A wolf stands at the door of the biopharmaceutical industry. Over the next few years, the industry will be hard pressed to meet demand for promising new protein-based therapeutics that are now emerging from the laboratories. Manufacturing shortfalls in physical capacity and talent could spell lost revenues for companies through the middle of the decade.

Among the most promising of the new drugs filling the pipelines of pharmaceutical and biotechnology companies are compounds produced by live, genetically modified microbial or animal cells. Over the next five years, the revenues generated by protein-based therapeutics are set to grow at 15 percent a year, about twice the rate of the rest of the pharmaceutical industry. Much of the demand is driven by monoclonal antibodies, a powerful class of therapeutic proteins that must be administered in extremely high doses and can currently be produced only in mammalian cell-culture facilities. Yet the current worldwide cell-culture capacity of 450,000 liters is almost fully utilized. Meanwhile, more than 200 drugs derived from mammalian cell cultures are in clinical trials, and about 70 of those drugs are expected to come to market by 2006. Producers—biopharmaceutical companies and contract manufacturers alike—are now tripling their production capacity, but new...