How a Leading 'Water Seller' Behind China's Top 10 Pharma Companies, 985 Universities, and Key Laboratories Was Built: Insights from Bioengineering AG

In June this year, WuXi Biologics announced the official completion of three sets of 5,000L single-use bioreactors for the second drug substance production line at its Drug Substance Manufacturing Facility 20 (MFG20). The facility commenced commercial operations in 2021. With the new single-use bioreactors becoming operational, its capacity will increase from the current 8,000L to 23,000L.

In February two years ago, the U.S. Department of Commerce added WuXi Biologics and 32 other Chinese entities to the “Unverified List” (UVL), subjecting these companies to import reviews on a range of production equipment, including single-use bioreactors. The day after the news broke, shares of listed CXO companies in China fell collectively, triggering turmoil within the industry.

Why Are Bioreactors Disrupting the Healthcare Industry? What Are Their Key Roles in the Biopharmaceutical Sector? How Is the Industry Developing Domestically and Internationally?

In this issue’s special feature on biomanufacturing, VCBeat takes Swiss company Bioengineering AG (“Swiss Bioengineering”) as a case study. By examining Europe’s oldest enterprise in the manufacture of modern biosystems for microbial fermentation and animal/plant cell culture, we aim to provide insights and inspiration for the industry.

In fact, the history of reactors dates back to ancient times. In the ancient Middle East, local Arabs used sheep stomachs to store sheep's milk. Due to the presence of natural chymosin (rennet) in the sheep stomach, this enzyme catalyzed the limited hydrolysis of proteins in the milk, serendipitously transforming it into cheese. The sheep stomach that facilitated this conversion effectively functioned as a reactor.

Alcohol consumption was prevalent during the Shang and Zhou dynasties more than 3,000 years ago. Ancestors placed grains in sealed environments, utilizing enzymes generated during grain germination to saccharify the raw materials into sugars, which were then converted into alcohol by yeast. The sealed vessels used in this brewing process also represent an early form of bioreactor.

Although reactors have a long history, the term “bioreactor” did not gradually appear in professional journals and books until the 1980s.In bioengineering, a bioreactor refers to a device used for the in vitro cultivation of microorganisms and cells, enabling the production of various target products and pharmaceuticals through biochemical reactions or the metabolic activities of the organisms themselves. It is a core piece of equipment in the field of modern biomanufacturing.

Bioreactors are generally classified by material into stainless steel bioreactors and single-use bioreactors, both of which have their respective markets in the biopharmaceutical industry. Determining which type of bioreactor to select is a non-standard decision, influenced by comprehensive factors such as market size and product characteristics, as well as the extent to which cost impacts selling price.

To date, in the field of biomedicine, virtually all processes involving cell metabolism and cell culture require the use of bioreactors. Bioreactors have provided a foundational platform for the development and industrialization of genetic engineering, fermentation engineering, cell engineering, enzyme engineering, and protein engineering. Therefore, bioreactors are often referred to as the “heart” of the biopharmaceutical and biotechnology industries.

The typical full life cycle of biopharmaceuticals begins with upstream raw material input, proceeds to midstream research and development and quality control, followed by midstream manufacturing, and finally involves downstream production.

Among these, midstream R&D includes preclinical studies and Phase I, II, and III clinical trials. Preclinical studies involve stages such as cell bank establishment, cell culture, purification process development, and formulation optimization. Midstream manufacturing must progress from small-scale trials and pilot-scale trials before reaching commercial-scale production. For biopharmaceuticals produced via animal cell culture, bioreactors play a critical role in all stages of the midstream process, and advancements in bioreactor technology have further driven the development of the biopharmaceutical industry.

In particular, the protein-based pharmaceutical industry, which is built on “animal cell culture” technology, has become a key focus of development in biopharmaceuticals. Products manufactured using this technology include humanized and fully human therapeutic antibodies, polysaccharide-engineered proteins, and novel-target biologics. Bioreactors are indispensable core equipment for animal cell culture and play an increasingly important role throughout the entire lifecycle of biopharmaceutical products.

Products with essential demand attributes naturally have a matching market. According to a report by Mordor Intelligence, the bioreactor market size is estimated at USD 5.45 billion in 2024 and is projected to reach USD 7.79 billion by 2029, registering a compound annual growth rate (CAGR) of 7.45% during the forecast period (2024–2029).

In the reactor industry, which boasts a long history and a steadily expanding market, Bioengineering AG undoubtedly holds a prominent position.

