Building a business case for a fully

continuous biomanufacturing platform

Integrated Continuous Biomanufacturing
Jason Walther 23 October 2013
Sol Pompe disease Argentina

www.genzyme.com |
 Fully continuous biomanufacturing platform

Genzyme developing a continuous integrated platform

Technical results are promising
But can we justify the platform from a business perspective?
And can we use economic modeling to guide development?

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 Economic drivers for the continuous platform

CAPEX OPEX Risk

Universal platform Omni-product facilities Common work force Flexible infrastructure

Step reduction Smaller facilities Simpler process

Volume reduction Smaller facilities No scale-up

Single-use tech Faster build times Reduced turnaround Closed process

More automation Increased complexity Less labor

Steady state Consistent operation Steady quality

High-productivity Smaller facilities Media requirements

Can we quantify these advantages and disadvantages?

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 Financial valuation methodology

Estimate CAPEX/OPEX using BioSolve software

Estimate platform dev costs and lay out a future product timeline
Predict discounted cash flows for legacy & continuous platforms
Calculate financial indicators (e.g., NPV) and make assessment

Facility Cash Flow Financial

Estimates Projections Indicators
CAPEX/OPEX savings Discount future costs CVI, NPV, IRR, etc.
using the new platform

Develop- Launch Assessment

ment Costs Scenarios

Inputs Outputs
 Facility estimates: CAPEX and OPEX

Use BioSolve software package

Define process (unit ops, scaling rules, assumptions)
Calibrate cost data (equipment, materials, labor, etc.)
Benchmark against previous internal and external projects

Facility Scale Facility CAPEX

(Reactor # and Size) (Actual:Estimated)
Facility A 4X20,000L 104%
Facility B 12X12,000L 101%
Facility C 6X15,000L 101%
Facility D 3X10,000L 102%
Facility E 3X4,000L 120%

Biosolve capital estimates are acceptably accurate

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 Facility estimates: Platform assumptions

Legacy Platform Continuous Platform

mAb US Fed-batch US Suspension perfusion

500 kg/y 1X10,000L SS 2X500L SU
DS Batch DS Continuous
Time 12 days Time 60 days
IVCD 3000 Mcellh/mL VCD 100 Mcell/mL
Titer 3.5 g/L Titer 1.4 g/L

Enzyme US Microcarrier perfusion US Suspension perfusion

2X2,000L SS 1X500L SU
20 kg/y
DS Batch DS Continuous
Time 60 days Time 60 days
VCD 5 Mcell/mL VCD 100 Mcell/mL
Titer 0.05 g/L Titer 0.5 g/L

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 Facility estimates: Platform assumptions

CAPEX ($M) OPEX ($/g)

mAb Legacy
500 kg/y
2X 1.2X

1X 1X
Continuous

Enzyme
20 kg/y
3X 50X

1X 8X

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 Cost impacts of the fully continuous platform

mAb CAPEX mAb OPEX

% overall cost

Overall: 54% Overall: 20%

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 CAPEX/OPEX sensitivity analyses Red = More Savings

CAPEX Savings OPEX Savings

(Fed-Batch mAb Continuous mAb) (Fed-Batch mAb Continuous mAb)
Cell-Specific Perfusion Rate

Viable cell density

Financial estimates can guide process development

(For example, CSPR and VCD targets)
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 CAPEX/OPEX sensitivity analyses Red = More Savings

NPV for a single facility

(Fed-Batch mAb Continuous mAb)

Cell-Specific Perfusion Rate

Viable cell density

Financial estimates can guide process development

(For example, CSPR and VCD targets)
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 Financial valuation methodology

Facility Cash Flow Financial

Estimates Projections Indicators
CAPEX/OPEX savings Discount future costs CVI, NPV, IRR, etc.
using the new platform

Develop- Launch Assessment

ment Costs Scenarios

Inputs Outputs
 Product launch scenario

2025 2026 2027 2028 2029 2030 2031 2032

Create a hypothetical product timeline with various mAb

and enzyme product launches
Calculate NPV for two scenarios
Legacy platforms (fed-batch and microcarrier perfusion)
Universal continuous platform
Compare NPVs to estimate value of new platform
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 Advanced Modeling An Integrated Approach

Sales Product
Profiles Dashboard
Definition

Development
Profiles

Stocking
Product NPV Portfolio NPV
Strategy

In partnership with Manufacturing

Biopharm Services Ltd. Network

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 Relative cash flow projections

NPV for product portfolio

mAb OPEX
Enzyme OPEX
mAB CAPEX
Enzyme CAPEX
Development Cost

discount rate = 7%

Clear benefits to new platform (given the assumptions)

Hundreds of millions of dollars in potential savings
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 Relative cash flow projections

NPV for product portfolio

High demand

Medium demand

Low demand

Different product launch scenarios can be investigated

Continuous platform competes in a variety of scenarios
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 Conclusions

Infrastructure in place for economic modeling of future

platforms
Preliminary analysis shows strong, quantifiable business
drivers for continuous platform
We will continue to revisit and improve assumptions
Additional sensitivity analyses
Expand comparisons to other platforms (e.g., disposable FB)
Process development guidance
Cell density and CSPR are influential upstream parameters
Similar parameters will be found for downstream process

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 Acknowledgments

Genzyme Late Stage Process Development

Genzyme Capital Finance
Genzyme Industrial Affairs
Sanofi Biologics Research & Development
Biopharm Services

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