By Andrew Goodsall
This article was created from the author's presentation at the 2018 Bioprocessing Asia conference, with GE Healthcare as principal sponsor. The BioProcessing Asia Conference series was created to provide a platform to advance the contribution of bioprocessing sciences towards the development and manufacture of affordable biopharmaceutical products in Asia.
Plasma-derived medicinal products are becoming increasingly important to the healthcare industry. The global immunoglobulin (IG) market, for which the majority of plasma is collected, is experiencing significant growth with an expected cumulative annual growth rate (CAGR) of 6.6 percent from 2018 to 2025.1 IG is used in the treatment of a variety of autoimmune and inflammatory disorders.2 The albumin market relies on the collection of sufficient plasma, as it serves a wide range of functions in patient treatment, such as supplementing blood volume during medical treatments, including those for trauma. Overall, these applications, as well as plasma’s use in injectable medications and testing reagents, make it a critical component of the biopharmaceutical industry. Nevertheless, the demand for it is rapidly outpacing the world’s supply. An outlook on the market shows plasma fractionators will have to look to innovation and other opportunities for supply, in order to meet the needs of the growing patient population who rely on plasma collection.
A Look At Global Plasma Collection
There are two methods to collect plasma for use in medicinal products. The first, recovered plasma, is plasma extracted from a whole blood donation centers. However, there has been a concerted effort by hospitals to reduce blood component wastage, resulting in a decline in the need for whole blood donations. The other is source plasma, which is derived from a process called plasmapheresis, where blood is collected from a donor and centrifuged. The cellular portion is then returned to the donor, and the liquid portion is sent to a donation facility or fractionation center. Currently, the U.S. supplies nearly 70 percent of the world’s source plasma,3 due to a lack of restrictions on paying donors (Most other countries do not offer compensation for plasma donations. There are exceptions in some European countries where donors are paid for the time spent but not for the actual plasma components.)
Looking at the capacity of source plasma donation centers over the last two decades, the number of U.S. plasma collection centers remained nearly the same in the five years leading up to 2013. As U.S. unemployment rose and more people sought extra income through plasma donations, the volume collected per center in the U.S. increased. Conversely, as employment recovered, volume per center flatlined. From 2013, plasma fractionators opened new collection centers to drive an increase in volume collected. Growth in the U.S. has since remained at a steady CAGR of 8 percent.
However, despite success in source plasma collection, recovered plasma collected globally has flatlined, leading to increased pressure on U.S. source plasma to increase and meet the growth in global demand (Figure 2).
It takes at least two years and anywhere from $3 million to $5 million to build a new donation facility for source plasma, making it a challenge to quickly grow supply. However, an outlook on the throughput from today’s key fractionators, which include CSL Plasma, Takeda (previously Shire), Octapharma, Kedrion, Biotest, and BPL, indicates the supply of plasma from the U.S. and EU will fall short of global IG demand (the single factor driving collection growth). (Figure 3).
Determining global IG demand can be complex. There is some visibility of current U.S. IG supply in the monthly data from the Plasma Protein Therapeutics Association (PPTA). What cannot be estimated from these numbers, though, is the latent demand for IG. Some areas of the world choose to ration plasma products due to cost constraints and other factors. For example, China has restrictions on importation of all products other than albumin. In addition, underlying drivers, such as new indications, earlier diagnosis, demographics, increased patient access expectations, and progressive adoption of standard of care for rare diseases, also contribute to the latent demand for plasma products. Fractionators must keep these factors in mind as they determine how much capacity they forecast and produce to meet future plasma demand, as it takes up to five years to build a new facility.
New Targets Present Opportunities For Revenue Per Liter
Increased efficiency and lowering the cost of drug manufacturing is a major focus in today’s biomanufacturing industry, and that also extends to plasma fractionation. An analysis of the average revenue per liter across the industry over the last decade shows a 2.9 percent CAGR decline over the last five years (Figure 4 ).
Approximately 18 plasma-derived biotherapeutic products can currently be produced from one liter of plasma, but there is not equal demand for each of these products. Slower demand for plasma-derived clotting factor concentrate and other novel treatments means these are extracted from the base plasma volume but are not part of the final liter fractionated. Demand does continue to grow for IG and albumin, hence the last liter produced out of any facility will be for only produce these two products, establishing the price achieved for the final liter at a lower point than the average. The cost of goods sold in the U.S. is $220 per liter (plus or minus 10 percent). Revenue per liter is a key element to understanding margins and profitability. Taking advantage of opportunities in process improvement will be critical in achieving higher yields and lower costs. With increased treatment of rare diseases, fractionators should be able to expand the number of specialty products extracted per liter. The first 20 percent of liters offer the highest price point at around $402 per liter, with final liters offering around $350.
Based on recent trends in both developed and emerging markets over the last decade, healthcare funding is targeting treatment of more rare diseases. Doing so creates an opportunity for fractionators to service new markets, expand revenue per liter, and ultimately maintain a consistent level of growth.
Andrew Goodsall has been a No.1 rated in Australian Healthcare & Plasma research since 1999 with UBS and Citi. In 2017, he co-founded MST Marquee Independent Research. This followed pivotal roles in healthcare, which included chief of staff to a reformist Aust Healthcare Minister. Andrew has served and continues to serve on several healthcare boards, including the NSW Northern Sydney Local Health District (seven major public hospitals) and the Australian Institute of Health and Welfare. Andrew and team continue to specialize in analysis of the Global Plasma products market from the financial perspective.