Bayer's gene therapy CDMO Viralgen cuts ribbon on first phase of $142M viral vector expansion

DNA helix forming inside a test tube
Viralgen completed the first phase of a roughly $142 million gene therapy manufacturing upgrade in Spain. (Getty Images)

Viralgen, the gene therapy CDMO coined by Bayer’s Asklepios BioPharmaceutical, is wading into commercial waters.

The Spanish contractor on Wednesday said it cut the ribbon on the first $83 million piece of its new factory in the Basque Country, Spain. Viralgen, which specializes in adeno-associated virus (AAV) vectors—the engineered viruses used to deliver gene therapies—has been helping customers with preclinical through phase 2 projects since 2018.

With the new plant, located in the same San Sebastian technology park as Viralgen’s existing facility, the company will now be able to tackle projects from pre-clinical stages all the way through commercial medicines, it said.

Thanks to the new plant, Viralgen has expanded its capacity fivefold. The company expects the site will release its first commercial-grade 2,000-liter batches by the middle of next year. Throughout 2021, the company will work to validate its equipment and score certifications.

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Viralgen has invested more than €70 million ($83 million) for the first phase of its manufacturing upgrade. It plans to drop a total of €120 million ($142 million) as it works to build two more buildings there. The company will recruit 130 workers to staff the facility and expects its headcount at the site to surpass 250 by 2022.

Viral vectors are needed for many next-gen drugs, from CAR-T cell therapies and gene therapies to certain COVID-19 vaccines—and that’s causing big problems for the industry. The vector shortage is already upon us, and it’s set to worsen in the coming years unless regulators, biopharmas and contract manufacturers move fast to address shortfalls, GlobalData said in a recent report.

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Answering the call, Viralgen's plant will boast the distinction of being one of the "largest" AAV factories in the world once it's complete, Viralgen says on its website. The company says it will use the facility to help "democratize" access to gene therapies. 

Columbus Venture Partners and Asklepios, also known as AskBio, founded Viralgen in 2017 in a bid to tackle mounting production demands in the gene therapy arena. As of last fall, both Viralgen and AskBio now fly the Bayer banner.

In October, Bayer struck a deal to acquire AskBio—and Viralgen by extension—for $2 billion upfront, plus another $2 billion in milestones. The deal will allow Bayer to tap into AskBio’s AAV gene therapy platform and a pipeline of clinical-phase treatments for Parkinson’s disease, Pompe disease and congestive heart failure.