Press Room

Article / Oct 20, 2020

The Coronavirus Crisis: Challenges and Opportunities for CMOs, CDMOs and CROs

CheManager, 20 October 2020

Experts Share Their Opinions on How the Custom Manufacturing and Research Industry can Tackle the Impact of the Covid-19 Pandemic and a Demanding Economic Climate

20.10.2020 - The coronavirus crisis caused by the Covid-19 pandemic has uncovered problems that have been smoldering beneath the surface of the pharmaceutical industry — including CMOs/CDMOs and CROs — and need to be addressed. That supply chains are vulnerable to disruption when major development, production and transportation hubs are blocked or shut down has become painfully obvious.

The ongoing pandemic is putting pharmaceutical R&D strategies to the test and also challenging manufacturing planning and supply chain management. Particularly in this industry segment, the supply chain is global, complex and interconnected. Each link must be strong enough to ensure that the road from lab to final drug product is as smooth as possible, even under the most difficult circumstances.

In addition to the pandemic, the growing threat of a no-deal-Brexit amid old and new trade conflicts and increasing protectionism, is putting even more stress on companies operating in the pharma sector.

In cooperation with Wombat Capital*, a cross-border investment bank, CHEManager asked executives and experts of CMOs, CDMOs and CROs operating in the pharmaceutical sector to share their opinion on current challenges for their industry and how these challenges may influence changes in their market and opportunities.

Expert Interview: Jean-Luc Herbeaux

Jean-Luc Herbeaux

CEO

Degree in Mechanical Engineering, Master of Science and PhD in Mechanical Engineering

Jean-Luc Herbeaux studied in France (Diplôme d´Ingénieur from UTC) and in the USA (M.S.and Ph.D. in Mechanical Engineering from the University of Houston).

Jean-Luc Herbeaux started his professional career as Assistant then Associate Professor at the Kanazawa Institute of Technology in Japan.

From 2000 to 2020, Jean-Luc Herbeaux held multiple high-level leadership positions at Evonik, one of the world’s leading specialty chemicals companies, and before joining Hovione, was at the helm of Health Care Business Line of Evonik.

Jean-Luc Herbeaux joined Hovione as Chief Operations Officer in 2020 and was appointed CEO in April 2022.

16.10.2020 - So far, the pharmaceutical industry — including CMOs/CDMOs and CROs — has responded well to the outbreak of the Covid-19 pandemic. However, the coronavirus crisis has uncovered problems that have been smoldering beneath the surface and need to be addressed. That supply chains are vulnerable to disruption when major development, production and transportation hubs are blocked or shut down has become painfully obvious.

In cooperation with Wombat Capital, a cross-border investment bank, CHEManager asked executives and experts of CMOs, CDMOs and CROs operating in the pharmaceutical sector to share their opinion on current challenges for their industry and how these challenges may influence changes in their market.

What in your opinion and from your perspective are the main impacts of the coronavirus pandemic on the drug supply chains?

Jean-Luc Herbeaux: While Covid-19 placed some strain on global supply chains and logistics, the pharma industry overall showed surprising resilience considering the severity of the situation.

The pandemic highlighted the strong reliance and dependence of drug and medical product supply on China and India and the limitations of such a supply model. It caused governments to look at pharmaceutical manufacturing in a more strategic manner, including potential repatriation, to guarantee access to life-saving medicines to cater to the most extreme demands. A new type of “nationalism” promoting preferential (or even exclusive) access to therapies and vaccines has emerged in the meantime and it has the potential to greatly disrupt the established global manufacturing and supply models.

Many Western CDMOs have already shifted operations back to the USA and Europe as intensive business activity in China has driven up labor costs. In addition, national policies, trade-related developments such as Brexit and the US-China dispute and impacts of pandemics are likely to require repatriation of at least part of the supply chain in many countries. Could CMOs/CDMOs be beneficiaries of restructured supply chains?

J.-L. Herbeaux: CMOs/CDMOs have a chance to benefit from the repatriation trend, which already started some years back. The first wave of relocation, which started some 4 or 5 years ago, stemmed from quality and regulatory considerations. This repatriation was very beneficial to CDMOs with assets and quality systems in good standing as they were able to gain access to business which had escaped them up to that point.

