A New Leading European Company

Early this year, the French multinational healthcare company Sanofi announced the establishment of EUROAPI, a future leading European company dedicated to the development, production and marketing of active pharmaceutical ingredients (API). The standalone company will combine Sanofi’s API commercial and development activities with six of its European production sites, one of which is in Újpest, a northern district of the Hungarian capital.

Explaining the significance of active pharmaceutical ingredients, the General Director of EUROAPI Hungary, Dr. Zsuzsanna Diószegi tells Diplomacy&Trade that all drugs are made up of two core components, the API, which is the effective molecule responsible for the therapeutic effect used in the composition of any drug, and the excipient, the substances that help deliver the medication.

API to medicine
She points out that “API and raw material are often confused due to the similar usage of the two terms. What is the difference? Raw material refers to chemical compounds that are used as a base to make an API. We purchase the raw materials from raw material or chemical product manufacturers. When using the raw materials, we produce APIs in our plants. The API is not made by only one reaction from the raw materials but rather it becomes an API via several chemical compounds. After this long manufacturing process, it is purified until it reaches a very high degree of purity and finally becomes an API.
We manufacture APIs and drug manufacturers make medicines from APIs. Drug manufacturers make medicines by mixing APIs and pharmaceutical excipients. This is how an API becomes a medicine. The quality of APIs has a significant effect on the efficacy (producing the result desired) and the safety of medications. If an API is not ultrapure, a medicine cannot meet the strict quality criteria, so APIs are subject to stringent regulations and oversight by the country they are shipped to.”

Better supply chain resilience
The new EUROAPI company has 3,200 employees, operates six important industrial sites, has about 200 APIs in its portfolio selling in more than 80 countries worldwide. “We are the biggest player on the small molecule production market, so we can undoubtedly declare that this transformation is a strategically important move for the entire pharmaceutical industry. EUROAPI'S sites are in Europe and are staffed by skilled employees who must comply with the highest quality, labor and environmental standards. EUROAPI offers an alternative supply solution based in Europe to ensure a better supply chain resilience. By diversifying resources and careful planning, European manufacturers will be able to procure European-quality active pharmaceutical ingredients that have been produced in compliance with the strict European regulations, via shortened transport routes, while the innovations tailored to their needs will ensure competitive prices.” she adds.

Less dependence on Asia
EUROAPI will represent the API state-of-the-art industrial capabilities and technologies. As to what the benefits of working on a European level, with European professionals, creating and utilizing a continental supply chain, etc. will be, Dr. Zsuzsanna Diószegi stresses that in a context of increasing medicine shortages that are critical for patient care, it is key to ensure autonomy in API supply. “Industry and governments need to collaborate to develop a joint approach to support manufacturing and supply excellence, including, for example, double sourcing of essential medicines and regional API sourcing.” The new company would bring a European balance in an industry very dependent on Asia, knowing that 60% of the world’s API production (by volume) comes from China and India. EUROAPI is less dependent on Asia given its highly vertically integrated structure, which enables it to only source highly commoditized raw materials and solvents on the open market. Since the COVID-19 situation, we can see growing trend towards ‘dual sourcing’ in Western countries. Building on a strong industrial legacy built over decades and broad expertise and experience, EUROAPI would help secure a greater stability in supplying quality API for the benefit of millions of patients worldwide.”

Pursuing innovation
At EUROAPI the Újpest site plays a special role in the new stand-alone company. It’s wide product range and world-leading prostaglandin product portfolio make this site an essential asset. On November 1 this year, EUROAPI was joined by EUROAPI Hungary Ltd. whose General Director points out that Budapest is one of the largest sites of the new company, both in terms of staff numbers and volumes, while it also brings a successful development team. Therefore, it is only logical that it will also serve as one of EUROAPI's development centers. “We are empowered to invest in new technologies and pursue innovation. The EUROAPI Group itself and its Hungarian legal entity also intends to be the engine of partnerships in the industry. We are not just differentiating ourselves from other manufacturers by meeting higher safety standards, we can also use the great science and engineering capabilities of the universities, start-ups in Europe. By bringing in the scientific, innovative ecosystem, we are strengthening the science and increasing the quality and competitiveness of our processes. All our investments in Újpest will focus on new products and process developments that are featuring industry 4.0 and green tech, green chemistry approaches and solutions. The spill-over effect of such cooperation is also significant: the Hungarian economy is strengthening, new jobs are being created, the standard of education is increasing, and Hungary's export performance is growing.”
The Újpest site also hosts the Budapest IT hub of the Group. It ensures the services for each industrial site and headquarters of EUROAPI and commercial affiliate.

