Read the Conversation
Meeting highlights:
- Jan Kengelbach’s Mission: Lead the company into a new era of growth, the strategic importance and impact of the acquisition by Kühne Holding AG.
- Aenova Group's Growth Strategy: Focused on expanding its CDMO services across Europe, offering technologies in the market that differentiate it from other competitors, and investing heavily in innovation.
- Industry Trends: Jan Kengelbach highlights key trends in the pharmaceutical sector, including the increasing demand for high-quality and cost-effective CDMO services and innovation in drug formulations.
- Challenges and Opportunities: The industry faces regulatory requirements, supply chain disruptions, and competitive challenges, but the company sees opportunities in digitalization, automation, and new market expansion.
- Investment in Technology: Aenova Group is investing in advanced manufacturing technologies, innovative platforms, and digital transformation to enhance efficiency and meet evolving customer needs.
- Company Culture: Aenova’s values center on excellence and a patient-first mindset, supported by the Aenova Academy to foster continuous learning and skill development.
EF: What are Aenova Group's key priorities and main opportunities in Germany for 2025 amid global changes and a new government?
JK: Our strategy is fully customer-centric, keeping clients—and the patients they serve—at the heart of everything we do. As a service company, our goal is to provide the best service in Europe while investing in cutting-edge technologies that set us apart and drive innovation. This year, we are investing 120 to 130 million Euros to expand our facilities across 14 locations, seven of which are in Germany. This will increase production capacity and support new technologies, enabling us to serve customers better and improve patient care.
Key initiatives include a new aseptic center in Italy for prefilled syringes, a spray drying platform in Ireland, a hot melt extrusion platform in Germany, and a gummy production platform in Romania for over-the-counter drugs, as well as vitamins and supplements. Leveraging deep expertise across diverse dosage forms and markets, we continuously innovate and advance our technological capabilities to stay ahead in the industry.
EF: How has Aenova's transition from venture capital to private ownership influenced its strategy and direction?
JK: Shifting from private equity to family ownership is uncommon but beneficial for us. Private equity firms usually operate on a four-to-six-year investment cycle, while many of our decisions only start generating significant returns after that period. The advantage of our new ownership is its focus on long-term investment, providing stability for our business. Our new owners, Kuehne Holding AG, have no immediate plans to sell and a long-standing track record of building enduring businesses—its main business, Kuehne and Nagel, founded 130 years ago, is still under its ownership today. With Kuehne’s financial strength behind us, it will be easier to act more decisively in the market and potentially finance future inorganic growth.
EF: How is Aenova adapting to global competition and emerging trends like personalized medicine and cell therapies?
JK: Measuring progress can be tricky, but one way to look at it is through business growth. When I started at Aenova eight years ago, we were securing around €60–70 million in new business annually. Last year, that number jumped to €210 million, despite operating in predominantly high-cost European countries.
A key factor in staying competitive is our ability to control costs. In many of our plants, once you factor in transport risks and retesting, our conversion costs are actually lower than those of Indian competitors. That is no coincidence — it is the result of deliberate investments in automation and next-generation machinery. Take blister packaging, for example. Where 100–150 blisters per minute were once considered efficient, our latest machines now run up to 700 blisters per minute. At this scale, labor costs become far less critical, making us highly competitive.
However, cost efficiency is not enough on its own. Reliability — delivering on time and at top quality — is even more important. Not every CDMO has kept pace here. Investing in advanced technology requires financial strength and access to capital.
This wasn’t always our reality. A few years ago, we reinvested 4–5% of our revenue; today, that's grown to 12–13%. That level of reinvestment is only possible with strong profitability and shareholders willing to support long-term growth over short-term gains. It is this strategy that allows us to stay ahead.
EF: How do you envision Aenova's long-term investments, and how will they shape operations over the next years?
JK: We started implementing this strategy even before our current ownership. Back then, with BC Partners as our shareholder, there was already a strong belief in its value potential. Being family-owned now may give us more flexibility for long-term investments, but every investment still requires a solid business case. Everything we invest is self-funded by the business’s operating profits, and if we need to make bigger investments, such as acquisitions, we can use our healthy balance sheet to do so.
Looking at the market, big pharma companies are investing billions in manufacturing. Setting up a single aseptic production line today can cost €30 to €50 million — often an entire annual capex budget of smaller CDMOs. That limits many companies to adding one new line every few years while maintaining existing operations.
What differentiates us is our ability to invest strategically in new technology, often with pre-sold capacity or co-investment agreements with customers. This enables us to keep expanding in Europe, especially in high-tech, highly automated manufacturing. Of course, not all production makes sense to keep in Europe. For generic OTC (“over the counter”) drugs like paracetamol or ibuprofen India remains the most competitive location. But for prescription and more complex medications, there is still a strong case for European production. With the right automation, efficiency, and technology, we can compete, as we do have the capital and expertise to do it right.
EF: How is Aenova integrating AI technology into its platforms, and what opportunities do you see for further innovation in the sector?
JK: When I first took over Aenova in 2017, the company mainly focused on manufacturing established products rather than developing new technologies or innovations. Over the past few years, we have made significant progress in changing, for example, by introducing our program, "Aenovation™". The Aenovation™ program is designed to streamline pharmaceutical development, deploying a science-based rationale selection of formulation and technology. Computational analysis and algorithms play a key role in this process. This initiative aims to bring new products and development services to the market, focusing on advanced technologies like spray drying and hot melt extrusion. Without heavily marketing these services until now, we have already attracted strong market interest — many companies need certified platforms to bring their products to market. As a result, we are now working with several new chemical entities (NCEs) that could become major commercial products.
This brings us to technology and digitization, which are central to our long-term strategy. In certain areas of production, we are using data-driven process optimisation, which enables us to exploit a significant amount of potential.
