Scott Houlton
President of Development and Clinical Services Business Unit
Catalent Pharma Solutions
1. When is the China facility projected to open?
We are completing construction and getting ready to start validation. The facility will be open for business by the end of September.
2. How many will be employed at the new facility?
We’ve already brought great talent into the organization in China. The number of employees will depend on uptake and volume; the starting level will probably be just under 20 people or so by the end of this calendar year. As business picks up, we will be increasing the head count.
3. What will differentiate Catalent’s facility from other clinical trials suppliers in China?
This is the first full service clinical packaging facility located in China. Other companies offer depot services but no one is really focused on full turnkey solutions of packaging and labeling. Catalent is committed to expanding our global network to support clinical trials and providing a full range of services.
4. How will opening this facility better serve Catalent’s customers? What solutions and services will be provided?
Most of the customer base that we’re serving is mainly large or mid-tier Pharma companies running global clinical trials that are looking to support China enrollment or the broader Asian market. As the market continues to grow and demand increases, it makes sense for us to have a full service offering that will split the packaging of global clinical trials by region.
We also chose to locate our facility within the Shanghai free trade zone which offers us greater flexibility in bringing materials in quickly and getting them ready for distribution. It will also facilitate the movement of materials into other countries in the region.
The clinical supply facility that we’re establishing in China is obviously happening at the same time as Catalent’s softgel business unit enters the market with local manufacturing capabilities. With the clinical supply site in China, we’ll be able to support some of the softgel facility’s needs in that region. This provides more manufacturing for our customers’ growth platform.
5. How will Catalent address challenges associated with ever-changing Chinese regulations?
As with any regulated market or industry, staying abreast of the regulations is important. We’ve already established relationships with the CFDA in China. We’ve considered the regulatory landscape in selecting the location and design of the facility as well as how the regulations will evolve as we go forward. Our approach is to be as collaborative and open as possible to support a global network of uncompromising quality systems. So far we’ve had the opportunity to host some of the regulatory agents from China who were visiting the US and even helped train some of the new regulators coming into the agency. The learning process has gone both ways.
6. What are the key drivers for the growing clinical trial market in China?
The population in China is very large – more and more patients are being enrolled in clinical trials coming from China and other non-western markets. This trend is continuing and it makes sense to be closer to the population in terms of logistics and simplicity of supply. Consumers in China are evolving quickly and their healthcare system is very dynamic in the way in which it’s evolving as well. There is a tremendous amount of emphasis on improving the healthcare system in China. Some of the regulatory aspects of that market make it beneficial for our sponsor companies to develop their products in China. We better support our customers by having a facility nearby.
7. When and how did the conversation to build a facility in China begin?
Catalent has been eyeing the Chinese market for two and a half years. The clinical supply conversation started 12-18 months ago. From our standpoint – Catalent covers most of the globe and one of the places where we didn’t own a facility was China. China represented an opportunity to expand our business in terms of softgel and clinical supply, both of which are growing very quickly and we’ve now significantly increased our presence in that marketplace. We’ve also received a tremendous amount of pull from our clients. Based on our service level, quality, on-time delivery and the relationships we’ve built, our customers were hungry for a facility in China and, given our growth strategies, it was an obvious move for us.
8. Tell us about your partner.
Our China facility is a joint venture with ShangPharma Corp. Catalent is the majority shareholder but we are clearly relying on our partner’s local expertise to succeed.
ShangPharma has domain knowledge of the development cycle; they have relationships with our existing customers and a strong presence with multinational customers. They were a near perfect fit in the range of services that were offered in that they’re related but not overlapping.
ShangPharma embodies our values and are heavily invested in building and strengthening the Catalent brand.
9. Any closing thoughts?
We’re very excited about this opportunity. It’s refreshing to see things moving quickly and the amount of interest that we’ve received from our customer base around the globe has been remarkable.