EPM speaks to a number of key players in contract manufacturing to get their thoughts on the sector’s changing landscape.
Roundtable
Featuring:
Mark Quick, executive vice president – corporate development, Recipharm Bobby Sheng, CEO, Bora Pharmaceuticals Manuel Leal, director of business development, Idifarma Vincent Dunne, CEO, The Wasdell Group Tom Wilson, VP, global contract manufacturing leader, Pfizer CentreOne Andrew Henderson, sales and marketing director, Sterling Pharma Solutions
The CMO market has been predicted a CAGR of over 7.75% between 2019 and 2024, what do you attribute the anticipated trajectory to? Why are companies outsourcing more of their manufacturing requirements?
Quick: There are a number of reasons why outsourcing is a popular option. Put simply, it allows drug developers to access expertise and capabilities they may not possess in-house, as well as generating time and cost efficiencies in many cases. For example, many big pharma companies have divested their manufacturing facilities often to CDMOs, particularly those using more traditional technologies, and have turned to outsourcing their manufacturing. This allows them to focus on R&D and developing the next round of pharmaceutical innovations. In addition, as drugs become more complex, the need for specialist skills is increasing and outsourcing is a good option to access these.
With this forecasted growth, where you do see investments needing to be made in the future? And do you have any in the pipeline?
Leal: The demand for contract manufacturing of highly specialised drugs for cancer and other treatments. As such drugs require niche and complex skills to develop and manufacture, the outsourcing industry has thrived as companies looks to partner with specialists for their product.
We identified that around 40% of all new chemical entities (NCEs) have low solubility. At Idifarma believed it was a necessity to have a strategy for improving poor bioavailability, hence why we invested in GMP spray drying capabilities to support the development of these drug products.
Consolidation has been a hot topic in the contract service market, how has it impacted your organisation? Do you think it’s affecting market competition?
Sheng: Our industry is a relatively small community, so with each acquisition there is a lot of shuffling of resources, humans and capital. This makes it an interesting time for CMOs and encourages growth and change. I think it’s healthy for CMOs and the industry benefits as a whole, as it forces companies to be more competitive in their offerings when other CMOs are scaling up and pooling resources with every M&A.
However, I believe quality, customer service and reliability will prevail for a company’s overall competitive value. Alongside technical capability, these factors are at the forefront of considerations as they will always be critical to the success of their product or project. There is always a risk that the larger an organization becomes, the more siloed and inefficient it will be, which ultimately impacts the quality and speed of product delivery.
How are CMOs offering added value to the market in 2019?
Wilson: CMOs should serve as reliable partners for their customers, offering expertise that is not available in-house to guide a drug securely and efficiently from development to commercial manufacture. There are many challenges faced during drug development, including scaling up and optimizing processes for commercial volumes. CMOs with both small and large scale capabilities are well equipped to guide their customers.
In addition, as the regulatory landscape becomes more complex, CMOs with a global reach can help biopharma companies navigate the requirements and achieve compliance. It is Pfizer CentreOne’s belief that many minds are better than one. Collaboration and knowledge sharing in a successful CMO-sponsor relationship can add significant value to a drug development project.
Does the CMO market differ from region to region, or are we seeing these trends on a global scale?
Dunne: Trends within the CMO market are fairly similar on a global scale, with outsourcing needs increasing on an annual basis. However, there are some regional differences, for example in Europe companies need to choose an outsourcing partner who is well equipped for navigating the specific regulatory landscape and requirements of each country.
Choosing an outsourced partner who is not only focused on product delivery, but on market access and distribution allows for seamless product and market entry, supporting ongoing commercialisation requirements.
Do you think CMOs are risk-averse or pushing innovation in the pharma supply chain?
Henderson: We launched our Technology and Innovation Programme over 4 years ago designed to allow us to explore new and emerging technologies that could benefit the pharmaceutical supply chain. By working with our partners at local universities we are able to access the viability and commercial potential of some of these new technologies with the ultimate goal of developing these into solutions for our customers. At Sterling we’re committed to continuous progression so we can provide the best service for our customers and their products.
How are contract manufacturers preparing for niche drug pipeline? How will the move from large scale manufacturing affect the CMO landscape?
Leal: As the industry becomes more focused on such complex treatments and smaller-patient populations, specialisation amongst the CMO market will become more important as each organisation looks to differentiate itself and demonstrate its expertise.
The industry is also continuing to consolidate and bring a vast range of niche requirements under one roof. However, despite this trend, smaller independent CDMOs will be better placed to support on these highly-complex projects, as they have been built on agile manufacturing methods that are prepared to handle smaller-volumes and the nuances that come with that.
Idifarma is an example of this, as our focus is to manufacture niche and highly potent products and we have specifically designed our facilities to do this.