World’s #1 in prostaglandin generics
EUROAPI Hungary is headquartered in Újpest at a former Chinoin site that has a history of 111 years. The company is to build on this tradition and expertise to concentrate huge intellectual capital, with innovative production technology solutions and continuous development to meet the challenges of the future. “One of our most awaited projects is focusing on prostaglandins. The Újpest site is the largest prostaglandin API production facility in the world, and EUROAPI is the world’s leading supplier of prostaglandins for large-scale commercial pharmaceutical production,” the General Director says.
Prostaglandins are naturally occurring molecules in animal and human tissues or organs. They are unique because they can induce a variety of effects and processes within the system with extremely low dosages. Synthetic prostaglandins can be clinically used in a wide array of applications, from induction of childbirth to the treatment of glaucoma or hypertension – but they are also used extensively in men's health and veterinary applications. “Boasting nearly 200 different products, our manufacturing has led Hungary to become the leading producer in the world. Due to the ever-increasing global demand for prostaglandins, EUROAPI Hungary has increased its activity by more than 60% in the last five years,” she adds.
In an effort to maintain Hungary's, and by extension the European Union's, unique European position in the integrated chain of prostaglandin APIs, as well as provide a secure and autonomous prostaglandin supply chain, the company is constantly improving its activities. “These activities are fueled by our quest to look for new, green, and sustainable production methods in alignment with our common, regional directives, such as the ‘European Green Deal’ and ‘Fit for 55’ initiatives.”

Bringing life-changing medicines to the market faster
Another, but equally important, aim of EUROAPI is to strengthen the trust of its partners. Regarding the means to do that, Dr. Zsuzsanna Diószegi highlights that in the field of foodstuffs, there is already a noticeable tendency of purchasing foods from reliable or local sources. “I originally studied as a pharmacist and not a chemist, so I am fully aware that the source of the active ingredient used in a medicinal product is not inconsequential. If you think about it, this raises the greatest issue of trust: what medicine should we take or give to our children?”
She stresses that they want to act hand in hand with their partners to improve their businesses and products, placing active solutions at the heart of their success. “EUROAPI is the global leader in small molecule APIs, and our robust innovation and R&D capabilities enable us to accelerate our contract development manufacturing organization (CDMO) activities in complex molecule segments. When it comes to the complexities of drug development and manufacturing, pharmaceutical companies are relying on CDMOs more and more, because we can save clients valuable time, helping them to quickly bring life-changing medicines to the market. Whether it is navigating the highly regulated drug development framework required by the authorities or scaling production to meet deadlines and demand, having a CDMO partner can be a great resource with plenty of benefits for pharmaceutical companies to focus their efforts and resources on initiatives that move their company forward.” She believes that it is no question that trust can be a delicate issue in relations between a CDMO and a customer. The customer’s biggest concern when working with a contract manufacturer is to minimize the risk for their product. They need a CDMO partner they can trust, with an experienced team, strong quality systems and a proven track record of successfully supplying their customers on time and on budget.

Reducing environmental footprint
In the pharmaceutical industry, environmental protection is of utmost importance. “Between 2018 and 2020, we conducted more than a hundred customer CSR and Health and Safety audits with 100% success. Reducing EUROAPI’s environmental footprint and taking action on climate change are part of EUROAPI’s roadmap as a responsible industrial company.”
As to what measures they have in place in Újpest to ensure this as well as sustainability, the General Director explains that they always want to be one step ahead in the race for innovation and leading the way in developing active pharmaceutical ingredients across Europe and beyond, with the highest quality standards in a sustainable way.