Biopharma buy means more jobs likely in Longmont

LONGMONT — Employment in Longmont may be enhanced by the June 2 sale of Array BioPharma’s testing and contract manufacturing division to Accuratus Lab Services, which is being extremely aggressive in acquiring such resources.

“There were 33 employees there, but I think it’s closer to 40 now,” said Timothy Compton, vice president for business development at Avista Pharma Solutions, which is what Accuratus named the former manufacturing arm of Array (Nasdaq: ARRY). “We are (hiring) and will continue to hire there, and I already have board approval for further capital expenditures.”

On July 23, Accuratus’ holding company – Ampersand Capital Partners, a health-care-focused private equity firm based in Wellesley, Mass. – orchestrated another buyout, this time allowing Avista Pharma to buy the contract manufacturing, development and animal-health services business of Scynexis, Inc, of Durham, N.C.

“This is our second acquisition this year as we pursue an aggressive growth strategy to build a dominant company in the contract-services sector” said Patrick Walsh, recently named chief executive at Avista/Accuratus, in a prepared statement. “We have a proven leadership team already in place, and you can expect to see facility investments at several of our sites as we expand capabilities to meet client demand.”

The state-of-the-art, 50,000-square-foot Longmont laboratory Avista acquired from Array has a strong track record in the scientific controls necessary for manufacturing drugs not only for its parent company but also for other biopharmaceutical companies that had discovered likely candidates. With the exception of its animal-health work, that was also the scenario with Scynexis, Compton said.

The main thing both companies had in common is that they both were looking to fund their own late-stage trials, an expensive proposition for smaller biopharma companies.

“It’s quite costly to develop that late-stage,” Compton said. “There’s a lot of companies that only take it to a certain level, then they partner and license (the molecules they have developed.)

But Compton said some companies are so confident of the end success of a particular molecule that they are willing to essentially bet the farm on its development. That could be the case with Array’s compound that treats colon and rectal cancer and Scynexis’ anti-fungal treatment.

That’s the big-time payoff in biopharma, but Compton said there is plenty of profit to be had in enabling such research, as well. Essentially, Avista now will be a player in the middle of the market – manufacturing drugs shortly after discovery to go through trials.

“We help clients early in the discovery stage, taking them through proof of concept clinical trials, and we help them develop and manufacture the active ingredient,” Compton said. After that, Avista also will help drug companies develop the delivery system for late-stage trials, such as putting the drug in a tablet.

Compton said the acquisition of both companies was part of a larger plan by the holding company to move aggressively into this market.

“I came on in board on June 1, I was hired to manage this development, integrating sales and marketing for both companies,” he said. “I was kind of the man in wait until June 2.”

Similarly, Walsh was named CEO on June 29, as the acquisition of Scynexis still was pending. Walsh has more than 30 years of experience in contract development and manufacturing organizations, and both he and Compton are expected to split time between Longmont and Durham.

Tricia Haugeto, director of corporate communications and public relations for Array, said some of the Longmont workers who were not part of the core Avista business were relocated to Array’s 150,000-square-foot campus in Boulder. Array now has roughly 150 employees, mostly in Boulder, which houses the corporate offices as well as chemistry, biology, drug-discovery, clinical and pre-clinical operations.

Avista will continue to manufacture drugs for Array in support of its drug discovery and development programs on a contract basis. The sale of the division, however, gives Array some cost savings in periods of reduced manufacturing needs, Haugeto said.

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