Bio-Techne will invest $40 million to construct a GMP facility in Minneapolis expected to feed the growing demand for reagents in the cell and gene therapy space.

The life sciences services and consumables firm reported a 12% growth in sales year-on-year in its third quarter FY2019 within its Protein Sciences segment. The segment – which supplies proteins such as cytokines and growth factors, immunoassays, antibodies and reagents to the biopharma industry – pulled in $138 million in the quarter. Its Diagnostics and Genomics segment also grew 15% year-on-year to $47 million.

Charles Kummeth, Bio-Techne’s CEO, attributed much of the growth to the firm’s solutions for the cell and gene therapy workflow, which grew 30% during the quarter as demand for reagents mirror the increased activity in the space.

Image: iStock/Tuomas_Lehtinen

“The use of GMP reagents early in the manufacturing process is highly advantageous as it eases the cell therapy workflow transition from bench to clinic by preventing the need to switch to GMP at a later stage when the cost and risk of change is higher, and the freedom of change is lower,” he explained on a financial conference call.

He admitted cell and gene therapy applications are currently a relatively small portion of Bio-Techne’s reagents business today but said that with over 1,000 cell therapies in the clinic, “the need for GMP-grade reagents in the coming years is going to accelerate dramatically.”

To meet the need, he announced Bio-Techne is investing around $40 million in capital on a new GMP factory in Minneapolis, expected to be completed within the next 12 months.

“This factory will have the capacity to deliver annually over $200 million worth of GMP reagents to cell and gene therapy customers. We expect to be producing at least half of that annual capacity within the next five years.”

Buoyed by M&A

Market demand and the Minneapolis plant gives Bio-Techne the opportunity to double its protein business, Kummeth said.

He also said the recent acquisitions in the gene therapy space show Bio-Techne is on the right path. Catalent has proposed to buy Paragon for $1.2 billion, and Thermo Fisher is set to buy Brammer Bio for $1.7 billion, for example.

“It makes me feel better to see the Brammers being picked up by the Thermos… There’s clearly a lot of potential.”

He warned industry’s pipeline “may end up being throttled three to five years out by the lack of GMP proteins, reagents and all the things that people may not be taking into consideration that you’ve got to have to get these therapies to market,” and therefore: “We’re going for it.”

“We don’t spend a lot of capital anyway, so it’s a very prudent investment and we think the payback will be absolutely huge.”