Lonza Group

What they make

5 inputs Lonza Group supplies

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Where they make it

5 facilities

Intelligence

What's known

Sourced claims about this company's role in supply chains — chokepoints, concentration, incidents, dual-use connections.

• Origin2023

  Lonza was founded in 1897 in Gampel, Valais, Switzerland — taking its name from the Lonza River whose hydroelectric power was used to run electrolytic nitrogen fixation plants for fertilizer production. Lonza used cheap Swiss hydropower to make carbide and acetylene at a time when cheap energy was the primary cost driver in chemical manufacturing. The chemical heritage expanded to vitamins, enzymes, and specialty chemicals over the 20th century. In 1999, Lonza acquired Microbiological Associates (a US biologic testing company) and began the pivot to pharmaceutical manufacturing. The transformative shift was acquiring Celltech Biologics in 2004 — UK bioreactor technology that became the foundation of Lonza's biologic CDMO business. By 2020, when Moderna had no manufacturing capacity for their mRNA vaccine, Lonza's Visp, Switzerland facility (built on the same site as their 1897 hydroelectric chemical factory) manufactured the mRNA drug substance. A hydroelectric nitrogen fixation company became the facility that manufactured the active ingredient of the first mRNA vaccine in human history.

  Lonza Group AG ↗

• Did you know2023

  Lonza is publicly known as a pharma CDMO and capsule manufacturer, but their Capsugel division makes the hard gelatin and HPMC capsule shells inside virtually every two-piece hard capsule supplement and medication in the world — approximately 35% of the global hard capsule market. The same Lonza Capsugel facility makes the capsule shell for a probiotic supplement from GNC AND the pharmaceutical hard capsule shell for a statin prescription drug AND the HPMC plant-based capsule for a vegan vitamin D3 supplement. Different products, different regulations, different customers — but the same injection-molded capsule manufacturing infrastructure. A Lonza capsule plant disruption would simultaneously affect over-the-counter vitamin supplies, prescription drug packaging, and clinical trial materials for novel drugs. Lonza's hard capsule business and their biologic CDMO business are linked only through Lonza's history — a Swiss energy-chemical-pharma conglomerate that ended up as the most critical CDMO for both hard capsules and bioreactor biologics.

  Lonza Group AG ↗

• Concentration2023

  Lonza Group's $5.5 billion acquisition of Capsugel in 2017 — combining Lonza (world's largest pharmaceutical contract development and manufacturing organization / CDMO) with Capsugel (world's largest empty hard-shell capsule manufacturer, formerly Pfizer's capsule division, then KKR PE portfolio) — created an unusual situation where the same company is simultaneously: (1) a major CDMO that develops and manufactures drug formulations for pharmaceutical clients (including those clients' capsule-filled products), and (2) the primary supplier of the empty capsule shells those drugs are put in. A pharmaceutical company that hires Lonza to fill and manufacture its drug capsule product is simultaneously buying the capsule shells from Lonza's Capsugel division. This creates a unique relationship where Lonza has visibility into both the drug formulation details (CDMO client) and the capsule supply chain (Capsugel client). Lonza's Capsugel concentration also means that a fire, force majeure, or regulatory shutdown at any major Capsugel manufacturing site would affect a significant fraction of global pharmaceutical finished dose production — capsule shells have essentially no inventory buffer (produced just-in-time for drug filling operations).

  Lonza Group AG ↗