Press Room

News / Mar 22, 2021

Guy Villax speech to the Informal Meeting of Ministers Responsible for Competitiveness

EU Presidency: COMPET - Internal Market and Industry

Informal Meeting of Ministers Responsible for Competitiveness (COMPET) | Hovione

 

Dear representatives of the Commission, Dear Ministers, Ladies and Gentlemen, Good-Morning

It is a privilege for me to address you.

 

Dear Pedro thank you for giving me this opportunity.

 

I have been fortunate to have a front row seat watching the Pharmaceutical Industry since I was born, that was 60 years ago. Hovione was founded by my father, a Hungarian refugee, in the basement of our home in Lisbon. Often as children we could not go into the garden because a bromination was going on a l’air libre for safety reasons!

My first job in the family business, aged 24, was selling active ingredients made in Portugal to Indian firms in Bombay, Madras, Delhi and Goa.

 

I will start by telling you about the successes of our industry and end with our failures as these are the ones we need to collectively tackle.

 

10 years after the HIV virus was discovered in Paris and Washington, American companies invented the protease inhibitors that would treat this horrible disease. But who made these complex molecules industrially possible then were exclusively European companies.

 

In the last decade several cures for Hepatitis C were discovered. Over 4 million patients have been cured and ¾ of those with pills made with a Hovione process with product that came out of our plants in Portugal and Ireland.

 

It is also important to acknowledge the complexity of the manufacturing processes and the extreme specialization that each step requires. Remdesivir, one of 3 approved therapies for Covid-19 needs factories in two continents just to make the active ingredient, but it won’t work without an enabling excipient called Captisol® that Hovione makes exclusively. To face the pandemic’s tremendous demand we are now making per month what we usually made per year.

 

Europe has 600+ plants that have the science, the technology, the know-how and the capacity to be the workhorse of innovative medicines for global supply. For most of us it has been some time that we have stopped focusing on serving the generics industry of our home market, Europe. Hovione has not supplied one kilo of a generic API to Germany for 15 years because one cent of difference means the Indian product is preferred. Had we not exported to the USA and served innovators and generics there we would be bankrupt, or weak and unable to invest in R&D and new technology.

 

The beauty of the pharma ecosystem is that the very high prices of patented products pay for the R&D and the risk, but as soon as the patents expire the best science can be had for a few cents per pill. Innovative drugs, under patent, and the large multinationals are today a minority volume player – over 80% of prescriptions are filled by generics.

 

Today the EU is not in control of its generic medicines – we face frequent shortages and a geostrategic fundamental dependence for APIs and precursors from India and China – where serious accidents, government policies and market failures make us vulnerable. 

 

We have ended up in this untenable situation due to 1) the unbridled market forces of globalization and 2) 30 years of EU regulations that failed to consider that pharma is an intensely globalized and highly competitive industry.

 

Europe was once the cradle of pharmaceuticals. In the 50s any American that wanted to study chemistry had to learn to speak German as all good text books were written in German. We have faced a 30 year decline – today in the top 10 largest generic firms in the world only 1 is European.  

 

As an industry we survived by moving away from intermediates and generic APIs – including the essential ones – and focusing on high value innovative products. The world is competitive and if the climate in Europe in unfavorable to certain segments, factories move – it is that simple.

 

Nobody saw the unfolding of this radical structural transformation.

Nobody heard Industry’s calls for levelling the playing field.

 

 

In 2004 the EU API industry founded EFCG, the European Fine Chemicals Group, a member of CEFIC, to level the playing field, this need remains. 

 

In my first trip to Brussels to flag the growing risk to patients and the lack of level playing field, in 2005, I was met with bemusement, étonnement and some sarcasm. In 2007 I testified at a hearing of a sub-committee of the US congress in connection with the risks to patient from imported APIs. I went public and frequently said and wrote that EU Regulators inspected on proximity not risk. The contaminated heparin tragedy that killed over 150 patients occurred in 2008. By 2011 our advocacy work resulted in the Falsified Medicines Directive, too little, too late. 

 

Today price pressure has driven the European Generics supply chain to, in 74% of cases, buy from low-cost countries. These production locations have low regulatory oversight therefore present higher risk to patient, often cause environmental damage and antimicrobial resistance because of poor control over wastes, and have a high frequency of deadly accidents – the EU industry cannot compete with such low standard, low cost operations. 

