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Pharma Tech Outlook | Friday, June 14, 2024
Biological drugs and new therapy classes are more likely to be outsourced because of the specialised techniques and equipment they require, which one-stop shops can offer.
FREMONT, CA: The biotech industry became prominent during the pandemic, a challenging time for the world. The industry had active pharmaceutical ingredients (API) to begin but needed formulation, chemistry, and device to prepare for a clinical trial application. Rather than starting the costly and lengthy process of finding lab space, buying the right equipment, and assembling in-house teams, a drug-device combination product was developed using contract research organisations (CROs) up to a clinical trial application.
The contract development and manufacturing organisations are the pharma industry’s special forces units, highly specialised teams that function behind the scenes, doing difficult tasks in high-pressure environments. Earlier, drug development was often carried out directly by pharma companies that commanded in-house teams of many scientists, which was later changed. Most top pharma firms had molecular biology divisions internally, and in the last two decades, those divisions disappeared. This was entirely outsourced, especially in Asia, because of the prices.
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Several companies are steadily increasing their global footprint worldwide. Some recently added a new drug product manufacturing facility, while others focused on formulation development and manufacturing for oral solid and injectable drugs.
Pharma companies have shifted the corner regarding their appetite to outsource development. The scale and scope of outsourcing have changed dramatically. Instead of one-off project transactions, there is a mode of long-term strategic partnerships between the contractors and their clients. In the biotech sector specifically, CDMOs are often seamlessly integrated with in-house development and manufacturing departments. Several small and virtual pharmaceutical companies with a few employees cannot exist without CDMOs.
There is a traditional division between contract research and manufacturing organisations, or CROs and CMOs. The former assists pharmaceutical firms in their drug discovery and clinical research efforts, while the latter provides activities focused on manufacturing both active pharmaceutical ingredients and entire drug products, sometimes even including packaging. However, over the last few years, there has been a significant rise in organisations aiming to be one-stop shops for anything from early-stage research to manufacturing. The development and manufacturing combination is valuable even to big pharma companies as it considerably reduces the tech transfer and scale-up risk.
The pandemic caused a turning point in the relationship between CDMOs and pharma companies. Before COVID-19, pharma organisations outsourced services on a project-by-project basis, and long-term collaborations were rare. At the onset of the pandemic, CDMOs rapidly became a huge additional research source and manufacturing capacity. However, it is still unclear if this will translate to more strategic partnerships in the long run.
The relationship is more integrated and broader with increasing research, development, and manufacturing organisations that CRDMO uses. Collaborations have evolved from transactional to strategic, requiring CRDMOs to have developed technologies, manufacturing capacities, proven quality systems, and experience and expertise.
Big pharma companies often work with a different contractor for each drug life cycle step, and smaller firms prefer to partner with a CRDMO offering a wider research and manufacturing services array. This abates the burden of managing a complex set of partners for every individual step. Speed and competency are the two primary factors in making decisions around outsourcing. CROs and CDMOs help to look globally for the precise competencies that companies require, which is difficult for small companies.
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