DEMO, founded in 1965, is a mainstay of Greek pharma and one of its largest companies, accounting for 25 percent of the total investment across the entire Greek pharmaceutical sector. Throughout its long history DEMO has shifted its focus, moved towards exports and weathered Greece’s financial crisis. Today, the family-owned company is once more opening a new chapter in its story as it looks to cement Greece’s position as an essential medicine and ingredient manufacturing hub for Southeastern Europe.
Focusing on Injectable Generics and Exports
Throughout its over 50-year existence, DEMO has often made radical decisions. In 1997 the company decided to focus solely on the production of injectable generics, a niche market that represents no more than six percent of the total pharma market. “It is a price-sensitive/volume-based market and in order to be competitive in this tender-based business, economies of scale are crucial,” says CEO Dimitris Demos.
DEMO’s next big decision was to concentrate on exports. “In a relatively small country like Greece, a Greek company must grow at an international level in order to succeed, so, in 1999 DEMO decided to become heavily involved in exporting,” Demos confirms.
Moreover, the firm chose to focus on R&D, securing several product format breakthroughs including blow fill seal (BFS) ampoules. On the back of these advances, DEMO began to introduce more products using plastic rather than glass containers, and manufacturing BFS technology. In 1999, the company established a new R&D centre, the largest in Greece, and set the strategic goal of developing seven new products per year.
Riding out the Financial Crisis
Although a large part of DEMO’s turnover comes from outside the country, the company felt the impact of the Greek financial crisis. “The Greek financial crisis hit DEMO hard, as it did all Greek firms, even though, by 2011, 40 percent of our turnover was coming from outside the country. The Greek public hospitals’ payment delays for three years created a huge accounts receivable issue,” states Demos.
DEMO continued developing seven products per year throughout the crisis period. This meant that by 2019, when the crisis was over, the company had a much bigger product portfolio despite lacking at the time the capacity to produce it at full scale
Dimitris Demos, CEO
Instead of collapsing under the pressure of the crisis, DEMO again made a tough call and decided to continue its development and expansion. “DEMO continued developing seven products per year throughout the crisis period. This meant that by 2019, when the crisis was over, the company had a much bigger product portfolio despite lacking at the time the capacity to produce it at full scale. DEMO also continued its international expansion during this period, growing its presence from 40 countries back in 2011 to 85 by 2019,” Demos confirms.
DEMO continues to expand its product portfolio and seen the strategy pay off. “Our revenues now have started reflecting this expanded portfolio, jumping from about EUR 134 million in 2019 to 230 million today,” says Demos.
Next Big Steps: APIs and Building European Manufacturing Capacity
Greece can play a very important role and become a hub of pharmaceutical manufacturing in Europe thanks to our strong local manufacturing industry
A decisive moment came for DEMO in 2019, when the company chose to begin manufacturing its own active pharmaceutical ingredients (API). In light of post-COVID discussions about nearshoring of essential medicine and API supply chains in Europe, this decision proved more than timely. “The strategic decision to manufacture our own APIs was taken in 2019, prior to COVID. This decision has since been proven to be correct by COVID and the subsequent shortages in Europe. Truthfully, many larger companies looked at us in disbelief for moving into this field and attempting to compete with Indian and Chinese competitors on price, but API manufacturing is now becoming one of our most crucial business units,” Demos confirms.
DEMO is among the European pharma companies that operate manufacturing plants on European soil and Demos sees Greece, along with Italy and Spain, becoming hubs for European pharma manufacturing and consequently helping to safeguard the resilience and stability of the EU’s pharmaceutical supply chain. “It is the perfect time for Southern Europe, not only Greece, to play an important role in safeguarding the resilience and stability of the EU in terms of pharmaceuticals,” he says.
“Greece can play a very important role and become a hub of pharmaceutical manufacturing in Europe thanks to our strong local manufacturing industry,” Demos continues.
To further ramp up production capabilities, the firm has already created a new manufacturing campus in the industrial zone of Tripoli, 120 km from Athens. In addition, the EU Recovery and Resilience Facility (RRF), Demos believes, will have a positive impact on its manufacturing capacity and in so doing build Europe’s manufacturing horsepower. “The money that Greece stands to receive post-COVID from the EU Recovery and Resilience Facility (RRF) is also influencing our investment plan, because DEMO is receiving long-term funding, contributing to the added-value development of Greece’s and Europe’s manufacturing sector,” he says.
In DEMO’s risk-taking spirit, the company’s latest big move has been to embark on the area of biologics and biosimilars, building a new facility that will also cover the production of monoclonal antibodies, to be finalised by the end of 2023.
“It is a big step, but we must make up for what we lost during the crisis years, including expanding our capabilities into new pharmaceutical forms. Post-2023, most of the value in the hospital sector will come from biologics, meaning that we cannot remain focused on commodity products alone. DEMO fully understands the need for big pockets and heavy investment, as well as the fact that we will need to wait for eight to ten years to see the first revenues. But we consider it a duty to pursue biosimilar success, given our status as a leading injectable manufacturer for the hospital sector,” says Demos.