In a major Group-wide project, we are upgrading all major operating systems — rolling out SAP as our new ERP, Veeva for quality management, a new CRM system, and piloting electronic batch recording. The goal is simple: bring our systems to world-class standards and make Aenova the top pharmaceutical manufacturing partner in Europe. While our current systems work, we want to elevate performance and efficiency across the board.
Digitization also offers huge potential in regulatory compliance and documentation, traditionally areas with heavy manual workloads. In many manufacturing sites, more indirect employees manage paperwork and compliance than direct workers on the machines. But AI and digital tools can change that. Automated systems can now handle batch records and product quality reviews just as effectively as manual checks. We are not fully there yet, but we are laying the groundwork, ensuring data is structured properly and eliminating manual entry wherever possible.
Today, we already use digital tools in the back office, for instance, for contract reviews and compliance checks. The real breakthrough will come when we integrate these solutions directly into production workflows, reducing manual processes and boosting efficiency, especially in middle and back-office operations. Building this digital infrastructure is our current focus — expanding its capabilities will be our next big step.
EF: Could you elaborate on your company's sustainability strategy and its impact on environmental health?
JK: When a company reaches a billion euros in revenue, it has to take its role as a responsible corporate citizen very seriously. Ideally, that starts earlier, but with 4,000 employees and a large manufacturing footprint, it becomes essential. And that commitment has to come from leadership.
We're preparing to launch our official sustainability policy later this year, with clear targets for reducing scope 1 and 2 emissions. A key priority is switching to 100% renewable electricity, along with lowering wastewater and overall energy consumption. We've created a dedicated sustainability department that works plant by plant to set reduction goals.
Investments in sustainability may not offer the same quick return as new machinery, but they pay off over time. That's why you will already see solar panels on roofs and other areas at many of our sites. And more are being installed every few months. Solar currently provides a smaller but steadily increasing share of our energy, because every bit counts. If all companies made small reductions, the collective impact would be huge.
But sustainability goes beyond environmental goals. It is about good governance and community engagement, too. These factors make us more attractive not just to investors, but to employees who want to work for a company that's genuinely improving. A recent example: we've moved our entire corporate vehicle fleet to electric-only. Small steps like these add up and are helping us become a more sustainable, responsible company.
And, of course, we are participants in the UN Global Compact, the world's largest corporate social responsibility network.
EF: What strategies is Aenova implementing to attract and retain highly specialized talent amid ongoing innovation in the manufacturing sector?
JK: We started by asking ourselves a simple but fundamental question: how do you build a strong company culture? This was particularly challenging at Aenova, a company shaped by multiple mergers with little shared identity beyond being in the same industry.
Our journey began with defining core values. First, putting customers and patients first — because we are all patients at some point. Second, recognizing that everyone matters — every employee plays an essential role. And third, driving performance — striving for excellence in everything we do, especially in a highly regulated industry.
But values only matter if they are put into action. We integrated them into daily operations, from including them in monthly reports to introducing annual feedback and performance reviews for all 4,000 employees. We also launched the Aenova Academy, offering training on everything from leadership and stress management to language skills — with 1,500 courses attended to date.
Leadership development has been another big focus, with dedicated training for our 250 managers on how to lead effectively and support their teams.
We track progress through our Employee Net Promoter Score (NPS), which has improved by 10% in just one year. Our absenteeism rate is just 6% — dropping to 5% in good months — a figure many German companies would envy.
Ultimately, Aenova's culture is about balance: recognizing and valuing employees while expecting active participation and high performance. The result? A strong reputation that helps us attract top talent, creating a virtuous cycle of success that feeds further success.
EF: What attracted you to leading Aenova, and how has your experience influenced your approach to navigating its evolution and acquisitions?
JK: When I first joined Aenova, it was only supposed to be a short-term role. But weeks turned into months, then years, and I've recently signed on for a few more. The simple reason is that I genuinely enjoy what I do.
When I took over, Aenova was struggling financially, underperforming, operationally weak, and not winning much new business. My background is in restructuring, and I specialize in fixing, rebuilding, and improving companies.
What convinced me to stay is the enormous potential in the pharmaceutical industry. Unlike many other sectors, almost every major trend works in our favor — growing demand, manageable competition, and long product life cycles. The industry's high barriers to entry and profit potential add to the appeal.
What also stood out was the absence of a clear market leader in contract manufacturing in Europe. No one company truly dominated. That is when I realized the opportunity: to transform Aenova from an average-performing CMO into a top-tier CDMO — one known not just for products but for technological expertise and operational excellence. That's the journey that keeps me motivated.
EF: As a final message, what must happen to ensure health is seen not as a cost but as a long-term investment at the European level?
JK: COVID-19 reminded everyone just how critical our industry is — and yet, Europe still faces persistent drug shortages, especially in generics. These aren't just due to supply chain issues in India or China; the bigger problem is that many products, especially older generics like antibiotics, have become commercially unsustainable.
For years, drug prices have remained flat or even declined, while manufacturing costs — driven by inflation, energy prices, and regulatory demands — have surged 20%, 30%, and sometimes even 40%. That math simply does not work. Many manufacturers are exiting certain product categories, not because they want to, but because they have to.
In addition to Europe's highly complex regulatory environment, it becomes clear why production is not easily "reshoring" back to Europe despite political ambition. Environmental regulations, for example, while well-intentioned, can make local production economically unviable.
The key going forward is for policymakers and investors to recognize that pharmaceutical manufacturing is not just a cost but a strategic investment in Europe's health security. This sector has strong long-term fundamentals but requires continuous investment, regulatory flexibility, and a pricing environment that ensures profitability. If that balance is found, Europe can secure its supply of essential medicines while still fostering innovation and growth.