 

In summary in the last 30 years a large part of the EU API and intermediates industry disappeared to the benefit of its competitors. Certain key technologies (eg fermentation, nitration, halogenation) almost disappeared from Europe. This represents a damaging loss of critical mass, as these technologies act as platforms that allow the production of many different APIs.  Fermentation is key to making many antibiotics. Without fermentation Europe is now totally vulnerable and dependent on supplies from Asia/China.

 

To reduce this dependence and to ensure the resilience of the medicines supply chains on the long term, the only solution is to rely on the robust, reliable, competitive and sustainable manufacturing capabilities we still have in Europe.

 

So what are Industry’s proposals in this regard?

 

  • First, we must support the existing European manufacturers of APIs and intermediates in the on-shoring of technologies that will guarantee the supply of the essential medicines. Dual sourcing of the essential medicines must be a cornerstone of our policies.

 

  • Second, level the playing field with other world regions to ensure that import and purchase requires not only verified compliance with GMPs, but also demands process safety, respect for the environment and an absolutely reliable supply chain. Linking the purchase of critical supplies to the sole criteria of price cannot be a sustainable supply strategy.

 

  • Third, we need a long-term EU industrial policy that can accelerate sustainable Research, Development and industrialization of innovative and green technologies, as well as manufacturing capacities within the EU territory.

 

  • Fourth, regulatory centralization, transparency and flexibility. EMA must be given more clout. We need a central record of EU shortages.  EMA must know the complete supply chain mapping of each medicine, so it can act. EMA should turn into a compliance matter the good example of the Swedish regulator that considers environmental aspects when granting permits and approving products and APIs.

 

We are optimistic that this straightforward strategy will be successful to eliminate not only existing drug shortages but more importantly avoid future risks of shortages.

 

 

Europe can rely on its the 600+ existing manufacturing sites, on its strong innovation capacity, its highly-trained workforce to reverse the trend and build back a robust pharmaceutical industry in Europe.

 

Industry is involved in the Commission’s EU Pharma Strategy Structured Dialogue. We are looking forward to working with the Commission to implement, as quickly as possible, the appropriate structural, pragmatic and efficient measures to support our industry. 

 

However as we embark to build the future and drive a Renaissance of the European API and generic industry it is imperative that we first look into the past and understand what got us into this situation of dependence and weakness. 

 

The US and Japan have already launched countermeasures, we must work with our allies and not independently.

 

An EU patient centric pharmaceutical industry needs a EU centric pharma supply chain with a sustainable EU manufacturing base, this requires deliberate and careful regulation to compensate for market forces and to correct the playing field.

 

European citizens deserve medicines that are Affordable, Accessible and most importantly Available. 

 

Dear Commission representatives, you can count on me and on our industry associations to fill in the blanks, spend time analyzing the situation and design a solution for the future.

 

Thank you for your attention.

 

Guy Villax
CEO, Hovione
Lisbon, 22nd March 2021

PDF version

 

 

 

Find more about this virtual event at 2021portugal.eu

 

 

