The demands of the pharmaceutical industry are driving strong growth in the market for outsourced chiral technologies, according to Frost & Sullivan, which predicts that the market for chiral compounds destined for the drug industry will rise from $7.0 billion (€6bn) last year to $14.9 billion in 2009.
Today, the rapidly developing small molecule chiral technology industry is witnessing a flurry of activity. While traditional methods of chiral production such as resolution and chiral pool chemistry are firmly established, emerging asymmetric and biological methods are generating huge interest and are the focus of intensive research, notes the report.
Meeting demand from the pharmaceuticals industry for the production of optically pure molecules - including active pharmaceutical ingredients and intermediates which are used as the framework for single enantiomer drugs - remains the primary focus of contemporary chiral technology, according to F&S.
"A study of 40 significant chiral technology companies suggests that asymmetric techniques are amongst the more popular additions to chiral technology toolkits with 69 per cent of competitors showing some area of asymmetric expertise," said the report's author, Matthew Moorcroft, at an analysts' meeting last week.
"Of these companies, the larger players in the fine chemical market, such as Avecia, BASF, Lonza, Degussa, Dow and DSM have integrated their asymmetric expertise into an expansive technology portfolio in a real drive to lure the custom of the larger pharmaceutical companies," he added.
This trend will lead to an expansion in the global market for asymmetric technologies from $2.5 billion in 2002 to $5.4 billion in 2009, a compound annual growth rate of 12%, according to the report. However, this growth will be eclipsed by that of the new biological methods, forecast to have a CAGR of 25% to take them from a market of $700 million last year to around $3.3 billion in 2009.
However, fine chemicals companies are now facing a significant problem as their biggest customers - large pharmaceuticals - cut their outsourcing activities in an effort to save costs, according to Moorcroft.
Under pressure to sustain favourable bottom lines, companies are now looking for new customers and business opportunities in the form of smaller pharmaceutical firms that have limited manufacturing capacity but promising pipeline drugs.Such a move is likely to cause a paradigm shift within the market, as fine chemicals companies begin to rely more and more on smaller pharmaceutical companies to extend their customer base.
In addition, growing interest from biotechnology companies in search of a manufacturing partner for small molecule chirals offers fine chemicals companies an opportunity to replace critical revenues lost due to sluggish pharmaceutical companies, he said.
One issue is that fine chemicals companies incur huge costs in adding chiral technology to their portfolios; in most cases they do this by acquiring a university spin-off. Maintaining this technology poses further problems due to high costs of throwaway catalysts, compelling companies to develop reusable systems. However, as chiral techniques mature, declining costs will allow all companies access to public-domain technologies that were otherwise outside their operating budgets.