Editor's note: This article ran as part of our annual CDMO profiles series, highlighting four young companies built to help pharma tackle the future of medicine.
Hanns-Christian Mahler’s first spend as CEO of ten23 health was trash.
Shortly after launching the new Switzerland-based CDMO in 2021, before operations had even begun, Mahler purchased 10 tons of trash via plastic credits. His goal? Preemptively offset the unavoidable plastic waste produced while developing and manufacturing sterile drug products.
“I handed over the invoice to my investors in fear that they would fire me on the spot,” says Mahler.
But Mahler was just getting started. Now, with an ISO9001-certified sprawling lab facility in Basel, a GMP-certified sterile production facility in Visp and further expansions underway, ten23 health has set the stage to more than double its batch production of modern injectable therapies and secure its position as a leader for complex formulations and sterile dosage forms in the rapidly growing sector.
Perhaps more importantly, ten23 has stayed true to Mahler’s vision: To embrace fairness and sustainability in all aspects of business — and to do so with a sense of urgency.
“Back in 2021, I thought it was not enough to make pledges for 2030. That’s too late; we have to act now,” says Mahler. “And that’s when I realized there was a unique opportunity to disrupt a bit in the pharma and CDMO sector by thinking through sustainability and organizational design with a different drive and faster pace.”
In the competitive pharma contracting space historically dominated by a handful of legacy players, the young ten23 health has set itself apart by building an unconventional model that allows the company to offer expertise spanning the life cycle of complex sterile drugs, from early-stage candidate selection to commercial production, all while keeping patients and the planet at the forefront.
Starting with the end in mind
It didn’t take ten23 long to make its first large purchase (and this time, it wasn’t trash). A month after the company’s commercial launch in September 2021, the fledgling CDMO acquired sterile filling leader swissfillon and its Swissmedic- and FDA-inspected facility in Visp, Switzerland.
The purchase enabled ten23 to quickly offer integrated services for both development and manufacturing of sterile medicines. And the timing couldn’t have been better.
The demand for sterile pharmaceuticals is surging — according to McKinsey, the world will need more sterile products than manufacturers have or can build capacity for in the near future. Specialist CDMOs like ten23 are ideally positioned to help.
But the advantages of teaming with an integrated CDMO go beyond capacity. According to Mahler, when it comes to sterile drug development, a common mistake is looking at fill-finish as an afterthought. “Due to its complexity, the drug substance gets so much focus that the whole element of administration, stability and manufacturing of the drug product doesn’t receive a lot of attention.”
Ideally, says Mahler, products should be created with the end — the patient — in mind. Details such as how the drug will be administered, the choice of delivery device, the viscosity of the formulation and even the diameter of the needle, should be considered from the start.
“ten23’s focus is a lot about asking questions and thinking about the directions this product can take in the marketplace and in the hands of a patient or health care professional — and then helping the customer to conceptualize the product,” says Mahler.
Failing to look at the process holistically, and thus deprioritizing fill-finish, can cost pharma companies more in the long run.
“I sometimes hear people say ‘it’s just putting liquid into glass, how difficult can it be?’” says Mahler.
The fill-finish process is prone to issues, including bottlenecks, contamination and product loss. Aseptic fill-finish for complex products, such as high concentration formulations for intravitreal or subcutaneous delivery, is uniquely challenging due to high viscosities and stability issues in addition to specific regulatory requirements. Mahler cautions against bargain-hunting in an area that requires advanced technology and scientific and regulatory know-how.
“We’ve had customers approach us who basically said, ‘We had $3 million worth of drug substance and the CMO we previously utilized destroyed it in one fill — but the fill was very cheap!’”
Sustainable from the start
ten23 built a sustainable company in much the same way it approaches sterile medicine development — by starting early in the process. Launching a new company with sustainability as a core tenet gives ten23 distinct advantages over companies trying to work backwards and ‘retrofit’ sustainable practices into existing businesses.
“It was a clear opportunity for us to instill sustainability into the DNA of the organization — build it into every decision when people go on business trips, when thinking about sourcing procurement, when establishing checklists for our supplier evaluations, etc.,” says Mahler. “It gave us a total kickstart in defining our approach to sustainability and organizational culture.”
In ten23’s first two years of existence, the company was already operating ‘carbon positive.’ It achieved an EcoVadis sustainability rating in 2023 and has a Pending B-Corp status, a certification which affirms a company’s commitment to using business as a force for good.
