West recorded revenues of $278m in the first quarter, up 5 per cent year-on-year, despite growth being held back by a number of factors. These included last year's exit from the diagnostic component business as well as reduced sales of erythropoiesis stimulating agents (ESAs) by West's customers as a result of more restrictive regulatory and reimbursement conditions.
Most notable perhaps was the demise of Pfizer's inhaled insulin product Exubera. West had been contracted to make and supply the inhaler for that product, and after Pfizer pulled the product a facility West operates in Michigan began to operate at a loss.
Don Morel, West's CEO, said on a conference call that "collectively, these three issues hit our Q1 revenue line, in line with our expectations or roughly $20.9m." But he is pleased that other business units "came through with stronger than anticipated results." Operating profit dipped slightly to $38m.
New syringes
West has high hopes for a new ready-to-use prefillable syringe product - Daikyo Crystals Zenith - that could debut in Europe for stability and line trials during the second quarter of 2008 with a US introduction slightly later in the year.
The syringes are coated with a barrier film (Flurotec) that removes the need for silicone oil in the syringe barrel for lubrication. While providing essential lubrication in syringes, the downside of silicone oil is that can cause drug product contamination, protein aggregation and possibly even immunogenic reactions in sensitive patients.
You can sometimes see the protein precipitate in the drug solution, which can raise concerns among healthcare staff and patients. But another issue is that manufacturers can get away with putting less of their often-expensive active substance in the product because they don't have to compensate for this conglomeration issue - and that could equate to major cost-savings, according to West.
"Demand for samples in advance of the formal introduction is stronger than expected," said Morel.
Another key launch for West will be its Orion Passive Safety Needle System - expected in the fourth quarter of 2008. This product incorporates a self-activating needle cover that deploys automatically after an injection is given, rather than requiring any action by the clinician or patient, and should be a real advance in the prevention of needlestick injuries.
"These products are expected to add new sources of significant revenue growth beginning in two or three years," said Morel.
Meanwhile, West has started bundling together its categories - stoppers, seals etc - into a package that can be used by development scientists in small-scale, tabletop sterile suites. The aim is to entice scientists to use West components in the preclinical and clinical stages of new product development, with the likelihood that those same components would be used when projects move in later development and production.
Capacity expansion
Morel also noted that the company has been investing strongly in new manufacturing capacity, recently starting work on a Greenfield site in China to make plastic components for intravenous systems, as well as bolstering capacity in metal and plastic component production in the US.
The new capacities will come online through the end of the year and the beginning of 2009, he added.
