Next-gen manufacturer Antheia is teaming up with the U.S. Department of War to build out its infrastructure and onshore the U.S. drug supply chain.
The California ingredient maker has received a conditional $80 million loan commitment from the Department of War’s Office of Strategic Capital. The conditional financing will bolster Antheia’s growth strategy while gaining the U.S. critical access to key starting materials (KSMs) and active pharmaceutical ingredients (APIs) that are almost exclusively produced overseas.
Antheia estimates that the U.S. relies on foreign countries for roughly 90% of its KSMs and APIs. China alone is responsible for 41% of all KSMs that make their way to American patients, according to a report by U.S. Pharmacopeia. This predicament makes American patients extremely vulnerable to drug shortages driven by trade wars, natural disasters and geopolitical tension.
“Advanced biomanufacturing offers the U.S. a direct path to securing these supply chains while regaining global leadership in a strategic technology sector,” Christina Smolke, Ph.D., CEO and co-founder of Antheia, said in a statement. “This conditional commitment from OSC marks an important milestone in advancing domestic technology to address our most urgent national priorities.”
Antheia manufactures KPMs and APIs using its advanced biosynthesis platform, a process that leverages yeast for fermentation-based production of complex molecules that traditionally could only be harvested from plants. Antheia has touted its approach as faster, more cost-effective and more sustainable.
In 2020, the ingredient maker set out to produce thebaine, a KSM for the overdose rescue medicine Narcan. But the U.S. manufacturing infrastructure wasn’t up to the task.
“We pursued several domestic leads, but none could accommodate our technical processes, capacity requirements, and timelines. To scale, we ultimately had to take our processes to Europe, where we launched our first commercial product,” Smolke said in a June LinkedIn post.
Antheia’s $80 million loan is contingent on the company’s completion of various financial, legal, technical, investment and due diligence requirements.
As the Department of War unveiled the conditional loan agreement, President Donald Trump made a big promise to invest in an Antheia facility in Kentucky, but only if Republicans win the mid-term.
“If the Republicans win, the Department of War will be investing $100 million in the pharmaceutical company Antheia to revitalize a gigantic drug manufacturing facility in Winchester, Kentucky,” Trump said at a midterm election rally in Highland Heights, Kentucky, on Oct. 17.
The loan is in line with an array of other onshoring efforts initiated by the Trump administration. Last month, nine more drugmakers pledged $19.6 billion to U.S. manufacturing as part of their “most favored nation” deals, and U.S. Economic Development Administration invested $15.7 million in a fully domestic supply chain for sterile injectables. Shortly after, the White House Office of Management and Budget called for onshore and near shore manufacturers to report their capacity to produce 86 key generic medicines—part of an initiative to bring production of those 86 medicines stateside in the next 18 months.
By Antheia’s math, a “$1 billion investment to retrofit existing facilities for advanced biomanufacturing could onshore more than half of the annual U.S. essential medicine demand,” Smolke wrote earlier this summer. That’s a one-time investment that could “entirely eliminate” U.S. dependency on foreign-made pharmaceutical ingredients and a “meager fraction” of the defense budget, she said.
Prior to funding from OSC, Antheia received a total of $21 million from the U.S. Department of Health and Human Services as a member of the Biopharmaceutical Manufacturing Preparedness Consortium (BioMaP-Consortium).