Ardena Pamplona: an exemplary integration for unprecedented growth

Interview with Manuel Leal, Corporate Marketing Director at Ardena

Idifarma has been one of the greatest success stories of the pharmaceutical industry in Navarra in recent years. Supported from the outset by Sodena, the financial instrument of the Government of Navarra for the development of the region’s business fabric, the firm experienced rapid growth and accelerated internationalization that soon attracted the attention of international investors. Finally, at the end of 2021, the Belgian Ardena announced the acquisition of the Navarra-based company. The integration since then has been exemplary and Ardena Pamplona now plans to reintensify its growth and consolidate itself as one of the most relevant companies specialized in drug development in the country.

What was the origin of Idifarma and what were the first years like in an industry with such high barriers to entry as the biopharmaceutical industry?

Idifarma was created as the result of a successful experience at Cinfa. The founders of Idifarma experienced the complexity of the drug development process before leaving the company and creating Idifarma. The type of products on which the Cinfa project was based, generic drugs, required the development of a powerful range of products in the shortest possible time. This would not have been possible without outsourcing development work to specialized providers.

After this successful experience, they left the company and turned into entrepreneurs to launch Idifarma, based on their in-depth knowledge of the needs and the characteristics that a company specialized in outsourced drug development should have.

The first years were very difficult since the environment in which the proof of concept had to be tested was tough. Spanish pharmaceutical companies were not used to outsourcing development activities, the generic medicines landscape is very competitive, and there were financial limitations that made it difficult to count with the necessary infrastructure to develop an activity as intensive in capital as biopharmaceuticals. Little by little new clients were gained, gave visibility to the project and made it possible to successfully pass the proof of concept stage.

Thinking back to those beginnings, how do you assess Sodena's momentum in 2006? What other agents contributed to the consolidation and expansion of the business?

In order to ensure the long-term feasibility of the project, it was essential to have the infrastructure and equipment necessary to offer to the market development services that complied with the regulatory and quality requirements demanded in the industry and with sufficient capacity to achieve the critical mass of activity required in this sector.

In addition, it was decided to position the company in differentiated market segments, with greater technical demands and with greater growth potential in the future. A commitment was made to the so-called “high potency” drugs, which are used for oncology indications and other fast-growing therapeutical areas.

Likewise, it was understood that commercial development would require an internationalization process that would add complexity and demands to the project.

To carry out the project it was necessary to provide it with financial capacity. In this sense, the support of Sodena, materialized in the capital increase carried out in 2006, was decisive. Sodena continued supporting Idifarma as a shareholder until the acquisition of Ardena in 2021.

One aspect that should be highlighted is the participation of local financial entities (Caja Navarra and Caja Rural de Navarra) that also supported and accompanied us in this phase. These entities knew about us through their participation in Start Up Capital Navarra, another industrial development instrument in Navarra that helped us significantly in the first stage.

Finally, thanks to the collaboration of all shareholders, it was possible to have the current facilities and equipment, the human team and the organizational structure that qualified us to operate efficiently and competitively at a global level.

The decisions made in relation to the equipment, organization, knowledge and experience achieved, made us an attractive option for companies with a global profile and ambitious projects such as Ardena, which acquired Idifarma in 2021.

They develop and manufacture drugs for pharmaceutical industries located on five continents. What do you consider to be the success factors that enable you to operate successfully around the world?

The main factor is the human team. Counting with qualified personnel is essential in a sector where the technical and scientific knowledge is key.

In addition, our facilities and equipment have placed us in a great position to compete internationally. Our decision to invest in the necessary equipment to handle complex drugs, like highly potent substances or technologies to improve solubility, helped to communicate our differentiation to the market and reach a greater number of international customers.

Another very important factor was to have a quality system in accordance with all regulatory requirements, which allowed us to obtain the necessary health authorizations and certificates for drug development and manufacturing processes.

And of course, in a business where the reputation and trust factor is essential, our years of experience and continued good work is another of the success factors.

