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Pharma Tech Outlook | Friday, December 17, 2021
Pharma businesses use outsourcing to improve operating efficiencies, extend geographical presence, and strengthen therapeutic knowledge.
Fremont, CA: Outsourcing in biomanufacturing has been steadily increasing for a long time. There have been few signs of a big downturn in the last two years. This is due in part to COVID-19. More than half of the biopharma industry plans to boost outsourcing in the future to manage supply chain concerns.
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Small businesses continue to be important sources of innovation, and many have active product development pipelines. Because many smaller businesses lack manufacturing capabilities and don't intend to acquire them, they rely on the technical expertise of contract manufacturing organizations (CMOs) to assist them in getting their goods to clinical trials and, eventually, commercial manufacturing operations. Larger, more established organizations will continue to look for partners to outsource their existing goods, freeing up internal capacity for new, incoming products in their pipelines.
Increase in biopharma outsourcing
While all manufacturing categories reported record or near-record levels of outsourced and expected outsourced activity, planned offshoring for all areas increased significantly in 2021. One example is process development, where 64.4 percent of developer respondents estimate outsourcing, up from 34.9 percent in 2020 and the second-highest amount ever recorded in this category since data collection began.
Another area where biopharma businesses indicate a substantial increase in planned offshore in the next five years is "biomanufacturing operations," which has 69.3 percent of respondents, up from 34.9 percent in 2020 and the highest recorded amount in this sector since data collection began. All of the other areas where offshore trends were monitored revealed record levels of predicted offshoring. Offshoring remains a popular choice for enterprises trying to expand their reach beyond their native markets and those seeking second-source manufacturing methods.
Offshoring is still seen as a cost-cutting strategy. Other advantages, which are not generally associated with multinational CMOs, are also significant to companies considering outsourcing their manufacture. These benefits can be more difficult to quantify than cost savings. Offshoring is becoming more associated with quality and reliability, as well as regulatory competence, among emerging market CMOs.
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