The global market for inhaled drug delivery devices is forecast to reach US$43 billion in 2024, growing at an estimated CAGR of 3.3% between 2016 and 2024.
The respiratory sector is one of the most highly regulated, resulting in high barriers to entry. A number of key drugs are shortly coming "off patent", resulting in a number of new generic entrants and associated opportunities for Bespak to supply both metered dose inhaler (MDI) and dry powder inhaler (DPI) devices. Although sales remain relatively flat in the traditional Western economies, significant volume growth is being seen in emerging markets, with the Brazilian, Russian, Indian and Chinese (BRIC) markets becoming more important to Bespak.
The Group intends to increase its share of the respiratory market through the development of new drug delivery devices; selling into new and developing geographical markets; and offering customers finished dose formulation and manufacturing services as well as integrated drug/device development, formulation and manufacturing services. The Group intends to maintain its competitive position by continuing to leverage continuous improvement activities as products move into the mature stage of their product life cycle. Endorsing this strategy, in FY2017 we signed a significant new commercial supply agreement for Bespak's proprietary respiratory devices with AstraZeneca. This is a multi-year agreement for the scale-up and supply of Bespak's proprietary pressurised metered dose inhaler (pMDI) valves and actuators for AstraZeneca's Bevespi Aerosphere® inhalation aerosol which was approved by the US FDA in April 2016 and launched in the USA in January 2017.
The global injectable drug delivery market is forecast to reach US$625 billion in 2021, growing at an estimated CAGR of 11.5% between 2016 and 2021. Growth is being driven by a large number of new drugs coming to the market for the first time that require delivery by injection. Whilst Bespak currently has a negligible share of this market, it is estimated that c.40% of all new drugs in development will be delivered parenterally and may, therefore, require some form of auto-injector.
Many of these new "large molecule" biologic drugs are highly viscous and require specialist devices to enable them to be effectively administered, often by patients themselves in a non-clinical environment. The continued drive to greater self-administration with the associated improvements to patient compliance, patient outcomes and healthcare economics will create significant opportunities for the Group to develop and manufacture auto-injectors to meet these needs.
In 2013, Consort Medical commercially unveiled the Syrina®, Vapoursoft® and Lila® injection technology ranges. In 2014, Consort Medical commercially unveiled Lapas®, a new range of innovative wearable bolus injection devices powered by Vapoursoft®. In FY2016, Bespak unveiled the Syrina® 2.25, one of the most compact versions of auto-injector available today utilising a standard 2.25ml pre-filled syringe. In FY2017, Bespak unveiled its latest addition to the Syrina® range of auto-injectors: the new Syrina® AR 2.25 auto-injector, suitable for delivering volumes of up to 2.0ml using a standard 2.25ml pre-filled syringe. Syrina® AR 2.25 provides patients with a fully-automatic two-step, compact device for the self-administration of viscous drug formulations smoothly and safely in less than 15 seconds. Designed with a hidden needle, Syrina® AR 2.25 offers automatic needle insertion and retraction, as well as drug delivery with a single push-on-skin operation. Syrina® AR 2.25 has been tailored specifically for higher viscosities while still enabling the safe use of glass syringes.
All of these technologies leverage Bespak's expertise and IP in gas propulsion and, using IP acquired through the acquisition of The Medical House, combine them into a family of innovative next-generation auto-injectors. These innovative drug delivery devices demonstrate Bespak's capabilities from device feasibility, concept and initial design through device development and also demonstrate the ability of the Innovation team to deliver product diversification opportunities in the drug delivery sector.
Consort Medical's Syrina®, Lila® and Lapas® range of auto-injectors positions the Group well to participate in this growing market. Our strategy is focused on the commercialisation of the existing pipeline in conjunction with the development of further IP and the exploitation of "innovation on demand" opportunities through the growing Innovation team in Cambridge. Endorsing this strategy, in FY2017 we signed a significant new master development agreement for our proprietary Vapoursoft® Syrina® auto-injector technology with a leading global biopharmaceutical company. Consort Medical intends to continue to move up the value chain by offering assembly and drug handling and will continue to look for additional, selective acquisitions in this area.