The new wave seems to be driven by countries and their citizens coming to terms with the fact that most of their medical supplies are from foreign countries and entities. The recent Covid-19 crisis has revealed the limits associated with reliance on third party country supplies and the ongoing Covid-19 vaccine and therapy “nationalism” further exacerbated the sentiment that repatriation of pharma assets is now a strategic priority.

We ought to recognize that the Covid-19 pandemic is extreme in terms of impact and medical supply needs. It has overwhelmed the global supply chains in unprecedented ways and no economically sound supply strategy could have prepared us for an event of such global proportion. In these special times, there is a risk of overheating and of wrong capital investment decisions. Investments need to make sense not only for the short term (i.e. in Covid-19 times) but also for the long haul (once the world returns to a more normal reality). In this overheated environment, experienced western CDMO´s with flexible assets and operating models and with meaningful engineering capabilities are probably the best bet for this industry. They know how to ramp up and run assets in an effective and nimble manner and make best use of these assets now and in the future thanks to their ability to accommodate an ever-changing portfolio.

What do you think the impact of the repatriation of the drug supply chain will have on the M&A activity in the CMO/CDMO industry? Do you think that this would create an impact on valuations?

J.-L. Herbeaux: The pharma industry is very likely to weather the Covid-19 crisis better than other sectors and accordingly, one can expect valuation to go up at a time when investors may be looking for safe heavens. The demand-supply balance for M&A candidates in the USA will also drive multiples. One can foresee that the high availability of cash and short-term hype may result in some misguided investment decisions in parties and/or assets, which do not represent mid to long-term value. In the pharma CDMO space, assets are important but not sufficient. The right-to-win stems from established competencies in quality, regulatory and manufacturing service excellence and these attributes take time to develop.

Has the inability to hold face-to-face meetings with prospective clients and conduct client visits to sites affected your new business development since the outbreak of the coronavirus pandemic?

J.-L. Herbeaux: New business development has become more difficult as travel restrictions have curtailed opportunities for face-to-face interactions. Physical closeness is known to help individuals (or groups of individuals) form interpersonal relations and develop trust. Proximity and face-to-face communication are therefore particularly important for first-time interactions. We see this clearly in our commercial activities: it is a lot easier to maintain or even further established relationships than to develop new ones. Add to this the need for pharma companies to audit new partners and you will understand why existing partnerships are preferred to new ones at this moment.

The CMO/CDMO industry has managed to support efforts to develop vaccines and therapeutics for Covid-19 despite already being at a high level of utilization. What made that possible?

J.-L. Herbeaux: From what is published, there is significant cash being deployed to ramp up vaccine production and capacity repurposing or reactivation is also on the agenda. Some of this cash came from governments and public organizations to secure supply.

As for Hovione, we are involved in several steep capacity ramp-up exercises and these have been made possible by very strong partnerships with our clients and suppliers. Everyone understands that these are extraordinary times, and all agree that only shared commitments can result in success. The rest is fueled by a sheer desire to save lives. We push our organizations, systems, and processes to new levels of speed and productivity relying on decades of experience, expertise and best-in-class practices. Under these extreme conditions, CAPEX, resources, and associated capacities are deployed faster and products become available in record time. This is what leading and agile CMOs do for a living: deal with the cross-functional and cross-discipline complexity associated with production ramp-up and compress timelines.

For the biopharma CMO/CDMO industry, the pandemic crisis has created great opportunities. What is your opinion on whether and to what degree the CDMO industry will enjoy long-term benefits from its role in tackling the current crisis?

J.-L. Herbeaux: One may assume that the public opinion of the pharma industry will have improved during the last months and that any company, including CDMOs, which contributed to solving or alleviating the Covid-19 humanitarian crisis, would have a chance to boost its image externally but also with its own staff. There is little which can compete with being a contributor to tackling a global health crisis and saving lives.

Leading CDMOs have certainly showed that they can be trusted and that supply chains supported by CDMOS/CMOs are robust. Moreover, their demonstrated ability to step up and make capacity available on short notice, absorbing much of the complexity associated with reaching new levels of supply, has positioned CDMOs at the core of the industry’s journey to provide therapies and vaccines to billions of individuals. The co-dependence between CDMOs and Pharma companies is stronger than ever, and this should increase the propensity of pharma to outsource.

One of Hovione’s facilities is located in Macau, China. How was the site in particular and your business in China in general affected by the outbreak of the coronavirus pandemic?

