Dedicated Investments - One year ago, Siegfried launched its new slogan, ‘Expect more, create more value as an integrated supplier'. Since then, a lot of things have happened. For instance, the Swiss pharma outsourcing partner completed upgrading the Zofingen, Switzerland facility for high containment drug products and acquired Alliance Medical Products in Irvine, CA. Birgit Megges asked Marianne Späne, the company's Executive Vice President, Global Business Development, Sales and Marketing, how these pieces fit into Siegfried's puzzle of offerings to meet and even exceed their customers' expectations.

CHEManager Europe: How would you judge the response your new slogan created in the markets you are serving?

Marianne Späne: We are pleased with the slogan ‘expect more', as it represents Siegfried as a broad and full-fledged service partner. Combined with our redesigned website and exhibition booth, the slogan has been very well received by our customers. Our message is clear, and everyone understands Siegfried's position. When a company makes a statement as strong as ‘expect more' to reflect its primary corporate message, then expectations will be nothing short of the competition. As we combined the slogan with concrete promises for expansion in 2012, we had to underline the commitment with actions. I have to thank my team, because they walked that "extra mile" to meet and exceed customer expectations wherever possible.

What actions are you referring to?

Marianne Späne: We strengthened our position as an integrated supplier through investment in supporting technologies for our business. Recently, we completed upgrading the Zofingen, Switzerland facility for high containment drug products, and mid-year we obtained approval for development and production of highly potent drug compounds from "Swissmedic", the Swiss agency for authorization and supervision of therapeutic products. Thanks to this piece of the high-potency puzzle we can offer our customers a fully integrated continuous supply chain for high-containment products starting with API development through to commercial manufacturing of drug products.
In addition, we now offer micronization technology at both our global headquarters in Zofingen and at our U.S. site in Pennsville, NJ, which further supports our promise to customers. Moreover, we are expanding our warehousing, packaging and tableting capabilities to enhance oral applications production in Malta.

Didn't your stakeholders and customers expect more, a bigger step forward?

Marianne Späne: Naturally, they expect more, and I am pleased to say that they will receive more. At the end of June we acquired Alliance Medical Products, a sterile filling facility in Irvine, CA. This acquisition clearly demonstrates our commitment as an integrated service provider.
In addition to our existing oral formulation and manufacturing capabilities in Malta, we now offer sterile/aseptic development and manufacturing competencies in the USA. Combined with our current chemical facilities in Pennsville and in Zofingen, this additional site allows us to provide fully integrated services both in the US and in Europe.

Do AMP and Siegfried fit together?

Marianne Späne: AMP works with unique and interesting customers that ideally complement Siegfried's current customer portfolio. Essentially, this provides us with a great potential for new business opportunities. Our customers have expressed interest in forward integration, and we are convinced that AMP's customers will appreciate backward integration into API for some of their products.
Siegfried and AMP as one company provide a US-focused customer the possibility to expand into Europe and other regions. The 2012 CPhI convention coming up in October will be a great format for us to share with customers the unique opportunity they now have with our integrated sterile filling facility. In addition, we are planning a combined customer road show with AMP experts within the next months. It is great to see that AMP and Siegfried have a common desire for doing business together, and both sides collectively enjoy the forthcoming opportunities.

What, in particular, makes AMP such a good fit?

Marianne Späne: AMP is a unique fit for Siegfried because they are true specialists in producing sterile drug products, including sophisticated ophthalmics, and they offer a full range of aseptic-fill services for pharmaceutical, biotechnological and medical device companies. In addition to automated filling, they provide small-run manual filling for special cartridges, bottles, vials and syringes. We plan to expand and augment their existing development and contract manufacturing focus. We intend to do this by developing a portfolio to include our own IP combined with co-development and other creative business models customized to our customers' requirements.

AMP reports sales of about US-$ 20 million. Do you expect significant short-term growth potential?

Marianne Späne: Absolutely! With some interesting phase-3 projects in the pipeline there is real growth potential. At the same time we recognize that there is no guarantee that a phase-3 development will become commercial. Currently, there are many promising opportunities at the evaluation stage: we are assessing our customers' interest in the forward integrated opiate business and in sterile high-containment drug products. Market analysis tells us that around 80% of cytotoxic products are applied in sterile form. We therefore have sufficient opportunities on our plate.

Other Siegfried business segments are also developing positively. How do you view their growth potential?

Marianne Späne: We are growing our opiate portfolio via new products and improving and sustaining our existing overall portfolio with optimized processes. We naturally have to stay competitive and constantly offer lifecycle improvements. Also, we see an increasing interest in our oral formulation and manufacturing capabilities, either in terms of co-development, lifecycle management or contract manufacturing. As mentioned, we have expanded our Malta capacity in tableting, packaging and warehousing to cater for this growth.

You mentioned cost optimization. Is this possible with a purely Western-hemisphere dominated company?

Marianne Späne: It is an incredible challenge and we actively consider all opportunities to lower our costs at all times. For sure, we are not in a position to compete on costs alone. Therefore, we try to offset the competition by working with our Asian partner and our USP as an integrated supplier with an effective supply chain and great quality practices. Unfortunately, this is not always enough to obtain new business.
Based on these circumstances, we have chosen to invest in our own factory in Nantong, China - about two hours outside Shanghai - which will mirror our Zofingen site. We plan to offer non-GMP substances beginning in 2014 and GMP substances from 2015 onward. We are very excited about this opportunity, as we can offer a secondary cost structure strategy and we will gain access to new markets such as China, India and others.

How can Siegfried manage all of these projects simultaneously?

Marianne Späne: The key is a good team that shares the same strategy and is enthusiastic to be part of the growth and success of the organization. We recognize that it is not an easy path to follow. However, we have demonstrated that our talented team is strong enough to overcome such hurdles. Our people continue to be focused, very dependable and self-motivated. With a team like Siegfried, you can expect more.