Also in the Press Room

See All

A mechanical engineering graduate, this Frenchman is the CEO of the Portuguese pharmaceutical contract manufacturer Hovione. Still owned by the founding family, the company was awarded the 2025 ‘Léonardo de Vinci’ Prize, which recognizes the innovative and successful succession planning of family businesses. With an international career behind him, Jean-Luc Herbeaux is almost more fluent in English than in his native language. At 58, this Frenchman with iceberg-blue eyes is the CEO of Hovione. Founded in the late 1950s, this Portuguese group, with 100% family ownership, has just received the ‘Léonardo de Vinci’ Prize, which highlights entrepreneurial successes tinged with family legacy. While this mid-sized company with a turnover of €500 million maintains a low profile, its pharmaceutical contract manufacturing business is just as obscure to the general public. "Yet, the market for contract manufacturers, or 'contract development manufacturing organizations,' is worth $200 billion", emphasizes the CEO, who has been working in this microcosm for two decades. 500 patents Aware of the stakes, he does not deny "the pharma industry's dependence on Indian and Chinese capabilities". "The fact remains that the trend is toward the regionalization of supply chains, with European manufacturers producing for the Old Continent, American manufacturers for their own market, and so on", he says. And to highlight the foresight of Diane and Ivan Villax, the founding couple, "who thought globally from the very beginning". As a result, the group, with its 500 patents, has factories in China, the United States, and Ireland, without neglecting its home territory. This is evident by the site currently under construction on the banks of the Tagus River, following a €200 million investment. "The heavy engineering and compliance aspects are being finalized, "he explains, emphasizing that this highly regulated sector "is under a microscope". He knows this all too well, as Hovione claims to be involved in 5 to 10% of the drugs approved each year by the FDA, the American drug regulatory agency. Professor from Houston to Japan “In this small world, having a good image is important: this is the case with Jean-Luc, passionate about his work, but who knows how to demystify things”, observes Elie Vannier, former chairman of the board of Hovione. He adds that having an international profile is a strength “in this ecosystem where talent and clients are international”. For his part, Jean-Luc retains from his numerous flights “a taste for films of all genres and from all countries”. The son of an administrative employee in secondary schools and an auto insurance expert, the youngest of three children moved around according to his parents' job transfers. He was born in Meaux, grew up in Chartres, and attended the University of Technology of Compiègne, “which already offered programs abroad”. Thus, he left a mechanical engineering internship at a Dior perfume factory to join the University of Houston in Texas, "carrying a 20 kg backpack". Despite his then-limited command of English, he earned a doctorate, became a professor, and met an American woman who would become his wife and the mother of their two children. Next came the University of Kanazawa in Japan. Alas! Disappointed by the academic world, "where you have to fight to get resources", he succumbed to the allure of industry and joined the American chemical company Rohm and Haas, which had fallen under the control of the German company Evonik. 80 million patients He spent twenty years there, in Germany and Singapore, before "accepting the offers from headhunters". He then accepted Hovione's offer, who appointed him Chief Operating Officer in 2020, then CEO two years later, making him the first CEO not from the founding family. The family remains the sole shareholder, which earned the company the ‘Léonardo de Vinci’ Prize, created by the Association Les Hénokiens and the Clos Lucé. Having settled near Lisbon, he substituted walking for combat sports, "having been burned by the injuries of some friends". He also mentioned that Hovione, whose clients include 19 of the world's 20 largest pharmaceutical companies, helps treat more than 80 million patients.   (Translated version)   Read the original and full article in French on LesEchos.fr  

Article

Jean-Luc Herbeaux aims to boost the growth of the pharmaceutical group Hovione

Dec 02, 2025

The CDMO’s New Jersey manufacturing site expansion will eventually cover more than 200,000 square feet. Portugal-based contract development and manufacturing organisation (CDMO) Hovione has completed an initial $100 million investment round in its East Windsor, New Jersey site. Once completed it will increase the facility’s footprint to more than 200,000 square feet and more than double its capacity for spray drying. Hovione CEO Jean-Luc Herbeaux said: “Since launching our New Jersey operations in 2002, Hovione has been one of the longest established European CDMOs in the United States. “This investment reinforces Hovione’s leadership in spray drying – a core technology platform where we have built extensive know-how and capabilities. By continuing to advance our platforms and expand capacity in the US, we are strengthening the foundation that enables our partners to bring complex medicines to patients more efficiently.” Spray drying is an increasingly important particle engineering technology for improving drug bioavailability through the amorphous solid dispersion (ASD) that can address bioavailability or crystallisation challenges. The initial phase of Hovione’s expansion will include a 31,000-square-foot building to house two size-3 spray dryers (PSD-3) designed for ASD production. Construction at the New Jersey site is already underway and the company plans to start GMP operations in the second quarter of 2026. The initiative is part of Hovione’s long-term strategy to grow its US operations and enhance its integrated drug substance, drug product intermediate and drug product capabilities. Herbeaux said: “This investment addresses growing customer demand for US-based capacity and integrated solutions that shorten development timelines and reduce tech transfer complexity. By consolidating development, scale-up, and commercial manufacturing within a single quality and governance framework, we provide customers with seamless execution from drug substance to drug product.” The company’s New Jersey expansion fits into its wider international growth plan that also includes capacity investments in Ireland and Portugal as it seeks to create a network of autonomous sites spanning the development and commercialisation of APIs, drug product intermediates and drug products.   Read the full article at EuropeanPharmaceuticalReview.com  

Press Clipping

Hovione doubles spray drying capacity with $100m US investment round

Nov 04, 2025