J.-L. Herbeaux: Macau is a good example of Hovione’s success in controlling the risks associated with Covid-19. Extensive measures were quickly put in place to protect the team members and to ensure the continuity of our manufacturing operations. Many of the raw materials for Macau come from mainland Chinese suppliers and the site was also able to secure its supply chain. The site was even able to adapt to repair specialized equipment with its own staff as technical visits from suppliers were not possible. Our other sites, which have also been running without interruption or disruption, learned from the Macau response and organization. Best practices were quickly rolled out globally under the leadership of a global task force. All our sites are now operating safely according to this new reality. One of our most important decisions has been to offer free testing to our employees with an elevated risk profile, e.g. as they return from holiday.

The race is on to develop treatments and vaccines against Covid-19, and so is the need to assure supply of these potential drugs and vaccines. Pharma companies are leveraging their internal manufacturing networks but also partnering with CMOs/CDMOs. What supply and manufacturing strategies/alliances are in play?

J.-L. Herbeaux: The Covid-19 pandemic has engendered an all-out search for treatment options. Many hundreds of compounds for prophylactic and therapeutic use have been tested in the race against this deadly disease. No drug candidate or route of administration has been neglected and innovative formulation concepts are given due consideration under the assumption that regulatory authorities will likely grant accelerated approval to treatment options which show positive clinical outcomes.

The patient population is considerable, and the urgency is absolute. The manufacturing capacities for the few treatments that have demonstrated some efficacy (or promise of efficacy) to date are being ramped up to scales and with speeds which transcend anything the industry had seen so far.

Pharma companies have sought the help of their partners to ramp up raw material supply and custom manufacturing services to help them deal with this colossal challenge. In times of pressing requirements, strong partnerships are key and unsurprisingly pharma companies have tended to reach out to their existing partners – especially those who demonstrated the ability to meet complicated supply challenges involving new asset deployment and commissioning. We, at Hovione, are part of this select group of CDMOs working closely with partners on both new formulation concepts and steep upscaling of industrial production capacities.

“Emerging”, “virtual” and other small (bio)pharmaceutical companies are driving the discovery and development of new drugs but are mostly dependent on the availability of financing – which could become more restricted due to the economic downturn cause by the economic and epidemiologic disruptions to the global economy. As emerging biopharma companies are important customers of CMOs/CDMOs, how is this going to affect your business?

J.-L. Herbeaux: As a leading CDMO known for helping pharmaceutical companies of all sizes bring new and off-patent drugs to market, Hovione is of course dependent on the health of the biotech industry and its pipeline. So far, our business has remained extremely vibrant as our customers do not appear to be short of cash and pipeline projects are progressing as per plan. The last 3 years have been good in terms of biotech financing (the biotech sector in NASDAQ is at an all-time high). So, one may contend that biotech companies’ strong cash positions will allow them to weather the storm as long as the crisis does not perdure and investments do not stop abruptly. After a few months of increasing disruptions in clinical trials due to Covid-19, data now suggest that clinical trial disruptions have started to recede. Most trial disruptions appear to be due to suspension of enrollment – not financials.

