Market Size Determination for the Cell Therapy CDMO Market ......On November 7, 2016, Caladrius released 2016 third quarter results. In this announcement, Caladrius reported revenue

Market Size Determination for the Cell Therapy CDMO Market | BioInformant.com

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1. Introduction to the Cell Therapy CDMO Market

Among cell therapy companies, the pressure for manufacturing innovation and

optimization can incentivize them to seek third-party partners who possess technical,

manufacturing, and regulatory expertise, such as cell therapy contract and development

manufacturing organizations (CDMOs).

Currently, there are more than two dozen

cell therapy CDMOs specializing in

manufacturing and clinical trial support

for cell therapy companies.

Benefits of partnering with a cell therapy

CDMO include scalability, speed to market,

access to technical expertise without

overhead costs, and cost efficiencies. With

more than two dozen market participants

now offering cell therapy CDMO services, demand for these services is clearly expanding.

For purposes of this analysis, the following definition is applied.

Cell Therapy Contract Development & Manufacturing Organization (CDMO)

Market = The global market for all revenue derived from cell therapy CDMO related

services. This includes, but is not limited to, process development, technical consultation,

manufacturing services, clinical trial support, and regulatory expertise related to cell

therapy development and manufacturing.

Exclusions = This market analysis excludes related markets, such as the market for

pharmaceutical and biologics CDMO services.


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2. Methodology

To determine the size of the Cell Therapy CDMO Market, there are several possible methods

which can be utilized. First, there are “top-down” and “bottom-up” methods. A top-

down analysis is calculated using a known reference market, then estimating the

percentage of that market composed by a specific niche or sub-segment. For example, if

there was a known market size for all types of CDMO services, then a top-down approach

could be used to identify the percentage of that market that was derived from cell therapy

CDMO services.

This can be an effective approach, but it requires a known metric as a starting point, which

does not apply for the CDMO market.

In contrast, a bottom-up analysis takes all independent contributors to a market and adds

them up to determine a total value. There are three primary ways to execute a bottom-up

analysis, as described below:

1. Roll-up all competitor sales (“Gold Standard”)

For situations in which the total sales of all industry participants are known and can

be aggregated, this is considered the “Gold Standard” for market size estimation.

2. Use a weighted analysis of industry leaders (“Silver Standard”)

In large or fragmented markets with many small participants, it is often not possible

to compute the total sales of all industry participants. In these cases, the next best

alternative is to estimate market size by determining sales of the largest players and

estimating the aggregate share of other, smaller players. This is generally

considered the “Silver Standard.”

3. Survey customers for how much they spend in the market (“Bronze

Standard”)

Third, asking customers how much they spend in the market can also be used to

determine market size via a bottom-up approach. For this approach, a population of

customers is asked how much they spend each year on the products composing the

market, and the results are extrapolated for the market at large. This is generally

considered the “Bronze Standard,” because reporting by these individuals may vary

in accuracy, depending on the truthfulness of their reporting and the degree to

which the input data is relevant to extrapolation for the market as a whole.

Each method has advantages and disadvantages. In addition, there are aspects of each that

make them better suited for analysis of particular markets over others.


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For the Cell Therapy CDMO Market, the “Gold Standard” approach of rolling up

competitor sales cannot be used, because revenue data is not available for all market

participants. Many of the market participants are private companies that do not disclose

revenue figures. Additionally, there is great variation in company size and market share

owned by each market player. Even a slight change in the revenues generated by the

largest market players would cancel out the effect of any contribution from the smaller

players involved.

On the other hand, the Cell Therapy CDMO Market is well-suited for the “Silver

Standard” approach of doing a weighted analysis of industry leaders. This is because the

market is dominated by a few large participants, which include WuXi PharmaTech, Lonza

Group, and PCT, respectively.


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3. Market Participants

To assess the size of the cell therapy CDMO market, current market participants must be

identified.

