Lonza’s Vacaville biologics site to deliver its full potential in the early 2030s

Despite increasing customer interest and the signing of a fifth commercial contract, Lonza’s 956,000-square-foot site in Vacaville, California — one of the world’s largest biologics facilities dedicated to late-stage clinical and commercial mammalian manufacturing — will not deliver on its full potential until the next decade.

In its 2025 full-year financial results announced on Wednesday, Lonza said the Vacaville site — which includes 12,000L and 25,000L stainless steel bioreactors for a total capacity of 332,000L — is now fully integrated into its global manufacturing network.

While CEO Wolfgang Wienand described Vacaville as a “great fit” for Lonza coming at an important point in time, he told analysts in Wednesday’s earnings call that the company doesn’t expect the site to “fully deliver to its full potential” until the early 2030s.

Nonetheless, Wienand said the Vacaville campus — spanning 10 buildings and acquired in 2024 from Roche for $1.2 billion — has created for Lonza “in one go” the largest contract development and manufacturing organization (CDMO) mammalian network in the U.S.

“It’s a high-quality asset, as you can expect from Roche, and the investment that we started to do of up to CHF 500 million is into the flexibility of the site, so that we can even further increase operational efficiency,” Wienand added.

FDA audit, tech transfer

Lonza announced the first successful audit by the U.S. Food and Drug Administration (FDA) of the Vacaville site under its ownership, which was conducted in the fourth quarter of 2025 and was a “very strong outcome” with three “minor” FDA observations that were resolved almost immediately, according to Wienand. 

“There was no impact — nothing on the ongoing operations, and actually nothing of concern,” he emphasized regarding the FDA’s inspection.  

Weinand also noted the first successful technology transfer of a new commercial product to the site was executed “in a seamless way” with the Vacaville team meeting the “challenge of now operating within CDMO business model.”

From a revenue standpoint, Lonza has signed a fifth “significant” commercial contract for the site and other contracts are in late-stage negotiations. Vacaville's successful FDA audit and completion of its first tech transfer of a new commercial product bode well for the CDMO’s ability to sell capacity at the site, according to William Blair analysts.

In a Thursday note to investors, the analysts said they remain “bullish” on the potential for additional near-term contract signings by Lonza for the Vacaville site due to “robust” demand in the market for U.S. mammalian drug substance capacity.

“We expect recent policies aimed at incentivizing domestic U.S. manufacturing to be a tailwind for Lonza given its ample available capacity in the tight U.S. biologic manufacturing space,” the analysts wrote.

Michael de Marco, vice president of commercial development for Lonza’s Integrated Biologics Platform, told Pharma Manufacturing earlier this month that Vacaville’s large-scale mammalian capacity is well-suited for the current market environment.

“Vacaville is a super interesting site for many clients,” de Marco said. “We’re not really lacking any interest.”

Replacing revenue from Roche

Under the terms of the Vacaville acquisition, products previously manufactured at the site are being supplied by Lonza to Roche with minimum volume commitments over the medium term, which will ultimately phase out over time as the facility transitions to its own customers.      

“Customer interest is very high, remains high, as evidenced by now altogether five large commercial contracts for the site, which will — by the way — be able to already now kind of substitute the Roche volumes going out by 2028,” Wienand told analysts on Wednesday.

The five signed contracts alone “should be able to replace lost Roche revenue over the next few years, meaning Vacaville revenue will at a minimum remain stable at roughly CHF 600 million through 2028,” according to William Blair analysts, who contend “there is the potential for material upside to this outlook depending on the cadence of additional signings over the next six to 12 months.”

The analysts called out the outsized contribution from lower-margin work at the site for CDMO revenue in 2025 — CHF 600 million versus CHF 500 million estimate — which more than offset weaker-than-expected organic growth, while adding that flat Vacaville revenue will be around a one-point headwind to organic constant exchange rate (CER) sales growth this year.  

Overall, CFO Philippe Deecke said Lonza is “very pleased” with Vacaville financially and operationally as it introduces new products, while noting that the site will experience previously disclosed shutdowns for construction.

“The margin will improve over time,” Deecke said. “It’s not a linear path that will be getting better every year in the same increments. But I think we can confirm that by 2028 the site will be in line with the group at that point in time, and therefore neither dilutive nor accretive.”