Read the full article at CheManager

Also in the Press Room

See All

The podcast "The Next Discovery" is a six-episode series created by Observador, a leading portuguese digital newspaper and radio station, in partnership with Hovione. And what if some of the scientific discoveries that can improve the lives of millions of people were happening right now in Portugal? The Next Discovery. Listen to the first episode of the podcast here, featuring Diane Villax, co-founder of Hovione. [English transcription] Welcome to The Next Discovery. This is a series of conversations, created in partnership between Observador Lab and Hovione, an international pharmaceutical company of Portuguese origin, that will open the doors to its world and share real stories of science, innovation and global impact. Over six episodes, we will meet the people behind technologies that help develop and manufacture innovative medicines for the world’s largest pharmaceutical companies that improve the lives of more than 80 million patients every year. I am Nelson Ferreira and, in this first episode, we will discover how an unlikely story, which began in a basement in Lisbon, became a story of global leadership. To talk about this legacy, I have the honour of welcoming Diane Villax, co-founder and non-executive board member of Hovione, who at the age of 91 remains a living witness to this journey. Nelson Ferreira (NF): Welcome, Mrs Diane Villax. Let us begin our conversation in 1959. Hovione was born in an unlikely way, in a basement in Lisbon, founded by your husband, Ivan Villax, by you and by two other partners. How did you manage family life and, at the same time, the birth of a pharmaceutical company, all in the same space? I imagine that created some interesting logistical challenges. Diane Villax (DV): From the beginning, we decided that we would manufacture raw materials for the pharmaceutical industry, that is, the active ingredients of medicines. We had no money, so it had to start from our home, which was in a residential neighborhood in Lisbon. Right from the start, we divided the tasks. My husband, a brilliant Hungarian chemical engineer, would be the inventor, the producer and the salesman, while I would take care of all the administrative side: imports, exports, accounting and banks. I kept those responsibilities for at least 30 years. At the same time, we also thought about the values that would guide us over this long period: transparency, innovation, the pursuit of excellence and great consideration for everyone who would come to work with us over the years. NF: Very early on, your husband made it clear that Hovione would not compete on low price, but rather on quality and on solving complex problems. What was it like to apply this principle of rigour when resources were still scarce? Especially because, from day one, it always seems to me that your objective was global. The world would be your market. DV: From the beginning, we felt that Portugal, with a population of 10 million people, would not be a very significant market, and that the world would be ours. Perhaps we were a little naïve, because we were entering a global market that was already quite sophisticated. But the decision was made and we moved forward. We moved forward and were fortunate that Japan discovered us quite quickly. They came knocking on our door, because of course we did not have the means to knock on theirs. At that time, they did not manufacture; they only formulated, so they needed to buy raw materials. My husband had invention patents for independent processes and there were long discussions. They felt that our technology was good, our IP was very robust and our quality was excellent. This led to a cooperation that lasted 10 or 15 years and was very profitable for both sides, I believe. NF: In the 1980s and 1990s, Hovione took a more significant leap forward. What were the decisions, the technological bets or even the moments of greatest courage that allowed this small Portuguese company to become a leading multinational? DV: In 1982, after a successful inspection by the FDA, the regulatory authority in the United States of America, we entered the American market with our generic doxycycline antibiotic. The inventor’s patent had already expired and we had an independent manufacturing process. It was a huge, demanding and competitive market, but one that respects good service and quality. And it was indeed a major leap, because the market was so large that we had no real sense of what it would mean, and demand was much greater than what we were able to produce. I remember, it must have been the summer of 1983, many people probably had to postpone their holidays to the autumn or winter, because missing delivery deadlines was not an option. Later, in the 1990s, we entered a new business area: services. We realized that large American pharmaceutical companies, as well as small biotechs, were increasingly inclined to outsource the development work for new molecules. This is a very long period, which can take four, six or even 10 years — the development process for new molecules before they are approved by regulators and become commercial products. So we began to offer this development service, and it went very well. From there, we developed new technologies, such as spray drying, for poorly soluble molecules, because this could greatly increase their bioavailability. Today, this services area is our largest business segment. NF: Hovione today works with 19 of the world’s 20 largest pharmaceutical companies. How do you maintain the agile, pioneering spirit that was born in that basement, when today the company has 2,600 employees, more than 300 scientists, and has even become the largest private employer of PhDs in Portugal? DV: Agility has to be maintained. For example, during the pandemic, we suddenly received large, unexpected orders to manufacture a component of Remdesivir, which was the product authorized to help Covid patients. So agility has to be maintained, and we always maintain our quality. Today, with more than 60 years of history, clients come to us because they know they can count on our quality and on our responsibility to produce and deliver on time what they order. NF: There is another impressive figure here. Your products reach 80 million people every year and Hovione participates in up to 10% of the new medicines approved annually by the FDA in the United States. When you look at this impact, do you feel that the dream of 1959 has been fully achieved? DV: I think it has been far exceeded. When we founded Hovione, my husband, who was a scientist, simply wanted to have his own laboratory. But he never imagined that we would develop in such a way that, today, we are sought out by major international pharmaceutical companies, which frequently come to us. NF: This is a series about science, but it is also about people. And the rigour, ethics and long-term vision that Diane always brought to management are still present at Hovione. What message would you leave to the scientists who join Hovione today with the mission of finding the next discovery? From what I understand, Diane makes a point of welcoming them whenever they join the company. DV: Yes. Four times a year, twice in English and twice in Portuguese, I speak to the newcomers at Hovione, giving them a very brief account of our journey, our values, our objectives, our dreams, the challenges we faced and how we overcame them to get to where we are today. And I always recommend that anyone who joins this company must work with passion. They must work with passion and always remember that our work is to produce medicines for those who need them. We have the privilege of serving patients. We are a company that works for society. I think “In it for life”, which is our motto, has a lot to do with us, because we have been here for 67 years as a family company, and that is how we intend to continue for many good years to come. Above all, in the healthcare sector, there is a great advantage, because we can look at the long term. We do not have to think about stock market results every quarter, as public companies do. And, on the other hand, we are here precisely to give life to those who need it. “In it for life.” NF: At the age of 91, how does Diane herself maintain this passion and continue to make long-term plans? DV: Because I was a founder of this company. I see it progressing and developing successfully, so it is a joy for me. And I have a large family coming after me. I have six grandchildren and seven great-grandchildren, and I hope to leave the company to them so that they can continue it as I managed it. NF: That is truly inspiring. Mrs Diane Villax, thank you very much for sharing the memories and inspiration of this legacy, which remains very much alive. It was a privilege. This was the first chapter of The Next Discovery. In the coming weeks, we will continue to open the doors of Hovione to discover how Portuguese talent is leading the world, from complex chemistry to particle engineering, from respiratory therapies to next-generation biological medicines. You can listen to the next episodes on observador.pt and on your usual podcast platform.

