After suffering an $18 million inventory write off, Seattle Genetics says its business as usual for the manufacturing of its lead antibody-drug conjugate (ADC) Adcetris.

In its fourth quarter 2018, Seattle Genetics reported an increase in its cost of sales attributed to an $18.1 million (€16.2 million) inventory write-off related to in-process production that did not meet manufacturing specifications and did not impact availability of product supply required to meet demand for its ADC product Adcetris (brentuximab vedotin).

Three months on and the firm’s management told investors the incident involved having to remake batches of the drug but the issues have now been resolved.

“There wasn’t a manufacturing issue there was a quality release threshold that we didn’t meet on a few batches. We let them go,” Seattle Genetics CFO Todd Simpson said on the Q1 investor call.

“We have now substantially reestablished all that inventory, so we’re in good shape.”

Developed with Takeda Pharmaceuticals, Adcetris uses Seattle Genetics’ linker technology to combine the brentuximab monoclonal antibody with a cytotoxic small molecule. It received approval from the US Food and Drug Administration in 2011​ to treat Hodgkin lymphoma (HL).

The firm uses what it describes as an “extensive network of contract manufacturers” to produce Adcetris, but complemented its production footprint in 2017 through the acquisition of a facility near its headquarters in Bothell, Washington from Bristol-Myers Squibb. Seattle Genetics paid the Big Pharma firm $17.8 million for the 51,000 square-foot plant and paid a further $25.5 million to purchase the equipment and make improvements at the site.

For the first quarter, Seattle Genetics reported total revenues of $195 million, up 39% on the same period 2018. Sales of Adcetris in the US and Canada – where the firm holds the marketing rights – stood at $135 million, up 42% year-on-year.