Idifarma has recorded continuous growth in revenue and employment in recent years, closed the year of the pandemic with a 70% increase in new contracts, and achieved a great partnership with one of the five major global pharmaceutical companies.

Idifarma had a steady growth over the years, but especially due to the specialization in some high value-added services and our greater presence and recognition in the market, we managed to significantly increase our project portfolio during the complicated years of the pandemic and sign several important contracts with many companies, including some large pharmaceutical companies.

This successful track record attracted the attention of foreign investors. But what, in particular, made the multinational Ardena acquire the company at the end of last year?

Ardena decided to invest in Idifarma for several reasons: Because of our production capacity and the design of our facility that allows us to further increase the volume of projects that we can develop in the future. For the great team of professionals that make up the company, an essential factor in its success. Due to the differentiating capacities of our plant: handling of toxic substances, spray drying technology, capacity to manufacture commercial batches of medicines, etc.

For our long history as a company in the sector, and for the good reputation obtained over 20 years. For our good record of regulatory authorizations and robust quality system. And for having a very clear business model similar to that of Ardena as a provider of specialized services.

With the acquisition, it was announced that the new owners would accelerate the firm's growth. What actions have been or will be taken in the coming years to achieve this?

In just one year since we became part of the Ardena group, we have benefited from synergies with the rest of the group’s sites in several key aspects: access to a greater number of clients and projects that make better use of our resources, exchange of good management practices, quality and technical execution of projects that contributes to the professional growth of work teams. And in addition, the first investments in new equipment have already been made that allow us to offer more services to customers in a complementary manner with other plants of the group.

Once our integration into the Ardena group is complete, the plan for the future is to continue growing our activity in a way that contributes to the common success of the group. This will go hand in hand with investments in equipment and the growth of the Ardena Pamplona human team.

How does the Ardena plant in Pamplona currently fit into the multinational's strategic plans?

Ardena Pamplona is part of the group’s pharma division, which also has a chemical and bioanalytical division.

We are the plant with the largest manufacturing capacity within our division, and we also have differentiating capabilities that very well complement the group’s service offering. For this reason, Ardena Pamplona will play an essential role in the ambitious growth plans of the Ardena pharmaceutical division.

Idifarma had already embarked on an evolution from generic drugs to new drugs, mainly in oncological therapies and orphan drugs (those aimed at rare diseases). What place do you think Ardena Pamplona can occupy in these areas? What future do you imagine for Ardena Pamplona?

Ardena is a company specializing in the provision of services for the development and manufacture of innovative medicines, and this made the integration of the Pamplona plant much easier, since we were already focusing our activity on this type of product instead of generic drugs.

In Pamplona, our facilities are specially designed for the handling of oncology drugs and for manufacturing in small volumes, which is a fundamental requirement to win orphan drug projects. This level of specialization is a very good match to Ardena’s business model, which seeks differential positioning in a market where there are a large number of competitors.

The future of Ardena Pamplona is seen with optimism and enthusiasm, forming part of an international group where our plant is valued and can perform to it its maximum level, and contributing as part of the group to help many new therapies reach clinical trials.

Inspired by Cinfa's success, dozens of technology-based companies have started their activities in the biopharmaceutical sector in Navarra in recent decades. What is your general assessment of the progress of the healthcare industry in Navarra? What other initiatives and projects would you highlight?

The early history of Idifarma is a clear proof of the important role that Laboratorios Cinfa plays in our region. However, the size and characteristics of the pharmaceutical sector cannot be forgotten, which make it very difficult for projects to be born and grow in this sector. For this reason, it is necessary to carefully identify the niches and areas in which projects can be deployed with a sufficient level of innovation and differentiation to achieve success.

In any case, in the pharmaceutical industry there is a huge variety of companies, roles and business models, from the generation of an idea or opportunity to the commercialization of medicines or health products, passing through the stages of early development, pharmaceutical development, clinical development, industrial processes, etc. This breadth generates opportunities in which projects like Idifarma are born and grow. In fact, the health sector in Navarra has projects that are progressing at different stages of development, relying on this idea of ​​searching for niches.

