Sunday 19 November 2023

The Booming Biopharmaceuticals: How Contract Companies Respond


In response to our industry's large carbon footprint1, an increasing number of organizations have made maximizing sustainability a top priority for their operations. Encouraged by efforts such as the EU's "Green Deal," many businesses are actively embracing an environmental conscience and exploring innovative methods to reconcile economic performance, social responsibility, and environmental effect.


By Richard Parkersic


As the volume and ambition of these commitments expand, supply chain partners will see this trend mirrored in RFPs. Biopharmaceutical businesses are increasingly looking for collaborations that help them achieve both their commercial and sustainability goals, whether it's through eco-friendly package design, carbon-neutral production facilities, or less resource-intensive operations.


This tendency will be especially important for manufacturers. CDMOs will not only need to figure out how to successfully map new client needs.




Biopharma, which has long been a technology behind, has now begun a delayed, pandemic-fueled digitalization sprint. Countless organizations have rushed in the last two years to virtualize their workforce, move their teamwork to the cloud, and use technology to keep their operations operating while keeping their people safe.


Service providers are no exception, and they show no indications of slowing down their fast digitization. AI and machine learning-powered industrial solutions are gaining traction, with automation and robots driving considerable improvements in supply chain productivity. Expect further investment in devices like these while pandemic concern persists.


Strategic Partnerships

Another long-standing impediment is the ever-increasing expense of bringing new medications to market. Biopharma businesses will continue to strive to reduce the "total cost of ownership" involved with developing, producing, and commercializing their medications this year. This will result in a greater emphasis on not just the function but also the value of outsourced collaborations.



As astute service providers have realized, biopharma businesses seek third-party specialists who do more than fill a skill gap or allow an in-house team to focus on key skills. Customers are increasingly searching for suppliers that can provide a strategic, value-added combination of specialized services, customized solutions, and efficient operations throughout as much of the value chain as feasible.


In response, CDMOs aggressively seek new collaborations, particularly between producers with complementary expertise or complementary skill sets. Several high-profile CDMO partnerships have lately formed, with the purpose of synchronizing knowledge in ways that reduce time-to-market, expedite technical advancements, and provide considerable long-term value to consumers.


Integrated Services

One significant trend we notice is that pharma innovators are increasingly collaborating on an integrated basis with their CDMO. Initially, CDMOs were largely focused on early-stage development, assisting customers in obtaining an investigational new drug (IND) application. Integrated CDMOs, such as Piramal Pharma Solutions (PPS), now help firms across the whole development process, including late stage and commercial programmes.



This trend is being driven by a number of causes. Integration offers intrinsic advantages in terms of market speed and cost efficiency. It is easier to transfer technology within a single organization. Similarly, many project parts can be managed by a single, key point of contact for project management. Supply chain integration, with synchronized material, provides further benefits.


The Supply Chain and the Pandemic


Everyone has seen how the epidemic has disrupted global supply chains over the last two years. The pharmaceutical supply chain is especially complicated—possibly the most complex of any sector. Specialization is a big element; our supply chain is extensive, worldwide, and includes high-demand minerals. There is a global movement towards rethinking the global supply chain, which includes reshoring, increasing supplier redundancy, rethinking logistics, and upgrading systems and procedures to guarantee that supplies are easily accessible.




PPS tackled the issue head-on through its supply chain risk mitigation team. They tried to categorize and prioritize the raw materials we use, categorizing them according to whether they were utilized in novel or commercial goods and rating them according to particular risk factors. The risk criteria included information such as a product's commercial potential, manufacturing location, whether it was sourced from a single source, present availability, dependency on China, and procurement value. The team suggested unique risk mitigation techniques based on the scope and type of the dangers associated with a raw material in order to achieve rapid, efficient, effective, and long-term outcomes.


Supplying Advanced Therapeutics Demand

Because of the rapid rise of new modalities like cell and gene therapy, many corporations are foregoing costly efforts to establish internal production capabilities. Instead, they are looking for partners that can supply the advanced manufacturing practices, technical expertise, and technology required across all modalities to get medicines closer to commercialization.


In these sectors, innovation and knowledge have grown rapidly, and there is an urgent demand for development and production partners that can solve obstacles quickly. These issues include scaling up robust processes, optimizing analytical techniques, increasing yields, and integrating upstream and downstream processing with raw material supply chains to boost efficiency.


CDMOs are also an important element of the manufacturing supply chain for new medicines, therefore they must guarantee that sufficient capacity is available to innovators to fulfill demand. As a result, researchers are being forced to seek out collaborative partners early in the development process to guarantee capacity is accessible when needed.


Model of Virtual Pharma Business

Smaller biotechs, defined as firms with revenues of less than $250 million or listed companies with a market valuation of less than $2.5 billion, are driving much of the innovation in biopharma pipelines. There are over 5,500 of these businesses, and we anticipate that by 2026, they will contribute more than 60% of biopharma growth while having little or no in-house scale-up capabilities. These companies are looking to partner with CDMOs through a "virtual pharmaceutical" business model that allows them to simplify and accelerate development, hit milestones, and retain ownership without investing significant capital in infrastructure.


These smaller businesses frequently have insufficient in-house resources to maintain CDMO relationships.


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