Cell therapy CDMOs operating worldwide include:

1. WuXi PharmaTech, including Subsidiary WuXi AppTech, Inc.

2. Lonza, Cell Therapy Manufacturing Unit (Acquired PharmaCell, B.V. in May

2017)

3. MasTHerCell, Acquired by Orgenesis

4. Miltenyi Bioprocess, the Contract Manufacturing Business of Miltenyi Biotec

5. Hitachi Chemical Advanced Therapeutics Solutions (HCATS)/PCT (HCATS

acquired PCT March 2017)

6. Nikon CeLL innovation Co., Ltd. (“NCLi”), a wholly-owned subsidiary of

Nikon Corporation

7. KBI Biopharma (Acquired Opexa Assets, February 2017)

8. Brammer Bio (Formed through Merger of Brammer Biopharmaceuticals and

Florida Biologix)

9. CCRM (Built a 10,000 ft² Centre for Advanced Therapeutic Cell Technologies

within a 40,000 ft² facility featuring a GMP facility; Supported by CAD $40M

from GE and FedDev Ontario)

10. Roslin Cell Therapies, a Subsidiary of Roslin Cells

11. apceth Biopharm

12. Cognate Bioservices, Inc.

13. MEDINET Co. Ltd.

14. The Clinical Trial Company (TCTC)

15. Praxis Pharmaceutical

16. Cellular Therapeutics Ltd. (CTL)

17. CTI Clinical Trial and Consulting

18. ACG Asahi Glass (Bought German CDMO company Biomeva in September

2016)

19. Eufets GmbH

20. Fraunhofer Gesellschaft

21. Cellforcure SASU

22. Molmed S.p.A.

23. Advent Bioservices Ltd

24. Gravitas Biomanufacturing

25. Cell Therapies Pty Ltd (CTPL)

26. Akron Biotech (Focus is on development and manufacture of ancillary materials

and novel products/tools under cGMP compliance for tissue, cell and gene

therapies)


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4. Reference Data for the Cell Therapy CDMO Market

Reference data for the Cell Therapy CDMO market is not abundant, but there is some publicly

available data off which to base projections, as described below.

First, MaSThercell’s revenue data from cell therapy CDMO services is found in the February

28, 2017 10-K filed by its parent company, Orgenesis. Currently, the MaSTerCell’s CDMO

business is the only revenue generating business that Orgenesis has. It generated $6.4 million in

revenue in 2016.1

Revenue data is also available for PCT, because its parent company Caladrius publicly reports

performance. On November 7, 2016, Caladrius released 2016 third quarter results. In this

announcement, Caladrius reported revenue of $25.1 million for the first three quarters of 2016.2

Extrapolating that figure, its full-year 2016 revenue is estimated to be $33.5 million. An

assumption used in this analysis is that the only revenues Caladrius has are from its PCT

subsidiary, which is a profitable cell therapy CDMO business.

However, Caladrius Biosciences announced in March 2016 that it had signed an agreement

for its remaining 80.1% ownership interest in PCT, LLC (“PCT”) to be purchased by Hitachi

Chemical Co. America, Ltd. for $75 million in cash, forming Hitachi Chemical Advanced

Therapeutics Solutions (HCATS).3 Prior to this deal, Hitachi Chemical had owned a 19.9%

stake in PCT.

After this, the revenue data gets less clear. Wuxi PharmaTech released full-year 2015 financial

guidance estimating net revenues of $790 to 800 million4. However, it is difficult to discern how

much of this activity would be related to CDMO services. If one assumes that the “Biological

Services” segment of its business is the CDMO, then for the first nine months of 2015, WuXi

reported “Biological Services” net revenue of $57.8 million.5 Extrapolating that for full-year

2015, WuXi’s “Biological Services” net revenue would be estimated at $77 million for 2015.

It is also complex to use publicly available data to project WuXi’s 2016 revenue, because WuXi

reported a 61.9% increase for its “Biologics Services” for the 9 months ending September 30, 2014,

1 U.S. SEC Form 10-K, Orgenesis. Filed February 28, 2017. Available at:

https://www.sec.gov/Archives/edgar/data/1460602/000106299317001138/form10k.htm. Web. 27 Feb. 2017. 2 "Caladrius Biosciences Reports 2016 Third Quarter Financial Results | Caladrius". Available at: http://www.caladrius.com/press-release/2016-third-quarter-financial-results/. Web. 3 Mar. 2017. 3 Caladrius, H. (2017). Hitachi Chemical Signs Agreement to Purchase from Caladrius Biosciences the Remaining 80.1% Interest in PCT for $75

Million | Caladrius. [online] Caladrius.com. Available at: https://www.caladrius.com/press-release/hitachi-chemical-signs-agreement-to-purchase-from-caladrius-biosciences-the-remaining-80-1-interest-in-pct-for-75-million/ [Accessed 30 Oct. 2017]. 4 Wuxi Pharmatech Announces Fourth-Quarter And Full-Year 2014 Results". Available at: http://www.wuxiapptec.com/press/detail/269/18.html.