The global nasal drug delivery technology market is forecast to reach US$64 billion in 2021, growing at an estimated CAGR of 6.5% between 2016 and 2021. Growth is being delivered from two main areas. Firstly, a number of existing branded drugs are coming off patent leading to generic entrants, all requiring their own delivery system as the original device associated with the branded drug is normally unavailable to them. Secondly, the nasal drug delivery route is extremely effective and a number of existing and new drugs are being reformulated to enable delivery in this way, increasing demand for this type of drug delivery product. This is now a strategic market for Consort Medical and it currently has two development pipeline opportunities.
The Group's strategy for the nasal market is focused on the delivery of Bespak's existing development programmes plus further exploitation of the Group's growing IP portfolio via a number of "innovation on demand" opportunities. In addition, the Group intends to offer customers finished dose formulation and manufacturing services as well as an integrated drug/device development, formulation and manufacturing services.
The global ophthalmic drugs market is forecast to reach US$21 billion in 2022, growing at an estimated CAGR of 5.2% between 2016 and 2022. The global ophthalmic drugs market is driven by key factors such as rising prevalence of ocular disorders such as diabetic retinopathy and macular degeneration, largely driven by the rising percentage of ageing population in the world.
In FY2016, the Group was awarded a new strategic development and manufacturing agreement with retinal therapeutics company, Oxular Limited. The contract is related to novel ocular device and drug applications designed to access specific small spaces in the eye and to provide unique drug distribution to treat retinal diseases. As well as representing the Group's first combined device/ formulation contract, it also extended the Group's competencies into the ocular therapeutic area, in line with our stated strategy.
Aesica's oral delivery capabilities and drug formulation and manufacturing services are highly complementary to Bespak's business. The global oral drug delivery market is forecast to reach US$100 billion in 2018, growing at an estimated CAGR of 9.4% between 2013 and 2018. The implementation of different technologies for oral drug delivery is changing the market scenario, with this area receiving high levels of attention from pharmaceutical companies due to the advantages that research can provide, such as reformulations, which can reposition drugs and delay patent expiry.
The Group's strategy is to continue to drive organic growth in oral drug formulation and manufacture by building on Aesica's foundations of new business development, key account management, project management and continuous improvement.
Consort Medical's approach to the nicotine delivery sector was to industrialise and commercialise Nicovations Limited (Nicovations) Voke® device, an MHRA approved nicotine inhaler for harm reduction in smoking. Inevitably, not all of Consort's development projects reach commercial launch, and on 3 January 2017 we announced that Nicovations had terminated its supply agreements with Bespak for Voke®, exercising its contractual right in the event that Voke® was not commercially launched before 31 December 2016. Confidential settlement terms have since been agreed with Nicovations.
Point of Care (POC) Diagnostics
The global point of care diagnostics market is forecast to reach US$37 billion by 2021, growing at an estimated CAGR of 9.8% between 2016 and 2021. Market growth is being driven by the combined benefits of increased patient compliance, improved patient outcomes and lower cost of provision. Pharmaceutical companies are looking to exploit POC systems as part of a companion diagnostics strategy where drugs and tests are sold as combined "test and treat" packages.
The Group's POC Diagnostics strategy is focused on the commercialisation of the Atlas Genetics device as a first stage penetration of the market. Substantial progress has been made in the last year in the POC card development, in conjunction with Bespak who separately provide development and manufacturing services to Atlas, and with the development of the card reader and assay tests. In FY2016, Atlas announced that it had received approval to CE Mark its Chlamydia Trachomatis (CT) test to be launched on the Group's io® platform. By meeting the requirements of the IVD Directive (98/79/EC), the CT test is now cleared for sale within the European Union. In January 2017 Consort subscribed £3.1m alongside existing shareholders and a new investor, Wondfo Biotech, in a £28.4m Series D equity financing by Atlas. The funds will be used to finance the continued development of Atlas' combined Chlamydia and Gonorrhoea (CT/NG) assay and test cartridge, which is planned for regulatory approvals in the US and Europe around the end of 2017. The equity raise also provides funding to expand manufacturing capacity at Bespak. Following a successful outcome to this programme, Consort Medical intends to leverage the Group's development, manufacturing and regulatory know-how in order to grow its market share, possibly in conjunction with additional selective investments or acquisitions.