Contract drug manufacturers are making significant investments to tap into the rapidly growing market for weight-loss drugs. These companies are allocating billions of dollars to expand existing facilities or build new ones to accommodate the increasing demand for injection pen fill-finish services, especially for drugs like Novo Nordisk’s Wegovy.
Wegovy, a groundbreaking obesity treatment that mimics the body’s appetite-suppressing hormones, has seen remarkable sales growth since its U.S. launch in June 2021. Eli Lilly’s Mounjaro, another weight-loss drug, is also anticipated to gain approval in the United States, further fueling the demand for fill-finish services.
These weight-loss injections belong to the class of GLP-1 agonists, which industry analysts predict could be valued at up to $100 billion within a decade, including oral treatments under development by Pfizer and other pharmaceutical companies.
Contract manufacturers like WuXi Biologics are actively exploring opportunities to expand their pre-filled syringe capacity to serve GLP-1 customers. Companies like Catalent are already investing in significant pre-filled syringe capacity expansion in locations such as Anagni, Italy, and Bloomington, Indiana, to meet the growing demand. The race for business among Contract Development and Manufacturing Organizations (CDMOs) began the previous year, with several projects worth at least $3 billion already announced by companies including Lonza, Fujifilm Diosynth Biotechnologies, and Germany’s Vetter.
With Lilly’s Mounjaro set to launch and Novo facing challenges in meeting the increasing demand for Wegovy, the pace of expansion in this sector is accelerating.
Pharmaceutical giants often engage CDMOs when they lack the in-house expertise or scale to handle certain aspects of production. The filling of syringes requires sterile conditions to prevent contamination before pens are assembled, packaged, and distributed to pharmacies and clinics.
While Novo is making substantial investments to boost its Wegovy production, shortages are expected to persist into the next year. Lilly is also expanding its internal capacity while utilizing various CDMOs, such as Catalent and Thermo, for production.
The Insight Partners predicts that the fill-finish market will more than double between 2019 and 2027, reaching $12.5 billion. The rapid growth in GLP-1 drugs is expected to compensate for the loss of COVID-19 vaccine contracts in the CDMO industry.
Although many expansion projects will only be completed in the coming years, supply constraints are likely to persist, and the ability of CDMOs to boost capacity will play a crucial role in the growth of the obesity drug market.
In the short term, companies like Catalent and Thermo are positioned as leaders in the market due to their existing capabilities. Despite quality issues reported at Catalent’s Brussels factory, the company’s shares trade at a higher valuation than its peers, indicating its current dominance in the obesity drug manufacturing sector.
Executives in the industry emphasize that the scramble for capacity will not lead to an oversupply, as CDMOs follow a strategic approach to building and expanding their businesses.
The booming market for weight-loss drugs, particularly GLP-1 agonists, is driving significant investments in contract manufacturing for injection pen fill-finish services. The competition among pharmaceutical services companies to secure contracts and expand capacity is fierce, with industry experts predicting sustained growth in this sector.