The company chose to locate its headquarters and development operations on the Rosental Mitte life sciences campus in Basel, taking over 4,000 square meters of existing building infrastructure, and then immediately adding sustainable upgrades. Features such as LED lights and motion controls, water-saving faucets, composting for organic waste and plastics recycling were incorporated into the facility. No detail was overlooked, right down to the type of toilet paper used in the restrooms.
But anyone in the pharma industry knows the biggest sustainability obstacle comes on the plant floor, especially when handling aseptic drugs. Using single-use, disposable plastics offers several pivotal advantages, including lessening the risk of cross-contamination, speeding turnovers and eliminating the need for cleaning validation.
While employing single-use systems has become standard practice in aseptic environments, Mahler says the pharma industry tends to overuse materials in the name of caution.
“Companies sometimes sterilize three filters for a fill, just to be safe,” says Mahler. “The general idea is that we make sure that we are not using materials in excess quantities. Our ambition is that waste per batch will go down.”
And while Mahler concedes that there’s probably no near-term solution for getting rid of plastic disposables in manufacturing, that doesn’t mean ten23 won’t try. For example, the company is embarking on a research project with other players in the Swiss industry, exploring the use of biodegradable disposables. ten23 has also announced its collaboration with Elio, an AI-based tool that aims to evaluate pharmaceutical processes from a sustainability perspective.
Still, for all its efforts and success stories, ten23 must go up against a well-established stigma: sustainability is expensive. The belief is so ingrained that Mahler has had clients approach him asking what the cost savings would be if ten23 were to not operate sustainably.
“Our approach to sustainability is not optional for customers. It’s our way of operating,” asserts Mahler. “I think this impression that sustainability is costing us so much money is an absurd image. It’s actually helping us save money — we improved our energy efficiency by 30% compared to last year by prioritizing sustainable practices in our business development.”
It’s a battle being fought broadly across the pharma industry, but Mahler hopes that ten23, through its transparency, can showcase how pharma companies and CDMOs can simultaneously save money and the planet.
An organizational rethink
Mahler credits much of ten23’s success to its nontraditional organizational structure. An individual driven by his own inherent motivation, Mahler wanted to build a company where employees had a deep sense of purpose and could work according to their personal strengths.
Inspired by management models in books like Frédéric Laloux’s “Reinventing Organizations” and Sebastian Klein and Ben Hughes’ “The Loop Approach,” Mahler designed ten23’s organizational culture to be adaptive, allowing employees to be their authentic selves in the workplace. ten23 also eliminated some of the more traditional hierarchical ways of operating, such as line managers and performance ratings, instead embracing a management framework based on holacratic principles that empowers every team member to make decisions for their given role(s).
Additionally, the approach has helped ten23 tackle an ongoing obstacle in the manufacturing space — workforce recruiting. The company’s progressive mindset has attracted a talented and diverse workforce, committed to the company’s culture and mission.
“I think there’s other modus operandi for organizations, where the employee can be more at the center,” says Mahler. “My equation is that happy employees equals great projects, equals satisfied customers, equals revenue.”
Adding up
Mahler’s math appears to be working out for ten23.
Back in July 2023, the CDMO unveiled the launch of a new quality control division, with services at both its Visp and Basel sites. The division will offer release and stability testing of clinical and commercial sterile drug products according to international CGMP standards.
With customer demand for sterile fill-finish services increasing, ten23 health announced this past fall that it is expanding the available capacity at its Visp sterile manufacturing facility by 50%, hiring more staff to accommodate an additional shift.
ten23’s new facility, also in Visp, will come online in late 2024/early 2025, with the first customer project and tech transfer already signed. The facility will offer two additional filling lines for sterile commercial supplies of ready-to-use syringes, cartridges and vials, and liquid or freeze-dried clinical and commercial vial supplies.
But even when it comes to growth, sustainability remains at the forefront for ten23.
“I believe in sustainability not only from a planet perspective, but also from a business perspective. While we are always thinking about other organic or inorganic opportunities for growth, growth needs to be well managed. As a company you want to grow sustainably,” says Mahler.
At a time when many pharma manufacturers are still looking at sustainable initiatives as a tickbox exercise, ten23 health, under Mahler’s passionate leadership, is proving sustainability’s true value to the industry.
“I wish there was a more focused thinking about sustainability from a right-to-operate perspective, but it doesn’t hold us back,” says Mahler.
