WuXi Biologics poised for accelerated growth CEO tells JPM25, as BIOSECURE Act looms
WuXi Biologics CEO Chris Chen in a presentation on Wednesday at the J.P. Morgan Healthcare Conference in San Francisco said the Chinese-based CRDMO expects to see an acceleration in revenue growth in 2025.
“We are actually poised for strong growth” this year, according to Chen, who credited WuXi Biologics’ end-to-end CRDMO services — as opposed to the traditional CDMO model — for the company’s projected success this year and in future years.
In 2024, WuXi Biologics added a record 151 integrated projects to its portfolio, bringing the total to 817, with over half of the new projects originated from U.S. clients. The company in a Thursday press release said it underscores “strong client trust and the company’s resilience amid external challenges.”
Chen made the case that the company’s “follow the molecule” and “win-the-molecule” business models will not only result in sustainable growth in terms of revenue but also profit — a financial metric that WuXi Biologics needs to improve. In the first half of 2024, WuXi Biologics reported a 24% drop in net profit, while securing more than 60 new contracts in the first six months of the year — including about half from U.S. companies.
The U.S. continues to be the company’s largest market, despite the fact WuXi Biologics is among five China-based biotech companies named in the BIOSECURE Act, which seeks to prevent U.S. federal funds from supporting certain Chinese biotech “companies of concern.” While the passage of the BIOSECURE Act has stalled in Congress, it’s likely to become a law given the anti-China sentiment of the incoming Trump administration and Republican-controlled House and Senate.
Asked during his JPM25 presentation on Wednesday about the looming BIOSECURE Act, Chen acknowledged that the proposed legislation has negatively impacted business for WuXi Biologics, but it has also served to make the company more resilient.
“Last year, there was so much noise outside — we looked internally” amid the “clouds” of geopolitics and “accelerated our efforts to diversify and optimize operations, enhancing our resiliency,” Chen said. “I’m glad that the BIOSECURE Act didn’t pass last year. As I said earlier, we cannot change the dynamics outside … the geopolitics is another risk factor.”
Earlier this month, WuXi Biologics sold its vaccine manufacturing facility in Dundalk, Ireland, for approximately $500 million to Merck, known as MSD outside of the U.S. and Canada. MSD and WuXi Biologics have been collaborating on the site in Dundalk since 2019, when construction began. The official handover of the facility, which started operations in 2021, is expected to be completed in the first half of 2025.
During Wednesday’s JPM25 presentation, Chen said that the sale of the Irish facility to Merck was “not at all” related to the BIOSECURE Act. “It has nothing to do with geopolitics.”
At the same time, Chen said WuXi Biologics is increasing its investment in the U.S. The company is building a $300 million manufacturing facility at The Reactory biotech park in Worcester, Massachusetts, which will be completed in 2027.
Stainless vs. disposable bioreactors
At JPM25, Chen touted WuXi Biologics’ adoption of disposable manufacturing, which he said has proven to be cost-effective, flexible and agile, effectively accommodating both small- and large-volume products.
According to Chen, single-use technology has been scaled out to large batch sizes comparable to stainless steel tanks.
“When we started the company, we said we’re going to bet 100% on disposable,” Chen said. “Over the past six years, we have run 300 batches already … I want to put an end to this debate in our industry [over] stainless steel or disposable — which one is better? ... We believe that disposable is the future.”
Germany-based CDMO Rentschler Biopharma claims they pioneered single-use manufacturing and were among the first adopters of disposable bioreactors in the industry. Rentschler offers both stainless steel and disposable equipment. The company has stainless steel bioreactors up to 3,000L as well as single-use bioreactors up to 2,000L.
Rentschler CEO Benedikt von Braunmühl told Pharma Manufacturing on Wednesday that his company sees the value of offering both stainless steel and disposable manufacturing.
At Rentschler’s production facility in Milford, Massachusetts, it has only single-use bioreactors, while stainless steel and single-use are leveraged at the company’s headquarters in Laupheim, Germany. “Both have advantages and disadvantages,” Braunmühl said.