
Endpoints webinar: Inside the “One Lonza” strategy: Re-engineering the future of CDMO
In Endpoints News’ latest fireside chat, CEO of Lonza, Wolfgang Wienand, sat down with Endpoints’ Arsalan Arif, to share key insights into the company’s “One Lonza” restructuring strategy. The new company structure, which will be operational by April 2025, is designed to position Lonza as a pure-play CDMO while streamlining operations and enhancing customer value. Wienand explained how “One Lonza” aims to unify the company under three Business Platforms to better align with industry trends and optimize services for biopharma clients.
One key highlight of the discussion was the acquisition of Roche-Genentech’s Vacaville site, which was a strategic move aimed at expanding mammalian cell manufacturing capacity in response to increasing biologics production demand. After the deal closed in October 2024, Wienand shared that the transition of the Vacaville site was seamless, technical integration is now complete and new customer contracts are already in place. During the conversation, Wienand reflected on how his expertise in chemistry informs his leadership strategy, fostering trust with both clients and employees. He emphasized Lonza’s commitment to innovation and investment in multiple drug modalities, with plans to pursue both organic growth and M&A opportunities to sustain its leadership in the evolving CDMO landscape.
Key Takeaways
- One Lonza strategy launches in April 2025, restructuring into three Business Platforms.
- The 2024 acquisition of Roche-Genentech’s Vacaville site expands Lonza’s biologics capacity, with full integration and new customer contracts in place.
- Lonza’s future growth will be driven by organic growth and M&A opportunities
Fireside chat: Q&A
- Arsalan Arif, CEO and Co-Founder, Endpoints News
- Wolfgang Wienand, CEO, Lonza
This conversation has been edited for length and clarity.
Arsalan Arif: Hi everybody, I’m Arsalan Arif, the publisher and founder of Endpoints News, and thank you for joining us today. It’s my pleasure to welcome Wolfgang Wienand, the CEO of Lonza, for a fireside chat. And let’s just get right into it. You joined Lonza in July last year, and in December you unveiled your new One Lonza strategy. Could you just tell us a little bit more about what that means for the Endpoints audience, please?
Wolfgang Wienand: Yeah, happy to do so, Arsalan, and thanks for having me in the first place. No, indeed. I joined Lonza, a great team actually on July 1st last year. It hasn’t been a boring time since then, I have to say, but in a very good way. We worked hard, together with the executive leadership team and the broader senior leadership team, to actually get clarity about our vision as a company, where do we want to take Lonza, then actually what the right strategy is to get us where we want to get as a company. And then asking ourselves what is the most appropriate operating model which helps to fulfill the strategy, and then talk about execution. And all that we went through and then shared in the middle of December, first internally, and then also externally to the financial markets. Maybe very quickly in a fast-forward fashion, taking us through that vision, being Lonza is the pioneer and the market leader in the CDMO industry, setting the pace with cutting-edge science, smart technology, and lean manufacturing.
It’s a pretty rich statement, and I probably shouldn’t take you through all of it, but essentially two things are probably clear, and are clearly defined also by stating this as our vision. First of all, we want to transform ourselves into a pure play CDMO. So when I entered the organization and took a look at the businesses, Lonza was organized into four divisions. But in reality, if you actually take a closer look, you essentially see two different business models. One being a product business model, our capsules and health ingredients business CHI, which actually is a great business, market leading, and also superior in terms of technology and margin, but a product business, not a CDMO business. And then three divisions, which are all in the end adhering to the same business model, which is the CDMO business model. And we thought when taking a closer look, while being a great business CHI, that this is not fully benefiting from what actually makes us special at Lonza, which we defined in another working group, as a Lonza engine.
So really the core competencies, the unique set of capabilities that we have as Lonza, which actually makes us special in that space, and makes us hopeful and confident that we will be able to deliver outstanding value to our customers, to our shareholders, and to our people, our employees. So that was the first step in terms of getting clarity, where we want to play, where we are not the best, which is CHI. And we took the decision to actually exit that business at the appropriate point in time, in the best interest of our shareholders.
