COVID-19 vaccines are moving forward at record speeds, but market watchers have cautioned about the looming manufacturing challenges. Merck KGaA, with its manufacturing services outfit, could see billions of dollars in revenue as it assists certain players with their scale-up, an analyst says.
The company is working with more than 200 groups developing COVID-19 vaccines and drugs, Jefferies analyst Brandon Couillard wrote to investors after speaking with Merck KGaA's process solutions division head, Andrew Bulpin. Among them are Baylor University and Oxford University, two groups advancing COVID-19 vaccines.
Couillard’s team figures the market opportunity could be worth $4 billion to $5 billion. Still, it’s “hard to quantify … until we know which vaccines actually work and what type of production processes each will use,” he pointed out.
Merck KGaA’s process solutions outfit aims to help groups take their programs from R&D scale to “pilot scale” and eventually industrial production. That’s a “very complex” process, the analyst wrote, “but Merck is aiming to help shorten the timelines, given its expertise and breadth of up/downstream solutions.”
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The company is already a "market leader" in process solutions and is on track to generate nearly $4 billion in revenues this year, the analyst wrote. Meanwhile, amid the COVID-19 crisis, more than 160 vaccines are in development, many of them from academic groups and small biopharma companies that could use manufacturing assistance.
As Merck KGaA expands in life sciences, the company recently opened a campus in Shanghai with 13 labs spanning drug discovery, development and manufacturing, according to SHINE.