Web. 3 Mar. 2017. 5 "Wuxi Pharmatech Announces Third-Quarter 2015 Results,” Nov. 3, 2015. Available at: http://www.wuxiapptec.com/press/detail/296/18.html.

Web. 3 Mar. 2017.

https://www.sec.gov/Archives/edgar/data/1460602/000106299317001138/form10k.htm

http://www.caladrius.com/press-release/2016-third-quarter-financial-results/

http://www.caladrius.com/press-release/2016-third-quarter-financial-results/

http://www.wuxiapptec.com/press/detail/269/18.html



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and September 30, 2015, respectively.6 Therefore, it is possible that WuXi’s net revenue derived from

“Biological Services” could be substantially higher than $77 million for 2016, perhaps as high as

$125 million if it continued to experience a 61.9% rate of growth. However, WuXi’s net revenues

from “Biological Services” are not believed to haved increased by 66.1% from 2015 to 2016. Rather,

they are projected to have grown by 30-40% from 2015 to 2016.7 Consequently, WuXi is estimated

to have produced net revenue of $100 - $108 million from its CDMO services in 2016.

One reason to assume that WuXi’s “Biological Services” classification describes its CDMO

activities is that is states that its “Biologics Services revenue had strong growth of 66.1% year

over year from both development and manufacturing.” The other reason to make this

assumption is that WuXi states the following on its “Biologics” page:

“WuXi AppTec provides global solutions for biologics – a seamless, high-quality, single-

source approach offering complete R&D, from discovery & development to testing and

cGMP manufacture.”8

Next, Lonza Group can be evaluated based on publicly released data. However, it is again a

very large entity again, which makes the numbers complex to discern. In total, the company

reported total sales of CHF 4.1 billion (USD $4.05 billion) in 2016.9 More importantly, the

“Pharma & Biotech” segment of Lonza reported revenues of CHF 1.85 billion (USD $1.83

billion) for 2016.10 Of course, this Lonza business segment contains many other services beyond

its CDMO business. What is known is that Lonza supports two facilities in the United States and

Singapore that at partially support cell therapy. Additionally, in May 2017, Lonza completed the

acquisition of PharmaCell B.V., a cell and gene contract manufacturers in Europe.

PharmaCell has 2016 sales of EUR 11 million.11

With this reference data, BioInformant estimates Lonza’s 2016 revenues from cell therapy

CDMO services to be approximately 3-4% of its “Pharma & Biotech” segment, which would

represent 2016 revenues of $55 to $73 million.12

Furthermore, MEDINET Co., Ltd., is a company that is publicly listed on the Tokoyo Stock

Exchange. In its Consolidated Financial Report FY2015, it reported net sales of JPY $2.2 million

(USD $19.7 million) for its “Contract Cell Manufacturing Business.” The report states:

6 Wuxi Pharmatech Announces Third-Quarter 2015 Results,” Nov. 3, 2015. Available at: http://www.wuxiapptec.com/press/detail/296/18.html.

Web. 3 Mar. 2017. 7 Growth estimate based on a phone interview conducted with anonymous C-Level Executive, WuXi PharmaTech. March 3, 2017. 8 "Integrated Biologics Services By Wuxi Apptec". Available at: http://www.wuxiapptec.com/biologics.html. Web. 3 Mar. 2017. 9 “Full-Year Financial Highlights,” Lonza Full-Year Report 2016. Available at: file:///C:/Users/hi/Downloads/2016_FY_E_Final_v2.pdf. Web. 28 Feb. 2017. 10 Ibid. 11 Lonza.com. (2017). Lonza Acquires Cell and Gene Contract Manufacturer PharmaCell. [online] Available at: http://www.lonza.com/about-lonza/media-center/news/Tensid/2017-05-30-15-31-English.aspx [Accessed 30 Oct. 2017]. 12 Growth estimate based on a phone interview conducted with anonymous C-Level Executive, Lonza Group. March 2, 2017.


http://www.wuxiapptec.com/biologics.html


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“The source of the revenue of Contract Cell Manufacturing Business is mainly MEDINET’s

core service, Immuno-Cell Therapy Total Support Service, because MEDINET is in a

transition period before completely evolving into the new businesses. As the result, net sales

in Contract Cell Manufacturing Business increased 12.6% (a year-on-year increase of JPY

210,700 thousand) to JPY 1,876,719 thousand.”13

Since MEDINET experienced year-over-year growth of 12.6% from 2014 to 2015, projecting

that same rate of growth into 2016, it is estimated that MEDINET will produce approximately

$22.2 million in net sales for its “Contract Cell Manufacturing Business” in 2016.

