A Decade of Data Scott Billman, Biogen Larry Kranking, Commissioning Agents, Inc. Jim McGlade, AIA, BHDP Architecture ISPE CASA Technology Conference March 31, 2016

Agenda Welcome Overview of FOYA Program Submittal Data Review 2005-2015 Industry Trends 2005-2015 Future Trends

FOYA Overall Winners

FOYA Program Overview Purpose Annual program that recognizes state-of-the-art projects utilizing new, innovative technologies to improve the quality of products, to reduce the cost of producing high-quality medicines, and demonstrate advances in project delivery Categories Equipment Innovation Facility Integration Operational Excellence Process Innovation Project Execution Sustainability Facility of the Future (beginning 2016) Submittals to date >150

Project Delivery Methods

Types of Facilities

Submissions by Regions

Facility Types - Asia

Facility Types - Australia

Facility Types – Europe

Facility Types – North America

Facility Types – South America

Submittal Data Review 2005-2015 Average Project Area 109,279 sf 10,156 sm Total Direct Costs $604/sf $6,459/sm Total Installed Costs $780/sf $8,359/sm Total Project Costs $843/sf $9,068/sm Submittal Data Review 2005-2015 ALL PROJECTS

Submittal Data Review 2005-2015 Average Project Area 128,667 sf 11,958 sm Total Direct Costs $767/sf $8,255/sm Total Installed Costs $948/sf $10,197/sm Total Project Costs $1,034/sf $11,121/sm Submittal Data Review 2005-2015 PARENTERAL Over 60% delivered by Design/Bid/Build method (highest) 25% submitted in 2011 1% under budget 11.5% Out-of-House Engineering fees 8.8% Construction Management fees

Submittal Data Review 2005-2015 Average Project Area 100,917 sf 9,379 sm Total Direct Costs $937/sf $10,082/sm Total Installed Costs $1,318/sf $14,180/sm Total Project Costs $1,571/sf $16,902/sm Submittal Data Review 2005-2015 BIOLOGICS 98% of submissions from North America and Europe 31% delivered by GMP method (highest %) 7% under budget 17.9% Out-of-House Engineering fees 12.7% Construction Management fees

Submittal Data Review 2005-2015 Average Project Area 53,472 sf 4,969 sm Total Direct Costs $451/sf $4,855/sm Total Installed Costs $487/sf $5,237/sm Total Project Costs $504/sf $5,421/sm Submittal Data Review 2005-2015 API 98% of submissions from North America and Europe 0% delivered by GMP method 7% under budget 7.3% Out-of-House Engineering fees 4.8% Construction Management fees

Submittal Data Review 2005-2015 Average Project Area 89,255 sf 8,295 sm Total Direct Costs $292/sf $3,142/sm Total Installed Costs $329/sf $3,537/sm Total Project Costs $330/sf $3,550/sm Submittal Data Review 2005-2015 LABORATORIES 63% of submissions from North America All delivery methods used 19% under budget 10.0% Out-of-House Engineering fees 6.2% Construction Management fees

Submittal Data Review 2005-2015 Average Project Area 139,096 sf 12,927 sm Total Direct Costs $281/sf $3,025/sm Total Installed Costs $340/sf $3,661/sm Total Project Costs $382/sf $4,113/sm Submittal Data Review 2005-2015 Oral Solid Dosage 67% of submissions from Europe All delivery methods used 5% under budget 14.2% Out-of-House Engineering fees (12% w/out largest project) 14.9% Construction Management fees (8% w/out largest project)

Industry Trends 2005-2015 Endless repositioning – mergers, acquisitions, & partnerships Average time to develop a drug > 10 years Clinical trial approval % rate R&D spending increased 28% Revenue increased 63%

Industry Future Trends Endless Repositioning will continue Projected growth – 5% annually Maturing Market Opportunities Biologics Growth Gene Therapy Disposables

Facility of the Future Constants Changes Still the last piece of the pill puzzle Premium for speed Changes Flexibility Sustainability Continuous manufacturing & quality verification Real-time release testing Technology

Discussion, Questions, Comments