Formosa Laboratories, a leading active pharmaceutical ingredient (API) manufacturer, is making significant strides in expanding downstream into injectable drug production. On the 16th, the company announced on its official website that its high-potency injectable facility has passed an on-site FDA GMP inspection. This indicates that the U.S. approval for the anti-breast cancer drug Eribulin Injectable is on the horizon, opening the door for commercial-scale contract development and manufacturing (CDMO) orders. This milestone is expected to drive significant growth in revenue next year.
The FDA conducted its first on-site GMP inspection of Formosa Laboratories' high-potency injectable facility in July, and the company responded to improvement requests in August. On September 16th, it officially announced that the facility had passed the FDA's on-site GMP inspection. Following the news, the company's stock price surged nearly 3% during intraday trading.
The company's CDMO customers come from the U.S., Europe, China, and Taiwan. In particular, antibody-drug conjugates (ADCs) now account for 20-30% of Formosa’s CDMO revenue. The company is currently expanding its production capacity by fivefold, a process expected to be completed by the third quarter. In addition, Formosa recently acquired North American CDMO company Synchem, aiming to accelerate its market expansion in the U.S. and tap into new opportunities, especially for Chinese-developed drugs in the U.S.
Formosa Laboratories' primary business in injectables is CDMO, serving clients in Europe, the U.S., China, and Taiwan. Over the past few years, orders have mostly consisted of small-volume drug development projects. However, with the FDA GMP on-site inspection now successfully passed, the company can begin taking on commercial production orders and potentially secure technology transfer contracts. This is expected to significantly boost revenues.
On the proprietary product side, Formosa’s anti-breast cancer injectable drug is already available in Taiwan and has been approved for national health insurance pricing, with sales expected to begin in the third quarter. The recent FDA inspection is linked to the company's application for U.S. approval. Analysts believe that U.S. approval is now imminent, and the eventual launch of the drug in the U.S. is expected to become a key driver of future revenue growth.
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