Additionally, a limited amount of revenue data can be collected for Cognate Bioservices,

another cell therapy CDMO. In August 2016, Cognate Bioservices acquired a $2.2 million

manufacturing contract with Asterias Biotherapeutics to manufacture its dendritic cell vaccine.

As stated in Asterias’ U.S. SEC “Form 8-K” filed August 3, 2016:

“Under the Services Agreement, Cognate will perform under an Initial Statement of Work process

development studies in support of the Company's clinical and commercial development activities of

AST-VAC1 and production and manufacturing services of AST-VAC1 under cGMP under the

Second Statement of Work. In consideration for the process development services set forth in the

Initial Statement of Work, Asterias agreed to make aggregate payments of up to approximately $2.2

million in fees, costs and expenses over the term of the Initial Statement of Work.”14

Additionally, Cognate had previously been paid large sums by Northwestern Biotherapeutics

(NWBO). According to NWBO’s 10-K from 2013, NWBO reported R&D expenses of $43.9

million, $25.4 million of which was paid to its contract manufacturer Cognate BioServices.15

Intriguingly, Cogante Bioservices was a 10% owner in Northwestern Biotherapeutics, although it

sold most of its shares on June 30, 2016 for $7.3 million.

However, Northwestern Biotherapeutics reported on its FORM 10-Q for the period ended

September 30, 2016, that16:

“Pursuant to the Remediation Plan, the Company canceled the most favored nation provisions

related to warrants issued to Cognate under 2013 Manufacturing Services agreement (“2013

Agreement”) and 2014 Manufacturing Services Agreements (“2014 Agreements”) through a

binding agreement with Cognate. In addition, Cognate returned and the Company extinguished

6,880,574 warrants issued under the 2014 Agreements; the Company issued replacement

warrants of 4,305,772 at a higher exercise price. The aggregate fair value of the warrants

13 Consolidated Financial Report FY2015; FY2015: October 2015 - September 2016. MEDINET Co., Ltd. Released November 8, 2016.

Available at: http://v4.eir-parts.net/v4Contents/View.aspx?template=ir_material&sid=60814&code=2370. Web. 2 Mar. 2017. 14 U.S. SEC “Form 8-K,” Asterias Biotherapeutics, Inc. Filed August 3, 2016. Available at: file:///C:/Users/hi/Downloads/11081593.pdf. Web. March 1, 2017. 15 “What Wall Street is saying about Northwest Biotherapeutics, Inc. (OTC:NWBO)”, The Independent. Accessed Feb 15, 2017. Available at:

http://theindependentrepublic.com/2017/01/04/what-wall-street-is-saying-about-northwest-biotherapeutics-inc-otcnwbo-2/ 16 Northwestern Biotherapeutics, Form 10-Q. Period ending September 30, 2016. Available at: http://quote.morningstar.com/stock-

filing/Quarterly-Report/2016/9/30/t.aspx?t=:NWBO&ft=10-Q&d=c07a5c1e6573b84329d4ebefe4363d10. Web. Feb 25, 2017.

http://v4.eir-parts.net/v4Contents/View.aspx?template=ir_material&sid=60814&code=2370

http://quote.morningstar.com/stock-filing/Quarterly-Report/2016/9/30/t.aspx?t=:NWBO&ft=10-Q&d=c07a5c1e6573b84329d4ebefe4363d10

http://quote.morningstar.com/stock-filing/Quarterly-Report/2016/9/30/t.aspx?t=:NWBO&ft=10-Q&d=c07a5c1e6573b84329d4ebefe4363d10


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extinguished as of August 30, 2016 using Monte Carlo simulation was approximately $10.1

million, and was recorded through additional paid in capital.”

Therefore, it is believed that Cognate’s 2015 and 2016 revenue likely declined relative to its 2013

and 2014 revenue, because it had previously received payments in excess of $25 million from

Northwestern Biotherapeutics. In contrast, Asterias only entered into a $2.2 million contract with

Cognate. Cognate is believed to have several other small manufacturing contracts, but not in the

range of $25 million per year. As a result of these factors, Cognate’s cell therapy CDMO

revenues are estimated to be approximately $5 to 6 million for 2016.

