

BioPharm International-05-01-2007

Outsourcing Insights: Booming Biopharma Pipeline Straining CRO Capacity

China Today: Intellectual Property Protection in China: Does it Warrant Worry?

Outsourcing: Transition from Business Process Outsourcing to Knowledge Process Outsourcing

Chromatography: A Two-Column Process To Purify Antibodies Without Protein A

New Technology Showcase

Separation & Purification: Endotoxin Reduction Using Disposable Membrane Adsorption Technology in cGMP Manufacturing

Regulatory Beat: Campaign Accelerates for Follow-on Biologics

Final Word: Political Will is the Backbone of Regulation Enforcement

From the Editor: Score One for Preparedness