Five minutes at CPhI North America with

Lee Karras, CEO of Halo Pharma

PH: What does Halo Pharma do?

Karras: Halo Pharma is a CDMO, manufacturing both clinical and commercial drug products – traditional small molecule, solid dose, topical products and oral solutions. We have two plants, one in Whippany, New Jersey, and outside Montreal. Since 2015, both sites have been internationally approved by the MHRA, EMA, Health Canada and the FDA. We are known for narcotics, which have to be produced in the US for the US market. Whippany is probably one of the larger narcotics manufacturing sites in North America.

PH: Is narcotics still the biggest part of your business?

Karras: Yes, but we also produce for a variety of indications – CNS, cardiac, dermatology products, including modified release products and complex formulations. Customers come to Halo because we cover a large variety of dosage forms, which you typically cannot find under “one roof”.  Halo is also very flexible and this coupled with our breadth of services differentiates us from the “mom and pop” small CMOs as well as the larger CMOs who are typically less flexible. We also cover the whole development continuum.   Some customers come to halo with just API and no formulation, while others  have an idea of what they want us to do, it varies.

PH: How was last year for Halo?

Karras: Last year was the best Halo has had since its inception, with 20% growth. We are expecting double-digit growth again this year. 80% of our business is repeat. We have many customers  working with us on  multiple molecules and different dosage forms. Many are Large Pharma and there is a 50-50 split between branded products and generics. Large Pharma formulators who are local to the northern New Jersey region, typically  drive over to Whippany that day and can be back that night which they find less onerous than flying to the southeast or Midwest – and there is also a lot of pharma in Montreal, it’s a kind of mini-pharma hub for Canada.

PH: Have there been any significant investments recently?

Karras: We invested over $6 million to expand our capabilities at Whippany last year.  The investment centered around abuse deterrent modified release narcotics production.  In Montreal, we have made investments of over $1 million to expand our solvent coating  capabilities for tablets. This was done for a  particular customer’s product that required coating for taste-masking purposes for a pediatric product that was not stable with water. This was a unique situation where the  customer looked extensively for this capability but couldn’t find anyone to do it. Finally, we are in the middle of another $3 million investment for a set of suites at Whippany for a major generic that will launch later this year. It will probably be the biggest launch we ever had and could grow revenues by another 30%.

PH: I understand pediatric dosage form development is a key capability of yours. Can you tell me more?

Karras: All we did was listen to our customers. Several asked us to help develop pediatric versions of approved adult drugs for patent exclusivity extensions, or because the FDA required it as part of a phase IV commitment. It’s not as straightforward as taking the pill and shrinking it – and it’s different with every drug. A lot of what we are seeing are modified release products to be taken at most twice a day, which may need to be taste-masked or have the whole dosage form changed from a tablet to granules for reconstitution and everything in between. We have developed enough expertise around these products that we started promoting it more and we are seeing continued interest in pediatric dosage form development as a result.. Large pharma companies tend to develop products for large populations rather than subsets. Often they don’t have a lot of focus on pediatric patient populations. They may have a granulation expert but won’t connect the dots between needing to granulate something and turn it into a powder in a stick pack. We can connect those dots.