Then it was about the CDMO business model, with the ambition to actually stay the market leader and further stay ahead of the wave, and then asking ourselves actually, how to further improve and evolve as a market leading CDMO. And that led to our decision to reshape our operating model and go for three business platforms in a somewhat different adjusted composition with a unified organizational structure across all three different business platforms, which is now, starting in April 2025, going to be a functional organization per business platform, and also stronger group functions in order to provide systemic solutions, provide support to all the businesses, and making sure that we run and operate our assets in a very consistent, harmonized way, to eventually of course support our efficiency targets. But first and foremost create the best customer experience when working together with Lonza, as possible.
So that actually has been the thought process that we went through. The team right now is really working hard to prepare the cut over from the current operating model with four divisions, into the new model, starting April. But actually I’m extremely hopeful and even impressed by how much work the teams can actually absorb while still being confident and looking forward to the change which is ahead of us. So we will have that fresh start for good, starting in April this year.
Arsalan Arif: So, wonderful. That’s the implementation update. Basically you unveiled the strategy about three months ago, and we’re looking to April right now for that.
Wolfgang Wienand: Right.
Arsalan Arif: So under this new structure, integrated biologics is going to be the largest business platform. Given that, are there any major industry trends that you are observing and responding to, particularly in the biologic sector?
Wolfgang Wienand: Yeah, indeed. And let’s say our view on the market, not only as it is today, but also how we believe that actually the most successful, most competitive offerings for our clients will evolve over the coming years. We actually integrated this thinking into how we designed our organization. And maybe as a brief segue, the ideal setup in our view for the CDMO business of Lonza will actually be one business, one business unit. Because it is the same business model, essentially just building on different technologies. And actually that is something which makes Lonza special, we have them all, right? We are present and leading or even the leader in any relevant pharmaceutical modality. But in the end, the company is too large to actually run it as one business unit, so to say. So we had to break it down in a way that actually those technologies, those activities which are most frequently asked for in a combined fashion, are as close to each other as possible.
And indeed what we will call integrated biologics, starting April, is the combination of this large machine of mammalian [cell] manufacturing, of monoclonal antibodies, and other proteins, together with our aseptic fill-finish activities, which is where we see most inroads, highest interests of our customers for the integrated offering of drug substance manufacturing and then taking that drug substance further down the value chain and delivering aseptically filled-finished drug products. So that’s a reflection on that, and that is how we foresee the market to evolve over the next years. Because in the end, besides many other things, what our offering, our value contribution to our clients, of course does, is we take over complexity, and we manage that complexity internally. And the more of the value chain we can actually take over, the easier we make the lives of our clients, and the more value we create for them and also for Lonza of course as well.
However, as an addition to that, while the aseptic fill-finish activities, drug product activities are part of the integrated biologics business platform, they of course are also available as individual services just for the drug product, but of course also, and we have a number of great businesses in that area, also for other modalities. So for example, manufacturing the drug product for ADCs. ADCs being part of a different business platform, advanced synthesis. So that’s just the expectation that in the end, we as Lonza need to be able to operate as one Lonza, which is also the title, the headline of our new corporate strategy, the “One Lonza strategy”, if that makes sense, Arsalan.
Arif: Yep. Very good. I want to ask you about a site acquisition that you made back in October, the Vacaville site in California. So I understand it’s joining the integrated biologics business platform. So this site in Vacaville, how does it help to address these trends that you just talked about for the benefit of your business and customers? And furthermore, can you tell me more about the readiness of that site? Is it already integrated into the Lonza network? Is it already up and running for you?
Wienand: Yeah, thanks. Great question, Arsalan, happy to take you through that. First of all, and I believe and actually we are convinced that we will make this significant acquisition of significant mammalian [cell] manufacturing capacity a great success for our partners in the pharmaceutical industry, and as such also for ourselves and the Vacaville team, it is a great site. I joined the team on day one when we actually closed the deal, and officially had the cut over from Genentech Roche to then Lonza. While this being a great celebration with a lot of energy, which in itself is a good sign in terms of the readiness of the Vacaville team to really join the Lonza team and become an integral part of our biologics manufacturing network, it also was based on successful work, because at that point in time it was clear that the many weeks of preparation actually had paid off.