Bioengineering AG is Europe’s oldest and globally renowned company in the field of modern bioreactor system manufacturing (microbial fermentation, animal and plant cell culture). Inheriting Switzerland’s centuries-old tradition of rigor and meticulousness, the company has remained dedicated to the design and manufacture of bioreactors since its establishment in 1972. With over fifty years of technological expertise, it has developed a comprehensive product portfolio.

Currently, Bioengineering AG’s primary business activities include the manufacturing of bioreactors—such as microbial fermenters, animal/plant cell culture vessels, and enzyme reactors—with a product portfolio spanning laboratory, pilot, and large-scale production capacities. The company also offers various bioreactors and auxiliary equipment for bioengineering processes, including sterile diaphragm valves in diverse specifications, piping systems, aeration and ventilation devices, and sterile filtration equipment. Additionally, Bioengineering provides engineering services encompassing the retrofitting of existing facilities, as well as the planning, design, and construction of new plants.

With a history spanning over 50 years, Bioengineering AG has not succumbed to a “midlife crisis” amidst the passage of time; instead, it has consistently reinvented itself within this rapidly evolving industry.

During its first decade, Bioengineering developed and launched the first pilot-scale systems based on the “aseptic automation” principle, including the LP351 modular pilot-scale fermenter and the L1523 modular laboratory fermenter. Fifty years ago, the various technical modules involved in these products—such as aseptic sealing, temperature circuits, and control thresholds—were state-of-the-art.

As a result, the company earned its first pot of gold by securing a million-franc order from Sandoz. Subsequently, Bioengineering Switzerland launched gravimetric feeding systems and rotary filters, which are now widely used, as well as modular pilot-scale and laboratory equipment tailored to specific process requirements, inductive hollow-shaft measuring devices for determining impeller power in bioreactors, small-scale laboratory fermenters, and other instruments and ancillary equipment. Consequently, the company successively received orders from Boehringer Mannheim, Pfizer, Bayer, and other corporations.

By the 1980s, Bioengineering AG of Switzerland had set new production records, securing collaborative orders from research institutes and large enterprises such as BASF, Bayer, the Institute of Microbiology of the Czech Academy of Sciences, Beecham Pharmaceuticals, and Connaught Laboratories. The company helped its clients construct large-scale fermenters, interferon plants, facilities for the large-scale production of coagulation factor VIII, biotechnology pilot-scale facilities, tetanus vaccine production facilities, isomaltulose plants, sugar substitute plants, as well as various types of biotechnology equipment.

In the 1990s, Bioengineering AG established a sales office in China and continued to expand its collaborations with global enterprises. In the 21st century, while expanding its industrial footprint, Bioengineering AG has also been continuously developing new systems, such as the Bioweight system, which determines the fill level in vessels by measuring the pressure differential between the top and bottom of fermentation tanks.

As can be seen, Bioengineering AG started from distant Switzerland and has developed into a globally renowned modern bioreactor systems company. Its strategies and layout over the past 50 years appear to lack any thrilling or dramatic legendary stories. Perhaps it is simply the inherent rigor and seriousness ingrained in the Swiss national character that has shaped this enterprise into an industry giant.

While maintaining a rigorous attitude toward its products, Bioengineering AG has by no means succumbed to the complacency and conservatism often associated with long-established companies. Instead, it has strategically positioned itself in emerging fields at their nascent stages. In the 1990s, when systematic biopharmaceutical research in China was still in its early developmental phase, Bioengineering AG entered the Chinese market. This move carried certain risks, but was driven primarily by its recognition of the mismatch between domestic supply and demand. It is precisely because Bioengineering AG established its market presence before the industry boom that it has been able to achieve its current growth.

To date, Bioengineering’s clients span the globe, including Ciba-Geigy (a predecessor of Novartis), GSK, Novartis, Bayer, Amgen, BMS, Eli Lilly, Schering Berlin Biologics (Germany), Pharmacia (acquired by Pfizer in 2002), Schering-Plough (acquired by Merck & Co. in 2009), Sanofi, and the University of Hamburg (Germany).