KEY FINDING: While not all cell therapy CDMO revenue data can be found, the information

above indicates that WuXi PharmaTech is the largest industry player, followed by Lonza Group,

and PCT (now Hitachi Chemical Advanced Therapeutics Solutions), respectively.


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5. Market Share Breakdown

Large Market Players:

Currently, these top three market players account for approximately one-half (50)% of the total

market size, with their approximate market share estimations shown below:

• WuXi PharmaTech, and its subsidiary WuXi AppTec – 26% of market

(Revenue estimated at $100 to 108 million per year. For assigning a percentage

market share, the mid-point of $104 million per year is assumed.)

• Lonza Group – 16% of market (Revenue estimated at $55-73 million per year, or

roughly 62% of WuXi’s revenue17.)

• PCT / Hitachi Chemical Advanced Therapeutics Solutions – 8% of market

(Revenue estimated at $33.5 million per year, or roughly 32% of WuXi’s

revenue18.)

The reason that these three largest market players are assumed to control approximately 50%

of the Cell Therapy CDMO Market is that revenue data is available for each of these

companies and it sums to approximately $200m (described above).

For the eight mid-sized companies, they average between $5-25m each in revenue. For example,

MEDINET has known revenue of $22.2m, and MaSTerCell has known revenue of $6.4m.

Therefore, on average, these companies are estimated to produce about $12.5m each in revenue.

Of course, none of these companies will produce exactly $12.5m, but that value is a reasonable

mid-point for this set of eight mid-sized companies, given that known revenue data is available

for several of them and their classification as mid-sized companies.

(8 companies x $12.5m = $100m.) Clearly, $100m is half of $200m.

A similar approach is applied to the other categories as well. For the smaller market players,

there are 10 companies that are assumed to contribute approximately $60m

(15% market share).19 That means that these companies are assumed to produce, on average

$5-6m in revenue. ($6m x 10 companies = $60 million.)

The last 10% of the market is composed of other small cell therapy CDMOs, as well as

academic and medical center CDMOs. $40m is a very reasonable contribution to be estimated

for this group, given the number of market participants that it encompasses.

More information on each of these market groups is included in the following sections.

SUMMARY: The sum of the contributions from these four market groups is shown below.

TOTAL CONTRIBUTIONS FROM THE 4 MARKET GROUPS:

$200m + $100m + $60m + $40m = $400m

17 To calculate Lonza’ market share relative to WuXi, a mid-point between $100m and $108m million is assuming, meaning, $104m. Similarly, a mid-point halfway between Lonza’s $55m to $73m per year is assumed, meaning $64m. Therefore, $64m relative to $104m is 62%. 18 To calculate PCT’s market share relative to WuXi, a mid-point between $100m and $108m million is assuming, meaning, $104m. WuXi’s

revenue is estimated to be $33.5m. Therefore, $33.5m relative to $104m is 32%. 19 Potentially, MaSTerCell, should have been included in this category, but its revenue is just over $6m, so we included it in the mid-sized category


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Mid-Sized Players:

After the three largest market players (WuXi PharmaTech, Lonza Group, and PCT), there

are a substantial number of mid-sized players, shown below. As described, these mid-

sized players are estimated to contribute approximately 25% to the total Cell Therapy

CDMO Market. Revenue figures and other details are stated below as known. The

companies below are determined to be mid-sized players based on their number of

employees, facility size, and known cell therapy partners.

• MEDINET - Revenue estimated at $22.2 million per year

• MaSTerCell - Revenue known to be $6.4 million per year

• Cognate Bioservices - Revenue estimated to be $5 to 6 million per year

• Miltenyi Bioprocess –This business unit of Miltenyi Biotec is showing signs of

expansion via targeted hires and several cell therapy CDMO contracts have

recently been secured20

• PharmaCell – Acquired May 2017 by Lonza; 2016 sales of EUR 11 million21

• Brammer Bio

• Roslin Cell Therapies

Small Market Players:

There are also quite a few small market players. Altogether, these small market

participants are estimated to contribute another 15% to the total Cell Therapy CDMO

Market. Below comments about the business model of these smaller market players is

provided.