And the team in Vacaville, together with a number of Lonza colleagues from other manufacturing sites, made it work perfectly. So no hiccups, continued manufacturing, our customers are happy, which expect delivery, and also the people are happy in terms of switching from one system to the other. So the answer to your question – how far are we advanced in terms of integration? It is a continuous effort. Technically integration is done, so all systems essentially switched over from Roche-Genentech to Lonza. We have a number of, let’s say, Lonza people from other sites now being permanently members of the Vacaville team, we actually could take over, which I thought is a great sign of appreciation and also support of our thinking. Essentially 100% of the Vacaville colleagues, they all decided to join us on our journey. So it is really now technically fully integrated, and it is available to our clients.
And I actually toured the facility also once more in January together with a large strategic partner of Lonza, the responsible person for global operations at that big pharma company, and can tell, from our own experience, how well received both the assets and also the Vacaville team are by our clients. And we have been able to already, a few weeks after closing the deal, to sign two commercial contracts already. And there are numerous other visits and negotiations for additional product intakes going on as we speak. So it’s actually great to see how well this project is going on so far. And we are looking forward to actually introducing and then commercially manufacturing the first products, further down the road, making it available as a high quality, high-end commercial capacity, in a short market for our clients.
Arif: So just to clarify that, so you’re expecting the Vacaville team to be a fast-paced, multi-product, multi-customer CDMO, and what you’re telling us it’s well on its way to being that and ready for customer projects?
Wienand: Oh, the answer is yes, and I’ll be happy to maybe shed a bit of further light on my perspective, on that.
Wienand: First of all, we all know that we all share that privilege of working in the biopharmaceutical industry, one way or the other, right? It’s just a great place for many reasons as we know. And while what we are doing physically on our sites, looking at the assets, the labs, and the work that we do, it actually pretty much looks the same as what the teams at our customers and their facilities, if they have any, are doing there. But in reality, the business model of course is a completely different one. I mean, operating the captive manufacturing side as part of a global manufacturing network of a big pharma company has very different key success factors as compared to operating the same site, the same asset, the same technology within the CDMO being customer facing to 50, 100 customers, being continuously audited, inspected by those customers as well. Having to stand up to sell your capacity, your capabilities, your teams, towards a number of different, also very proud customers, is a different way of working.
So we have been very mindful about this change, looking the same, not being the same, and have explained that and taken Vacaville through that thought process, what it means. And I actually did that partially myself. And what I can tell is that the Vacaville team – and you might expect that from an American team anyway – super entrepreneurial, looking forward to the challenge, and they want and will make it work, with the support of the Lonza network for sure as well. But actually, first of all, it’s a great question because that as well can also get derailed, but I think we have a very good chance of success and have first proof points that this team is actually up to the challenge within Lonza, with the support of the Lonza team, of course.
Arif: I want to ask you, because you’re the new CEO at Lonza, and just the process that you were talking about with getting that site and changing it over, and integrating with the Lonza network, I want to ask about your background, because I find it a bit unusual, your scientific background in the CDMO space. How does your chemistry expertise influence your decision-making in areas like how you’re integrating this Vacaville site or even in R&D investment at Lonza where your overall leadership style…just really how does that scientific background inform your leadership style right now?
Wienand: Yeah, indeed, and maybe to add to that later on, I also had the pleasure to learn a bit about finance as well, which is exciting in its own way too. But that aside, to your question, and that’s now speaking for myself, I’m not saying that it has to be like that at the top of every CDMO, but what I found being beneficial also for my leadership. In the end what we are doing is a high-tech thing or it’s a high-tech industry, and making decisions. It’s probably hard to just base it on generic insights because it is always related to technical risk, implementation risk, scientific risk, and having an understanding of how those risks might play out over time. At least having an idea about assessing them, in their materiality or not, probably is generally helpful in our business. Another observation is that, I’m also at our clients, I’m talking a lot to our partners in the pharmaceutical industry, and these are most cases also technical people. And they want to know that their precious innovations, that they actually entrust us with, hand over to Lonza, that they’re actually appreciated, well understood, and that they are in good hands.