In China, Bioengineering AG has amassed a substantial client base, encompassing numerous research institutions such as Fudan University, the Shanghai Institute of Biochemistry and Cell Biology (Chinese Academy of Sciences), the Shanghai Institute of Cell Biology (Chinese Academy of Sciences), the State Key Laboratory of Contraceptives and Devices at the Shanghai Institute of Planned Parenthood Research (Chinese Academy of Sciences), the State Key Laboratory of Traditional Chinese Medicine at the Institute of Chinese Materia Medica, Shanghai University of Traditional Chinese Medicine (Chinese Academy of Sciences), Naval Medical University, the School of Biotechnology at East China University of Science and Technology, the Institute of Ecology (Chinese Academy of Sciences), the Institute of Biotechnology at the Academy of Military Medical Sciences, the Institute of Hematology & Blood Diseases Hospital at the Chinese Academy of Medical Sciences in Tianjin, Harbin Institute of Technology, Northeast Agricultural University, Northeast Forestry University, and the State Key Laboratory of Enzyme Engineering at Jilin University; as well as industry chain enterprises including United Cell, Fosun Industrial Cloning Company Research Institute, Qilu Pharmaceutical, Dong-E-E-Jiao, Kaiyin Biotech, Baitai Bio, and Jiuzhou Pharmaceutical.

It is worth noting that, as a leading domestic biopharmaceutical enterprise, China National Biotec Group (CNBG) houses the Gene Laboratory of the Beijing Weigu National Vaccine Center, as well as several affiliated research institutes—such as the vaccine and bacterial vaccine workshops of the Wuhan Institute of Biological Products, the Chengdu Institute of Biological Products, and the Shanghai Institute of Biological Products—all of which are equipped with Bioengineering’s laboratory-scale, pilot-scale, and production-line systems.

Why Can Swiss Biomed’s Customers Cover the Entire Industry Chain of Production, Academia, and Research? It Stems from Its Comprehensive Technology and Product Portfolio.

Depending on the different stages of research and development and production, bioreactors with varying volumes are suitable for laboratory-scale trials, pilot-scale trials, and industrial-scale production. Based on reaction volume, bioreactors can be classified into micro-, small-, and conventional-scale types.

Micro-scale bioreactors are generally used in the R&D stage for process optimization. Conventional bioreactors exhibit an order-of-magnitude increase in reaction volume to meet the requirements of laboratory-scale, pilot-scale, and commercial production.

Laboratory-scale benchtop reactors typically have a volume of 1–5 L. Pilot-scale reactors are categorized into laboratory pilot and plant pilot systems, with reaction volumes of 10–50 L and 100–500 L, respectively.

Commercial-scale production volumes vary significantly depending on the product and reaction system. For instance, most commercial-scale bioreactors for cell culture typically range from 1,000 to 3,000 L, while reactors for large-scale microbial fermentation can reach up to 5,000 L even at the pilot scale.

Bioengineering AG offers laboratory-scale reactors (2–20 L), pilot-scale reactors (30–300 L), and production-scale reactors ranging from 300 L to 300 m³, providing corresponding equipment for every stage from experimental research to industrialization, as well as the documentation required for GMP and FDA validation.

In the laboratory sector, Bioengineering AG offers products such as the L1523 series of in-situ sterilizable laboratory fermenters, the NLF series of mobile in-situ sterilizable laboratory fermenters, the RALF series of glass fermenters for off-site autoclave sterilization, and the KLF series of small-scale in-situ sterilizable fermenters, all of which are suitable for bacterial and cell culture.

The vessel is available in two configurations: all-316L stainless steel and a Duran glass/stainless steel combination, with total volumes ranging from 5.5 to 19 L. Functions such as temperature control, pH, dissolved oxygen, and antifoam/level control are fully integrated for linked regulation. The system includes three feed pumps (quantity adjustable) along with standardized feed bottles and connectors. It also features pre-configured digital and analog input/output interfaces that require no setup, enabling connection to external devices such as balances and turbidity sensors. Furthermore, the equipment supports upgradable modules, including a magnetic stirring system, rotating filter, balance, glucose detection system, methanol detection system, turbidity detection system, and off-gas analysis system.

Featuring a unique caster-based design, the unit can be easily and flexibly moved to any corner of the laboratory. Both the vessel body and lid are constructed from 316L stainless steel, with a total volume ranging from 16 to 30 L. The basic configuration parameters, expandable functions, and optional features are similar to those of the L1523 SIP (Sterilization-in-Place) laboratory fermenter.

