Understandably, much of the last few years – and the rise of peptides – has been completely dominated by one or two products, namely the now ubiquitous GLP-1 drugs from first Novo Nordisk and then Eli Lilly. Such has been the success of these products that they have captured the attention of much wider audiences even outside of pharma, but this success has caused huge ripples across the industry as we adapt to how to supply these drugs. From being unheard of at the beginning of the decade, Americans spent $72 billion on GLP-1 drugs in 2023, and as soon as 2030 the market could hit a staggering $130bn in global sales.
The immediate consequence has been the need to rapidly expand manufacturing capacity, not only within innovator companies but also throughout the wider CDMO ecosystem. And this is where the story has become much more interesting and nuanced in the last few years, as coupled with the unprecedented volumes of production needed to support the blockbuster drugs, we also have an expanding drug pipeline that has been encouraged by the low risk, tolerance and massive potential rewards of this drug class. So, dig below the surface of the GLP-1 drugs, and this is creating a great deal of bottlenecks in terms of access to contract services, and it’s no surprise you have seen many CDMOs invest in this opportunity.
The other complication is that much of the largest capacity expansions from CDMOs have been in direct response to the success of Ozempic, Wegovy, Mounjaro and Saxenda. Meaning, essentially, much of the large-scale capacity and interest in working with innovators has centred around securing massive contracts for already commercialised drugs. Therefore, we still have a shortage of capacity, and especially suitable capacity, to support the rapidly expanding pipeline of new peptide drugs coming through, which obviously need greater support, lower volumes and more contractual flexibility. Our strategy is to get in early with these partners and work with them on undertaking thorough process development – and remember, these firms are 90% venture-backed – and I think we are unusual in also specialising in helping partners like these earlier with medicinal chemistry work.
In fact, setting aside GLP-1 drugs, peptides have been quietly gaining traction over the past 10 years, with a growing number of targets entering the discovery pipeline. This trend has accelerated rapidly following recent successes, and investors are now far more willing to advance these targets. As a result, the pipeline today is much larger than it was even a few years ago.
For example, a decade ago there were fewer than 100 peptides in various phases of development, and yet this year that has now jumped dramatically to more than 350+ (and there are more than 500+ trials underway – 80+ of which are for oncological peptides) – with approximately ~10 approved or approaching approval and about 50 in Phase III.
