Catalent, Inc. – the leading innovator in developing and providing better treatments for patients worldwide – has released a business update for its third fiscal quarter ending March 31, 2023. Unfortunately, the Company has experienced productivity issues and higher-than-expected costs at three of its largest manufacturing facilities, which will have a negative effect on its financial results for the third quarter and its outlook for the remainder of the 2023 fiscal year.
Catalent is pleased to announce that Ricky Hopson will become Interim Chief Financial Officer, starting April 14, 2023. The company is actively seeking a permanent CFO through a leading, global executive search firm. With Ricky now on board, Catalent is well-positioned to achieve its financial goals and continue its success.
Business Update
The Company’s gene therapy manufacturing site in Harmans, Maryland near BWI airport faced productivity issues during its third quarter ramp-up. The deployment of a new enterprise resource planning (ERP) system slowed the expected revenue associated with the site, thus impacting the fourth quarter results as well. Despite the operational challenges, the Company is determined to increase its capacity in order to meet the demands of its customers.
Due to the successful completion of important regulatory inspections at the BWI site, our resources were redirected to address ERP-related challenges that arose. Despite the delay in resolving these issues, we were able to ensure that our production of financial statements remained accurate and on-time.
Although the quality and commercial launch quantities of any product made at BWI are unaffected, we regret to report that revenue from the unproduced batches in this fiscal year cannot be realized due to manufacturing capacity constraints. Nevertheless, we remain hopeful that we will be able to recoup these losses during the second half of calendar year 2023 (the first half of the Company’s 2024 fiscal year).
In the third fiscal quarter, the Company experienced productivity challenges and higher-than-expected costs at its drug product and drug substance manufacturing facilities in Bloomington, Indiana and Brussels, Belgium.
These issues, which were due in part to the need to implement operational and engineering controls following regulatory inspections, are expected to continue to impact the Company’s fiscal fourth quarter.
Unfortunately, the Company will not be able to make up for the lost production at Bloomington until after the close of the current fiscal year. However, productivity levels in Bloomington are expected to be restored to previously forecast levels in the fourth quarter.
After a comprehensive internal review of its manufacturing operations, the Company has implemented critical management and operational changes at its BWI, Bloomington, and Brussels sites in order to address the underlying issues identified. These measures are designed to improve the effectiveness and efficiency of the Company’s manufacturing processes.
Ricky Hopson Named Interim Chief Financial Officer
Ricky Hopson has been named Interim Chief Financial Officer of the Company, starting April 14, 2023, succeeding Thomas Castellano, who had been serving as Senior Vice President and Chief Financial Officer until his departure on April 13, 2023. Prior to this, Ricky had been the Company’s President, Division Head for Clinical Development & Supply.
Ricky is an accomplished financial executive with a deep understanding of Catalent, and he is ready to take the reins as interim CFO. We are also grateful for the 15 years of service that Tom provided to the company, including playing a key role in the successful initial public offering in 2014. We wish Tom all the best in his future endeavors.
Mr. Hopson, 47, is the President, Division Head for Clinical Development & Supply of the Company, a post he has held since July 2022. With more than two decades of experience in the field of finance, Mr. Hopson has held many roles within the Company, such as Vice President & Chief Accounting Officer, Vice President & Corporate Controller, and Global Vice President of Operational Finance. He graduated from the University of Portsmouth and is a chartered management accountant in the U.K.
About Catalent
Catalent, an S&P 500® company, is the global leader in the development, delivery, and supply of personalized medicines, consumer health brand extensions, and blockbuster drugs. With a broad and deep range of expertise in development sciences, delivery technologies, and multi-modality manufacturing, Catalent enables pharma, biotech, and consumer health partners to optimize product development, launch, and full life-cycle supply.
Each year, Catalent helps accelerate over 1,000 partner programs, launch over 150 new products, and supply around 80 billion doses of nearly 8,000 products. Its expert workforce of approximately 18,000 includes more than 3,000 scientists and technicians. Headquartered in Somerset, New Jersey, Catalent generated nearly $5 billion in revenue in its 2022 fiscal year.