Swiss contract development and manufacturing organization (CDMO) Bachem is rolling out a series of facility expansions across its network in response to the rapidly growing global demand for peptides and oligonucleotides.

At its headquarters in Bubendorf, Switzerland, Bachem built a new large-scale production facility known as Building K — which was inaugurated in April 2026 — as part of its investment program to expand manufacturing capacity. Commercial GMP products are currently being manufactured at Building K, which is the CDMO’s response to the rapidly growing global demand for peptide and oligonucleotide active ingredients, according to the company. The facility’s successful ramp-up of production is a key part of Bachem’s long-term growth strategy.

Bachem, which specializes in the development and manufacture of peptides and oligonucleotides as active pharmaceutical ingredients (APIs), expects sales growth between 35% and 40% in local currencies in 2026, according to first-half financial results reported on Thursday. For now, ramp-up costs for Building K affected the operating results in the first six months of this year.

“As expected, the ramp-up costs for Building K has had an impact on our profitability,” Bachem CEO Anne-Kathrin Stoller said in a statement. “However, with the ongoing ramp up of this facility — our largest to date for high-volume production — and further operational improvements, we expect significantly positive trend in the second half.”

Stoller told analysts in Thursday’s earnings call that Bachem is pleased with how Building K’s ramp-up is proceeding, with sales expected in the second half of 2026 to primarily contribute to the commercial API category.

“We are also continuing to work on the construction of the phase II [for Building K] while we continue production of the phase I,” Stoller added. “The contribution from Building K comes from the phase I, from the first line. We are still finalizing construction for the phase II, that will then start to contribute next year [to sales].”

At Bachem’s Bubendorf site, its largest GMP hub for peptide and oligonucleotide production, Stoller said the company is also working on several capital expenditure (CapEx) projects to reduce specific bottlenecks, while the CDMO is continuing its operational initiative to unlock further capacity as it looks to optimize the utilization of existing buildings and facilities.

Investing in global manufacturing network

Bachem is implementing a CapEx program to expand capacity across its global network of manufacturing sites, including Bubendorf, Sisslerfeld (Switzerland), Vionnaz (Switzerland), Vista (California), Torrance (California) and St. Helens (UK). The company plans to make investments between 350 million Swiss Francs (approximately $431 million) and 400 million Swiss Francs (approximately $493 million) in 2026.

Last week, Bachem announced plans to build a large-scale production facility in Sisslerfeld with an investment of more than 500 million Swiss Francs (approximately $618 million) in the greenfield project, as part of a strategic collaboration.

“We signed an agreement with the partner to supply large volumes of peptides as part of our strategic collaboration,” Stoller told analysts on Thursday. “We expect commercial production in 2030 out of our Sisslerfeld site. We are also continuing to invest in our U.S. sites. Both in high volume capacity, that is primarily at our Vista site, and we are also modernizing and automating our small volume production at our Torrance site.”

Stoller noted the land that Bachem acquired for the Sisslerfeld project is “very large” with “much more space” for future additions and buildings. The company’s overall investment in the Sisslerfeld site could reach more than 1.2 billion Swiss Francs (nearly $1.5 billion) with additional partners, she said.

Given what Stoller described as an unprecedented global demand for peptides, she said Bachem is pursuing large-scale capacity expansions and investments in advanced manufacturing technology to unlock further capacity to address the growing peptide market, driven by diabetes and obesity — with future growth expected beyond metabolic diseases.

Oligo market also poised for growth

Oligonucleotide-based therapeutics are helping to redefine treatment strategies for rare diseases, cancer, and metabolic disorders. Bachem expects some larger indications and volumes will drive the market for oligonucleotides in the next couple of years, according to Stoller.

“We’re very pleased and very happy with the development in our oligonucleotide pipeline, both in terms of numbers and quality of projects, but also from a contribution,” she said, while noting oligonucleotide sales are not related to Bachem’s new Building K facility. “We see also here that oligonucleotides are proceeding very well from a sales and also profitability point of view.”

A new report from MarketsandMarkets estimates the global oligonucleotide CDMO market will grow from $2.51 billion in 2024 to $6.73 billion by 2029, with a compound annual growth rate of 21.8% during the forecast period. According to the report, the leading companies in the oligonucleotide CDMO market include Agilent Technologies, Bachem, Lonza, Thermo Fisher Scientific, and WuXi AppTec.

“We are not afraid of competition,” Stoller emphasized. “Competition is entering the market. Competition in the market is changing or consolidating. We just need to make sure that our offering remains very attractive and competitive.”