KD Pharma Group – Tech-Driven Pharma

The KD Pharma Group is a pharmaceutical company using innovation and a motivated team to evolve from a small family company to a globally recognised contract development and manufacturing organisation.

KD Pharma has been on the market for a long time, since 1989, and it has always been run as a pure family business. But in the last few years, it has undergone a dramatic transformation.

“When it started out KD Pharma was really tiny in the Omega-3 world. Then in 2013, we engineered a buyout with the management and our private equity firm, Capiton, to bring the company to the next level,” says Oscar Groet, CEO of KD Pharma Group. “We industrialised the company from a single workshop to an enterprise with five manufacturing sites in North America and Europe. Over the last four or five years, we have brought in a lot of new equipment. Additionally, we have integrated Marine Ingredients, a company that was itself a small conglomerate of different companies.”

Today KD Pharma owns a plant in Bexbach, Germany, purpose-built by the company, a plant in Homburg, Germany, which is a converted old Nestle plant, a plant in Norway bought from BASF, a plant in the UK originally built by Lundbeck Pharmaceuticals, and a plant in Miami, bought from Aenova.

“KD Pharma has bought a range of state-of-the-art facilities from different multinational organisations. We have built a large customer base across two segments: pharmaceuticals and nutraceuticals. We’ve always stayed on the business-to-business side of these markets, but what brings all these structures together is that we are an absolute technology leader,” Groet explains. “We are really known for the breadth of our technology portfolio. Many of our competitors have one or two technology sweet spots, but we have all the necessary capabilities to be a full-service CDMO and API producer and have invested heavily in the technology and capacity expansion for business growth.”

The Technological Edge

KD Pharma has been historically focused on the Omega-3 ingredient business, expanding its volumes on the back of the Omega-3-based drug, Lovaza. It is an area where KD Pharma technology leadership has enabled its growth.

“We use chromatography technology,” Groet says. “There are two key molecules in Omega 3, and the Lovaza drug can provide precise ratios of these two molecules. Our competitors purify the ingredients at roughly the same ratio as their raw material source, but we use chromatography processes that enable us to match a wider set of customers’ specifications. This gives us the flexibility to run the business in a differentiated way, as we can use any raw material oil to meet market demand.”

KD Pharma has grown to be the second-largest producer of Omega-3 products in the world, competing mainly with large conglomerate multinationals in these markets. Talking with Groet it is clear he has much bigger ambitions for the company still.

“The current phase in KD Pharma’s lifecycle started at the end of 2019 when we set new targets for ourselves. KD Pharma was transferred into a separate investment fund to enable our investors to participate specifically in the company’s future growth. This allows us to better add capital for our next growth phase,” Groet says. “We have a very strong position and a lot of technologies and facilities that can do far more than manufacturing our traditional product portfolio.”

This is why KD Pharma has begun transforming itself into a full-fledged CDMO. As a result, the company recently acquired additional manufacturing assets and technologies from an established CDMO pharmaceutical chemical API company and is now transferring those assets to its UK plant.

“We also have very strong partnerships with several third parties to develop drugs for rare cancers and COVID, and acquired specific equipment from a pharmaceutical cannabinoid company that we’re installing at the moment to expand into plant extracts,” Groet says. “It again gives us a very broad range of technologies to serve customers in these markets. It makes us flexible and enables us to manufacture products using both natural extraction and chemical synthesis routes, with verticals in the cannabinoid and Omega-3 sector. We complement this with capabilities further down the value chain from our API and Nutraceutical manufacturing with our softgel manufacturing plant in Miami doing packaging, bottling, and producing turnkey products for customers.”

KD Pharma offers 360-degree support to any pharmaceutical or nutraceutical company that would like to use its capabilities to develop and manufacture its products and continues to actively explore additional international acquisitions to broaden its portfolio and services even further.

A Natural Evolution

All of these efforts are contributing towards the ongoing story of KD Pharma’s evolution.

“We have evolved from a family company to a well-developed, professional enterprise with exceptional management capabilities and competencies too,” says Groet. “We’ve recruited leaders that have broad international experiences in renowned multinational companies. At the same time, we share a strong entrepreneurial, customer-centric spirit, that really defines the culture of the company. We pride ourselves for being agile and decisive, able to quickly implement new ideas, but still functioning within the required levels of compliance required by our customers.”

As a result, KD Pharma has built a reputation for itself as being very strong on service, despite being relatively small in comparison to its multinational competitors.

Due to the nature of the products and services KD Pharma provides, its Quality Management System uses the strictest standards available from each market and product, whether they come from the U.S (US FDA), UK (MHRA), Europe (BFARM) or Asia (MFDS, etc). Products produced by KD Pharma are often cited as having more stringent quality limits and thresholds than those set by local and international authorities (US, EP, etc).

The quality of KD Pharma products is reflected in the numerous certifications, successful authority inspections and customer audits achieved by the company over the last 30 years.

“We try to provide a better service level experience with superior quality, and we strive to be fast and decisive to keep an edge in the marketplace,” Groet says. “Moreover, having invested so heavily in a broad technology base proves to be another clear advantage because it gives us the flexibility to be competitive in the market.”

By carefully selecting the team and encouraging an enterprising spirit, Groet feels KD Pharma blends the qualities of entrepreneurial and agile companies with the sophistication of a multinational operation.

“At a certain point in life you want to do more and see the actual results,” he says. “What was always there was the drive to be flexible and not accept what is given to you. We have a clear vision and we are executors. That is why we have grown so quickly. You need to get that spirit out there.”KD Phama

It is a philosophy embedded in KD Pharma’s hiring practices.

“You still need strong competence with specific skills and experience, but you need people that have that entrepreneurial drive,” Groet insists. “You need people who want to do more and truly put themselves in the game. We attract these people by continuously reaching out and meeting people. We look to have true diversity within the company. We hire apprentices, we hire people that have had sector experience different from ours, who have been in different countries, and ultimately learned in different environments. This fuels creativity and helps us to find new ways to solve problems and be successful.”

Finding these types of people is critical for KD Pharma, given the nature of the ever-changing markets in which the company operates.

“Despite working in a highly structured and regulated environment, we go to where the markets haven’t been conquered yet, so we need people who can structurally work outside their comfort zone, challenge themselves, deal with uncertainty, and make decisions on a 70% knowledge basis,” he tells us. “We were relatively lucky when we built the company, in that we could create an environment that encouraged that culture and mindset. We are a big melting pot. We bring together people from different countries, nationalities, cultures, and backgrounds. We are a real mixed bag of people and personalities because we believe different people and the diversification of backgrounds creates breakthrough ideas. That is what we have done, and ultimately that’s a key driver of our extraordinary growth story.”

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