• ACG Asahi Glass - Bought German CDMO company Biomeva in September

2016

• Akron Biotech – Akron’s focus is on the development and manufacture of

ancillary materials and novel products/tools under cGMP compliance for tissue,

cell and gene therapies

• Advent Bioservices Ltd. - Advent Bioservices are a contract bioservices

organisation providing GMP manufacturing services for a variety of ATMPs and

related products, process development (PD) and ancillary services.22

• apceth Biopharma – Focused on development of its own genetically engineered

MSCs for cancer therapy, with limited cell therapy CDMO clients

• Cell Therapies Pty Ltd. (CTPL) – CTPL is a leader in manufacturing and

distribution of cell-based therapies with 15 years of GMP contract manufacturing

under Australia’s Therapeutic Goods Administration (TGA) manufacturing

licenses.

20 Phone Interview with Anonymous C-Level Executive, Miltenyi Representative. Conducted March 2, 2017. 21 Lonza.com. (2017). Lonza Acquires Cell and Gene Contract Manufacturer PharmaCell. [online] Available at: http://www.lonza.com/about-lonza/media-center/news/Tensid/2017-05-30-15-31-English.aspx [Accessed 30 Oct. 2017]. 22 Advent Bioservices, Ltd. (2017). [online] Available at: https://www.linkedin.com/company/advent-bioservices/ [Accessed 30 Oct. 2017].


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• CCRM - Built a 10,000 ft² Centre for Advanced Therapeutic Cell Technologies

within a 40,000 ft² facility featuring a GMP facility; Supported by CAD $40M

from GE and FedDev Ontario

• CTI Clinical Trial and Consulting – Traditionally developed transplant

therapies, but has expanded into regenerative CDMO services

• Gravitas Biomanufaturing – Based in San Diego, California, Gravitas is a

newcomer to the cell therapy CDMO scene.

• KBI Biopharma – Did not acquire Opexa’s cell therapy assets until February

2017. It was previously was uninvolved with cell therapy CDMO services.

• The Clinical Trial Company (TCTC) – Its only known client is Cynata

Therapeutics, who is preparing to begin a small Pase I clinical trial to test CYP-

001 in GvHD

• Cellular Therapeutics – Very small cell therapy CDMO composed of

approximately 15 employees

• Praxis Pharmaceutical – Offers cell therapy CDMO services, but little to no

information exists to indicate it has acquired cell therapy clients

• Eufets GmbH – Main client is Medigene for process development and clinical

supply of TCR-modified T cells for cancer immunotherapy.23

• Fraunhofer Gesellschaft - Offers the manufacture of ATMPs, including tissue

engineering products, somatic cell therapies, and adult stem cell therapies, with a

focus on automation strategies and solutions. With this unique focus, it is a

speciality service provider.

• CellforCure SASU - CELLforCURE is a pharmaceutical establishment, but it is

authorized to manufacture cell and gene therapy products.

• Molmed S.p.A. - MolMed S.p.A. is a biotech company focused on development

of anticancer therapies, but it also offeres expertise in cell and gene therapy to

third-parties.24

The final 10% of the Cell Therapy CDMO Market is contributed by cell therapy CDMOs

that are not listed above. Mostly, these are cell therapy CDMOs maintained by academic

institutions (e.g. Stanford, University of Wisconsin, Penn), medical clinics (e.g. Mayo

Clinic), and small market players not worthy of being featured as full-service cell therapy

CDMOs. While these sites do contribute to the cell therapy CDMO market, their

manufacturing capabilities are limited in scale and best suited to small, early-stage trials.

For example, Cellular Therapeutics was awarded a contract from the UK Cell and Gene

Therapy Catapult to produce a new cell-based cancer therapy in August 2015. Cellular

Therapeutics is manufacturing the engineered cells for the Cell and Gene Therapy

Catapult over a 2 or 3 year period, providing enough clinical material for ongoing Phase I

and II trials, which are due to complete recruitment in 2017. However, preliminary

23 GmbH, Eufets. "COMPANY - EUFETS". Available at: https://www.eufets.com/about-us/company/. Web. 3 Mar. 2017. 24 Molmed Company Profile, LinkedIn.com. Available at: https://www.linkedin.com/company/molmed. Web. Feb 28, 2017.

https://www.eufets.com/about-us/company/

https://www.linkedin.com/company/molmed


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manufacture was carried out at the UCL Institute of Child Health/Great Ormond

Street Hospital cell therapy production unit.

