I didn't have to
Nick Green says he loves quickly building businesses.
An indicator of the breakneck speed of the chief executive of Avid Bioservices Inc. (Nasdaq: CDMO) came earlier this month when it announced completion of Phase 1 of its $75 million “world-class” manufacturing facility in Costa Mesa, only eight months after announcing its plans.
The 53,000-square-foot viral vector facility was designed and built by Kansas City, Mo.-based CRB, a construction firm that specializes in the life sciences industry. The second phase of the facility’s development is expected to become operational in mid-calendar year 2023.
“Considering the challenges of the current supply chain environment, it has been nothing short of remarkable for Avid and CRB to be opening the doors of Avid’s new viral vector process development labs here in June,” said Mike Alston Jr., director of project engineering for Avid Bioservices.
The site, at 3030 Airway Ave., is near John Wayne Airport, and about a 15-minute drive from Avid’s multi-building headquarters base in Tustin.
The Costa Mesa expansion came after Avid announced plans to invest nearly another $70 million to upgrade facilities at its Tustin base in early 2021.
Booming Sales
In the past 30 years, Green has headed 31 global pharmaceutical facilities in nine countries on four continents.
At every company he’s worked at, he’s grown compounded annual growth rate by at least 20%.
“I love growing businesses,” he told the Business Journal last October. “It’s what I’ve done most of my life.”
Green’s been aided by paradigm shift in the industry. While drug manufacturing may be 5% to 10% cheaper in places like China, the pandemic has caused drug company executives to realize the fragility of their supply chains. They now want to keep more of their manufacturing within North America.
In 2021, Green’s first full year as CEO, Avid almost doubled sales in 2021 to $95.9 million. Analysts are expecting Avid sales to climb 22% this year to $117.3 million and another 25% in 2023 to $146.5 million.
Green said Avid has the potential to generate $350 million in annual sales.
Shares have more than doubled since Green became CEO. The Tustin-based company now sports a $940 million market cap.
New Industry
Avid is known as a contract manufacturer of biologics for pharmaceutical companies in more than 90 countries.
The Costa Mesa facility was built so Avid can make drugs for cell and gene therapy, a market that’s expected to grow more than 18% annually through 2028.
“Avid’s entry into the cell and gene therapy sector is a critical component of the company’s growth strategy over both the short- and long-term,” Green said in a statement. “We believe that we are uniquely positioned to leverage our deep expertise in the manufacturing of traditional biologics to address the growing demand for high quality manufacturing of cell and gene therapies.
“We now look forward to engaging in a meaningful way with potential viral vector clients and offering this latest tangible evidence of the quality of Avid’s facilities and the capabilities of our team.”
The company is continuing to expand its development capacity for its mammalian cell business by spending $6 million on larger state-of-the-art laboratories that could support an additional $20 million in annual process development revenue, doubling the company’s current process development capacity.
Mammalian cell culture is the process of growing cells obtained from mammals in vitro, outside their original tissue.
Completion is anticipated by the end of calendar 2022.
“With several expansion projects underway across various facilities and business segments, we feel that we are well positioned to take advantage of the increasing demand for high-quality CDMO services and continue to rapidly grow our revenue,” Green said.