Article

Observador Lab, 18 june 2026

Podcast “The Next Discovery” (EP1) - From a basement in Lisbon to global impact

Jun 18, 2026

Hovione is bringing momentum to the intranasal field after announcing that its lead single-use nasal dry powder device, developed in collaboration with Industrial Design Consultancy Ltd (IDC), is now available for commercial partnerships. The milestone marks the transition from prototype to a fully integrated intranasal drug delivery platform that spans Hovione’s end-to-end partnership capabilities–from API synthesis through advanced formulation and particle engineering to drug product manufacturing, including device supply and advanced analytical tools for nasal performance characterization. The platform’s single-use device is designed to be manufacturable at scale and to leverage existing advanced particle engineering and drug product manufacturing capabilities, a practical advantage that can shorten timelines to clinic and commercialization while reducing development risk and cost. The device’s patented mechanism supports targeted nasal deposition, including access to the upper olfactory region. This enables rapid systemic absorption and potential nose-to-brain delivery pathways that are increasingly important for CNS and emergency-use indications. Beyond the single-use format, Hovione and IDC are advancing a multi-dose variant to broaden applicability across dosing regimens and therapeutic areas. The collaboration is backed by an intellectual property portfolio and initial patent grants, positioning the platform as a turnkey option for pharma partners seeking a single integrated supplier for both drug substance and device. This development arrives as intranasal delivery gains traction for systemic, CNS and rapid-onset therapies. This is precisely the focus of the upcoming 4th Nasal Formulation & Delivery Summit, for which Hovione is a key sponsor. The annual summit unites formulation, delivery and product development leaders to tackle drug-device compatibility, translational preclinical models, and strategies for scalable, regulatory-ready intranasal programs. Hovione’s recent progress will be highly relevant to attendees looking to de-risk nose-to-brain and systemic intranasal programs. Read the full article at News-Medical.net

Press Clipping

News Medical Life Sciences, 1 June 2026

Hovione advances intranasal drug delivery with commercial-ready dry powder platform ahead of 4th Nasal Formulation & Delivery Summit

Jun 01, 2026

Every year, the largest bank in Portugal, Caixa Geral de Depósitos recognizes some of Portugal’s brightest young minds through the Caixa +Mundo Awards, providing nearly €800,000 in scholarships to students as they pursue higher education. In this year´s edition, Caixa named the award bestowed upon students pursuing science for Diane Villax. This prestigious honor places Diane Villax among the award’s namesakes – a distinguished group of prominent personalities who have made notable contributions to Portugal´s socio-economic, cultural, political and scientific development over the last 50 years, such as António Ramalho Eanes, Mário Soares, José Saramago, Sophia de Mello Breyner, Leonor Beleza, Elvira Fortunato, Rui Nabeiro, Américo Amorim, and José Manuel de Mello. Diane Villax will also honor the seven scientific award winners by personally meeting with each of them, and following their journeys as future innovators and leaders. But this honor is about far more than one individual. It is a celebration of an entire organization and the people behind it. For 67 years, generations of dedicated teams have worked together with passion, purpose, and excellence to manufacture life-saving medicines and advance science that has a real impact on people. This recognition belongs to all of us.

News

Prestigious Caixa +Mundo Award named in honor of Diane Villax

May 14, 2026

Also in Events