This allowed the first patient to be enrolled into the trial in December 2014, but

additional capacity was needed to accelerate the project. It is not uncommon for academic

institutions to provide very small-scale, early-stage cell therapy CDMO services, but

typically, they cannot provide the throughput or economies of scale provided by

dedicated commercial and not-for-profit organizations (e.g. Cell and Gene Therapy

Catapult and Roslin Cell Therapies).

Examples of academic institutions involved in cell therapy manufacturing include:

1. Stanford’s Lab for Cell, Gene Medicine in Palo Alto

2. Waisman Biomanufacturing, a facility in the Waisman Center at UW–Madison

3. Center for Advanced Cellular Therapeutics, Penn Medicine campus

4. The Massachusetts Accelerator for BioManufacturing – Recently expanded its

facilities

5. Upstate Stem Cell cGMP Facility at the University of Rochester Medical Center

6. University of Miami’s Interdisciplinary Stem Cell Institute, Clinical Research

Cell Manufacturing Program (ISCI-CRCMP)

An example of a medical clinic supporting cell therapy manufacturing is:

1. Mayo Clinic Built a Manufacturing Facility for Cardio3 Trials (Cardio3 is now

Celyad)

In total, academic centers, medical centers, and other small contributors to the Cell

Therapy CDMO Market are estimated to contribute another 10% to the total market.

https://med.stanford.edu/news/all-news/2016/09/stanfords-lab-for-cell-gene-medicine-opens-in-palo-alto.html

http://news.wisc.edu/biomanufacturing-center-takes-central-role-in-developing-stem-cell-therapies/#sthash.IrzDTIJ9.dpuf

http://www.uphs.upenn.edu/news/News_Releases/2014/09/cact/

http://www.southcoasttoday.com/apps/pbcs.dll/article?AID=/20140921/NEWS/409210313

http://www.urmc.rochester.edu/news/story/index.cfm?id=3698

http://isci.med.miami.edu/about/cellular-manufacturing-program

http://isci.med.miami.edu/about/cellular-manufacturing-program

http://www.bizjournals.com/twincities/morning_roundup/2014/10/rochester-mayo-wooing-regenerative-medicine.html


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6. Summary of Market Breakdown

The information from the previous section is summarized below:

Large Market Players: ~50% of Cell Therapy CDMO Market

Mid-Sized Market Players: ~ 25% of Cell Therapy CDMO Market

Small Market Players: ~15% of Cell Therapy CDMO Market

Academic, Medical, & Other Market Contributions: ~10% of Cell Therapy CDMO

Market

===========================================================

TOTAL = 100%

50%

25%

15%

10%

Cell Therapy CDMO Market, by Market Segment

Large Market Players

Mid-Sized Market Players

Small Market Players

Academic, Medical, & OtherMarket Contributions


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7. Market Size Determination

As mentioned previously, revenue data pertaining to cell therapy CDMO services is

largely limited to companies listed on public stock exchanges. Therefore, revenue figures

from the following companies are valuable: MaSTerCell’s parent company, Orgenesis

(ORGS:OTC US); PCT, a Caladrius Biosciences company (NASDAQ:CLBS) prior to its

acquisition by Hitachi; WuXi PharmaTech (NYSE: WX); MEDINET (TYO:2370); and

Lonza Group (LZAGY:US).

Furthermore, these known revenue figures are beneficial, because they help with the

estimation of revenue figures for cell therapy CDMO operators who do not publicly report

their revenues. While the terms of contracts offered by cell therapy CDMOs vary, this

method provides a good approach for estimating revenue figures across the industry.

Applying these known revenue figures, extrapolating them to make market estimates for

other similar industry participants, and then summing these revenue figures to produce an

industry total, allows for a reasonable estimation of the cell therapy CDMO market.

As such, the following shows market size estimations by market segment, produced using

the “Silver Standard” method of applying a weighted analysis of industry leaders to

calculate the total (previously described).


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CELL THERAPY CDMO MARKET – MARKET SIZE DETERMINATION

Large Market Players (WuXi, Lonza, and PCT)

Approximately 50% of Cell Therapy CDMO Market

Revenue Estimation USD ~$200 Million25

Middle-Sized Market Players (MEDINET, Brammer Bio, Cell and Gene Therapy Catapult,

Cognate Bioservices, MaSTerCell, Miltenyi Bioprocess, PharmaCell, Roslin Cell

Therapies)


Revenue Estimation USD $100 Million

Small Market Players (apceth, CTI, Miltenyi, KBI Biopharm, TCTC, Cellular

Therapeutics, Praxis, Eufets GmbH, Fraunhofer Gesellschaft, CellforCure,

Molmed)


Revenue Estimation USD = $60 Million

Academic, Medical, and Other Market Contributors (Stanford, University of

Wisconsin, Penn, Mayo Clinic, etc.)