Initiatives and projects that I would highlight: 3P Biopharmaceuticals, Palobiofarma or Geiser Pharma, among many others.

One of the main keys to competitiveness in your industry is attracting talent. Is Navarre competitive in this area?

In our experience, this is the area in which we have faced the greatest difficulties. We have a very powerful academic base with the local universities, but it is necessary to increase and improve the business environment in the sector to generate the necessary experience and knowledge able to develop the talent the local pharmaceutical industry needs.

Navarra is not as competitive in talent acquisition as compared to the big pharmaceutical cities in Spain (Madrid and Barcelona). But that doesn’t mean we should accept it as a weakness. Strategies can and must be developed that allow us to overcome this; public and private investment in basic and applied research activities that attract experienced researchers and professionals, programs to attract professionals with the desired scientific specialization, strategies to bring back to Navarra the talent that left the region, development of technological infrastructures that facilitate the work of these people, improvement of the communication by train and plane, etc.

What aspects do you think need to be strengthened to remain a growth industry?

The biopharmaceutical sector will be one of the fastest growing sectors in the future. But not all segments of this market offer the same opportunities and expectations, so it is necessary to be selective, considering the limitations that Navarra has due to its size and financial capacity. I would suggest fostering initiatives that favor the development, recruitment, retention, and recovery of human capital, of talent, as the main factor of success; analysing of new technologies applicable to drug development, manufacturing and marketing processes (digitalization, big data, biomedicine, genetics, material engineering, process engineering, distribution and marketing, etc..); identifying opportunities and financial support for projects; promoting collaborative projects between the current organizations and entities in the sector; supporting research and innovation; promoting and supporting the internationalization of the sector; and improving the access to financial resources for projects in the early stages through public and private instruments. 

It is important to consider that projects in the pharmaceutical sector have significantly longer maturity periods than in other sectors, so the criteria applied in the field of venture capital and other financial instruments must be adapted to this sector since, otherwise, feasible projects might be lost.

In recent years, initiatives have been launched such as the Navarra health cluster, which Ardena Pamplona has promoted together with 7 other companies, or various programs to boost and support competitiveness. How do you assess the policies implemented in this area?

The health sector in Navarra covers a broad value chain, and initiatives such as the health cluster undoubtedly contribute to unifying the sector and ensuring its development and growth. Public-private collaboration, with the leadership of key companies in the sector, including Ardena, should result in the implementation of specific initiatives to improve the competitiveness in a sector that already employs more than 2,500 people at an industrial level and more than 1,000 people in research work, in addition to the 28,000 people who work in healthcare services, with a global turnover of almost 800 million euros.

We look forward to the upcoming initiatives and measures put in place in the Navarra Health Cluster, and Ardena Pamplona will be contributing with our experience and knowledge of the industry and offering the perspective of a multinational company with local presence in the region.

Navarra is one of the communities with the highest presence of multinationals in Spain. Moreover, the retention rate of these large companies is very high. As a reference point for one of the most important companies in the healthcare industry, what do you think is the reason for this?

Indeed, today Ardena is the only multinational in the pharmaceutical industry with a presence in Navarra after the acquisition and integration of Idifarma. I do not know the situation in other sectors like automotive or renewable energies where the presence of multinationals is more consolidated in Navarra, but from our perspective it is evident that having Ardena in this region is due exclusively to the good work carried out in Idifarma for many years and to the support that Sodena and other local financial institutions provided to the founding entrepreneurs.

Now that we are integrated into Ardena, we do want to emphasize the importance of what was previously mentioned in relation to the training, recruitment, and retention of talent as one of the most powerful levers to follow the Ardena success story with more investment from multinationals in the biopharmaceutical sector in Navarra.

The support for the creation and growth of new biopharmaceutical start-ups in Navarra will be another of key activity to attract international investment.

Manuel Leal
Corporate Marketing Director at Ardena