Lifecore Biomedical has signed a 10-year commercial manufacturing and supply agreement with an undisclosed, longstanding customer to support the advancement of a novel ophthalmic therapeutic through clinical development and to market.
The Minnesota-based contract development and manufacturing organization (CDMO) also announced that it has inked a “multi-million-dollar statement of work detailing a range of fill and finish CDMO services that will further advance this program towards potential regulatory approval and commercialization.”
Under the new statement of work, Lifecore will be responsible for manufacturing a variety of batches for the drug candidate including multiple Process Performance Qualification (PPQ) batches, according to the announcement.
Lifecore CEO Paul Josephs in a statement said that the signing of the decade-long commercial supply agreement is in line with the company’s growth strategy which includes a “pipeline of late-stage customer projects that are nearing potential commercialization in the mid-term.”
Last month, William Blair analyst Max Smock initiated coverage of Lifecore with an “outperform” rating, writing in a May 21 report to investors that Alcon — the Swiss pharmaceutical and medical device company specializing in eye care products — represents a “solid foundation” for Lifecore’s achievable mid-term revenue guide.
Smock noted that two of Lifecore’s customers in fiscal 2024 combined accounted for approximately 58.4% of total revenue, with 39.4% of total revenue from Alcon which he pointed out is also one of the CDMO’s primary lenders.
“Lifecore remains dependent on a limited number of companies for a substantial majority of its revenue,” Smock wrote. “Through the third quarter of fiscal 2025, revenue from Alcon has grown 11.2% year-over-year, while revenue from Lifecore’s third-party customers has declined 3.6% year-over-year.”
While Smock expects Lifecore revenue attributable to Alcon to grow at a compound annual rate of 11.7% from fiscal 2025 through fiscal 2028, he contends that the company’s efforts to expand its customer base will “begin to pay dividends as its customers’ late-stage products reach commercialization and begin contributing more meaningfully to revenue” beyond fiscal 2028.
In September 2024, Lifecore completed installation and qualification of a high-speed, GMP-ready 5-head isolator filler, which is designed for fill/finish activities for vials, cartridges, and pre-filled syringes. The CDMO now has “significant available fill/finish capacity to attract new contract filling opportunities,” according to Smock.
Last week, Lifecore announced that it received the remaining $10 million in proceeds from the sale of its excess high-speed, multi-purpose 10-head isolator filler. Under the agreement announced in January, the CDMO initially received $7 million from the buyer with payments expected over 18 months. However, the buyer recently elected to complete the full payment ahead of schedule, paying the remaining balance as a lump sum.
“Combined with the recent installation of our high-speed 5-head filler, which supports up to $300 million in annual revenue generating capacity, this accelerated payment adds to the positive momentum we are building as we execute our long-term growth strategy,” Lifecore CEO Ryan Lake said in a statement.