Revenue Estimation USD = $40 Million

IN TOTAL, THE CELL THERAPY CDMO MARKET IS ESTIMATED

TO BE $400 MILLION IN 2016.

25 Total calculate using estimated revenue of $100m to $108 million per year for WuXi, $53m to $73m per year for Lonza, and $33.5m per year

for PCT. In total, this number is approximately $200m.


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8. Five-Year Market Forecasts

This section considers five-year market forecasts for the Cell Therapy CDMO Market.

To determine a growth rate to apply to the market, three input sources were used. See the input

descriptions and resulting data below.

Input Sources for Growth Projections

• Input 1 (Quantitative): Rates of trials in the ClinicalTrials.gov database containing

the term “cell therapy.” Unfortunately, this term does not capture all cell therapy

trials, because many would be named after the tissue-specific or stem cell specific

type being used. However, nearly all trials that it does capture are relevant, which

makes it well suited for a growth rate analysis.26

• Input 2 (Quantitative): Rates of scientific publications containing the term “cell

therapy” in the scientific publication database PubMed.gov. This was input chosen

because most cell therapy progress is initially published within the scientific

literature, and subsequently, explored in clinical trials. This makes scientific

publication rates a valuable predictor of future trends.

• Input 3 (Qualitative): Number and behavior of market competitors. The number of

market competitors is growing on a year over year basis. Most recently, KBI

Biopharma bought that assets of Opexa Therapeutics in February 2017 to enter the

market for cell therapy CDMO services. Additionally, WuXi AppTec continues to

build new cell therapy manufacturing facilities in Philadelphia, PA. Most recently,

WuXi constructed a 45,000 ft2 facility became operational as of Q2 2015 and a

150,000 ft2 facility that became operational in Q3 2016. These events and many

others profiled earlier in this report provide evidence that market competitors are

expanding on a year-over-year basis.

TABLE. Rates of Trials in ClinicalTrials.gov Containing the Term “Cell Therapy”

26 Searching for the term cell therapy (without quotes) in the ClinicalTrials.gov database returns all results that contain the word “cell” and

“therapy”, even when the words are separated within the text. This returns a total of 35,340 results, a population which contains extraneous results. Therefore, searching for the phrase “cell therapy” (using quotes to specify that the words should be found together as a phrase in the text)

produces a more targeted result.

Year # of Trials % Year-Over-Year Change

2012 63 N/A

2013 91 44%

2014 121 33%

2015 110 -9%

2016 125 14%

TOTAL (2012-2016) 510 Average = 20.5%


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TABLE. Rates of Scientific Publications in PubMed.gov Containing the Term “Cell Therapy”

With

cell therapy clinical trials experiencing an average rate of growth of 20.5% per year and cell

therapy scientific publications experiencing an average rate of growth of 20.5% per year, a

conservative estimate of growth for the cell therapy is 15% per year.

Therefore, market size projections for the Cell Therapy CDMO Market are shown below.

TABLE. Market Size Projections for the Cell Therapy CDMO Market

As shown in the table above, the Cell Therapy CDMO Market is expected to grow to

approximately $805 million by 2021.

Year # of Trials % Year-Over-Year Change

2012 1395 N/A

2013 1553 11%

2014 1872 21%

2015 2199 17%

2016 2593 18%

TOTAL (2012-2016) 1,107 Average = 16.8%

Year Market Size Forecast (In Millions)

2016 400

2017 460

2018 529

2019 608

2020 700

2021 805


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400

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529

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2016 2017 2018 2019 2020 2021

Ma

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Size of the Cell Therapy CDMO Market


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About BioInformant.com BioInformant is the first and only market research firm to

specialize in the stem cell industry.

BioInformant research has been cited by prominent news

outlets that include the Wall Street Journal, Nature

Biotechnology, Xconomy, and Vogue Magazine.

Serving Fortune 500 companies that include Pfizer,

Goldman Sachs, and GE Healthcare, BioInformant is your

global leader in stem cell industry data.

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Market Size Determination for the Cell Therapy CDMO Market ......On November 7, 2016, Caladrius released 2016 third quarter results. In this announcement, Caladrius reported revenue