An explosion at a chemical plant in China that killed 62 people not only exposed weaknesses in China’s safety oversight but it also exposed weaknesses in the global ingredient supply chain. The disruption from the blast has exacerbated shortages for Swiss pharma and chemical supplier Lonza.
In a “qualitative look” at its first-quarter results, which included almost no financial figures, Lonza’s new CEO Marc Funk said the company’s CDMO business is rolling along nicely, powered by biologics projects. The disruption from explosion in China, however, contributed to “headwinds” for the company’s specialty ingredient business.
Funk said all of its ingredient businesses face “raw material shortages and supply-chain disruptions” from China’s efforts to clean up chemical pollution in the country as well as by “a major chemical plant explosion in China.” He said the company is taking additional “cost containment” steps to overcome those headwinds.