And so I guess executive leaders and CEOs being also able to speak to that perspective of a product, of a relationship, and having an appreciation for the complexity of the science behind, probably is helpful. The last aspect might be about leadership style. At Lonza we are one Lonza team, and we need everyone, right?. And a key trait, I would even say key prerequisite to efficiently lead and effectively lead a large organization, is credibility. And if people understand that also I as A CEO have an appreciation, understanding, maybe even a good idea for a solution of a technical problem or how to run an asset, that just makes the exchange easier, creates trust. And trust in the end is helping efficiency because you rely on each other and you don’t question everything. And so I found it always useful, and I actually like to do it. To walk the shop floor, talk to the people, understand why they’re doing it this way, maybe have an idea how to do it. And I think it just improves our way of interaction and I guess also my own decision making, if that makes sense.
Arif: Yeah, absolutely. That’s wonderful insight into your leadership style. I appreciate that. Anything else that you wanted to cover that we haven’t yet on the One Lonza strategy?
Wienand: Yeah, maybe a slight change as compared to the past. First of all, what company did I find on the 1st of July? And having worked in the CDMO industry for almost two decades, of course I had a perspective on Lonza, Lonza being the market leader in the space. I knew a number of Lonza people. But what became very clear to me – this actually is not only from the outside but also from the inside – if I look at the potential of what we do, at the potential of our people, Lonza actually is a place of, I believe, unique opportunity for our clients, but also for ourselves. However, and as we discussed at the beginning, we as an executive leadership team and myself as a CEO, we have certain ideas. What else we can do to really fully exploit the potential of our company.
And we kind of phrased it around four key terms, which in the end all are supposed to serve what we from now on going forward, we’ll call the “Lonza engine.” So the thing that makes us special and really is a set of unique competitive advantages, compared to the competitive landscape. The four things being, first of all, focus. That was about taking the decision to become a pure play CDMO, and properly exiting the CHI business. It was about reshaping the operating model, serving our strategy, serving our vision. It was about elevating [the business]. So this is about construction and operation excellence, further improving on that pathway. And lastly, about how to expand.
So historically Lonza has been able to execute successful M&A, Vacaville being a great example, I believe. But overall, if there have been choices, I guess the slight preference has always been to build ourselves. And going forward, based on my own experience in the industry, and also what we foresee as future trends, we will take an impartial view on potential growth opportunities, be it through organic investments where we think this is the most value adding trajectory, but also making use of M&A opportunities in the market, in different areas, across modalities, there we will be agnostic and we will continue to be a multi-modality CDMO, and we will continue to invest into all modalities, and very important, also future modalities as Lonza always did.
The teams in the last 20, 30, maybe even 40 years, always managed to capture the next wave, and support the pharmaceutical industry with the latest manufacturing technologies for new modalities. And that is something that Lonza will – also going forward – contribute to the pharmaceutical universe, of course for the benefit of our clients, but of course for the benefit of Lonza as well, so that we as a market leading CDMO will stay ahead of the wave also in the future.
Arif: That’s an interesting point that you made, because you had said something about Lonza in the past, maybe had a proclivity to want to build or make the thing itself. I find that in business sometimes that build or buy question can be one of the most important things a CEO can actually influence, particularly in a company like Lonza, incredibly important, with a rich history and scientific history. There is a bit of pride that comes from building the thing within. I find that even with my own team sometimes, sometimes we’re looking to build a wheel again. It may be a beautiful wheel, but sometimes someone else has already built it.
Wienand: Yeah, which is true. And I think the best answer to that is to actually in a curious, and again, impartial way, look at opportunities, leaving that all aside and trying to form your opinion on how to best serve a certain business case, a certain scientific problem, a certain, commercial problem. And indeed, so it is probably a slight shift, but one that I can say so far already one, which actually the team is curious to explore. And we also added a Chief Strategy Officer to our extended executive leadership team who’s building and training them in a way. And I’m actually confident that we will actually continue to do both. Exploit organic growth opportunities as we did in the past, but as an add-on, also exploit opportunities of inorganic growth. And I think a very good example, for one kind of a deal that Lonza might also do in the future, besides other deal structures and other targets related to that. But it is true in the end, the company is an organism and you’ll kind of start to shape it so that it actually best serves its purpose and the needs of the clients.
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