Merck says it has overcome production shortages in vaccine materials

* CEO cites shortages in filtration products

* Also had to clear backlog in bioreactors, diagnostic chems

* Life Science unit has invested more than 425 mln eur since 2017

Germany’s Merck KGaA , one of the world’s largest suppliers of materials and equipment for the production of biotech drugs, is boosting output capacity to keep up with a surge in demand from companies fighting the COVID-19 pandemic.

Diversified Merck makes chemicals for the electronic industry as well as speciality drugs, while its Life Science division supplies lab equipment and plays a role in more than 50 global projects aiming to develop a vaccine against COVID-19.

“We are a very important partner for diagnostic firms, vaccine companies and companies that want to manufacture antibodies,” Merck Chief Executive Stefan Oschmann told Reuters, referring to a new class of potential treatments for people infected with the new coronavirus.

Merck’s Life Science division, as well as its competitors, have been expanding to meet the increase in demand and to support the global effort to mass-produce vaccines, he said.

Competitors of the business include Thermo Fisher and Sartorius. The COVID-19 pandemic, which has claimed more than 900,000 lives globally, has triggered a race to develop an effective vaccine with 35 projects already testing their candidates on humans.

Areas hampered by temporary shortages included filtration products, where Merck has rushed to clear order backlogs, said Oschmann.

Single-use plastic bioreactors, which are replacing traditional metal tanks for the fermentation of therapeutic proteins, were also temporarily out of stock in some places, requiring teams “to work day and night, so far quite successfully”, he added.

The company has also overcome shortages in its supply of speciality chemicals that help extract viral material from samples for the diagnostics industry.

The Life Science unit has invested more than 425 million euros ($503 million) to meet growing market demand since 2017, but the CEO declined to give detailed figures for this year.

The company said earlier on Wednesday at its capital markets day that it now expected 6-9% revenue growth at Life Science over the next five years, versus 5-8% previously.

https://www.marketscreener.com/quote/stock/MERCK-KGAA-436395/news/Merck-says-it-has-overcome-production-shortages-in-vaccine-materials-31307846/