In addition to the standard jacketed water bath circulation temperature control system for the vessel body, this equipment also features Bioengineering’s distinctive hollow baffle temperature control system. By circulating temperature-controlled water through the hollow stirring baffles, it provides superior temperature control performance compared to jacket conduction. It is available in four volume specifications: 6.7 L, 5 L, 3.7 L, and 2 L. The basic configuration parameters, extended functions, and optional add-ons are similar to those of the two aforementioned models.

Suitable for initial-scale studies during the experimental phase, this system is available in three volume specifications: 3.7 L, 3.1 L, and 2.4 L. The equipment features an industry-exclusive sterilization-in-place (SIP) process for small glass vessels, meeting high requirements for operational convenience. Its basic configuration parameters, expandable functions, and optional add-ons are similar to those of the two aforementioned models; the only difference is that this unit is equipped with four feed pumps (the quantity can be adjusted as needed), along with standardized feed bottles and connectors.

In the areas of pilot-scale and large-scale production, Bioengineering AG also offers several products, including the LP351 sterilizable-in-place (SIP) pilot reactor and the P-series sterilizable-in-place (SIP) production reactor.

Large-scale production bioreactors, suitable for use as final production vessels or intermediate vessels at various scale-up stages. The automation level of the entire system can be fully customized to user requirements. With a total volume of 100 L and above, in addition to integrated control functions such as temperature, pH, dissolved oxygen, and antifoam/level control, the equipment features customized feed pumps, feed bottles, and connectors; a highly customized BIO SCADA control system; and pre-configured digital and analog input/output interfaces (no setup required) for connecting external devices (e.g., balances, turbidity meters). Expandable functions and optional upgrades include an upgradable magnetic stirring system, rotating filters, balances, glucose detection systems, methanol detection systems, turbidity detection systems, and off-gas analysis systems.

This equipment can serve not only as a scale-up vessel for further experimentation in general laboratories but also as an auxiliary tank for large-scale production systems or as an intermediate vessel for scaled-up production. It is available in three volume specifications: 42 L, 50 L, and 75 L. Its basic functional parameters, extended features, and optional add-ons are consistent with those of the P-type sterilizable-in-place (SIP) production bioreactor. However, its feeding system is not customized; instead, it comprises three feeding pumps (the quantity of which can be adjusted), along with standardized feeding bottles and connectors.

In addition to Bioengineering AG, major imported bioreactor brands include Sartorius, B. Braun Biotech International, Applikon Biotechnology, Infors AG, Marubishi Machinery, Applikon, and NBS (acquired by Eppendorf).

In China, companies such as Tofflon, Truking Technology, Donning Biotech, Lepu Biopharma, and Jinyi Shengshi are also actively expanding their footprints and experiencing rapid growth.

Literature indicates that the global bioreactor industry encompasses 315 key core technologies. The United States ranks first worldwide, holding 38.73% of the patents for these key core technologies. China follows closely behind, accounting for 26.98% of such patents, demonstrating that its domestic capabilities in the bioreactor field are considerable. Other countries, including Germany, South Korea, Japan, and the United Kingdom, also possess a certain level of competitiveness within the bioreactor industry.

In fact, China had already begun to prioritize upstream equipment for biomanufacturing before the United States imposed restrictions. In January 2022, the “14th Five-Year Plan for the Development of the Pharmaceutical Industry,” jointly issued by nine national ministries and commissions, listed “the focused development of ultra-large-scale (≥10,000 liters per tank) cell culture technology” as the top priority in technological breakthroughs for biological drugs.

The domestic bioreactor industry has rapidly gained attention from the capital market since 2022. Many companies completed multiple rounds of financing between 2021 and 2024, enabling them to expand production capacity and increase R&D investment. According to incomplete statistics from Artery Orange Data, nearly 70% of the financing in this field was completed within three years. Additionally, an article by VCBeat shows that the domestic substitution rate for single-use bioreactors is currently at least 50%, and even reaches 60%–70%.

In fact, China’s biopharmaceutical industry has undergone a period of development. Influenced by the dynamically evolving international landscape and driven by downstream enterprises’ urgent need to reduce costs and improve efficiency, many Chinese pharmaceutical companies have shifted from initially accepting domestically produced equipment out of necessity to proactively embracing it.In the past few years, the focus was on domestic products “replacing” imports; in the near future, we will likely see—or are already seeing—domestic products “surpassing” imports.

References:

1. Biochemical Engineering, "Research Progress of Bioreactors in the Biopharmaceutical Industry"

2. Studies in the Science of Science,《Identification of Key Core Technologies for Bioreactors and Research on Cross-Country Gaps》