Outsourcing

What should pharmaceutical companies make of recent corporate developments at several high-profile service providers?

… the real glue that holds the partnership - and project - together, even more so than a formal contract or quality agreement, is the ability to communicate regularly and honestly with each other.

A big problem for the industry seems to be that Phase II has become something of a 'black hole' for drug development; new drug candidates can't seem to escape once they enter.

Beyond the inevitable debate over profit margins, the increasing range and effectiveness of modern medicine leave us with one core issue: the high price of success.

Big Pharma is ramping up capital spending in parenteral manufacturing at the same time that contract manufacturers are completing their own major investment programs.

Early development services continue to be a sweet spot for contract R&D services. The big question is how soon the impact of early-development candidates will be felt in late development and commercialization.

The contract services industry is fertile ground for the investment banking community this summer.

Data from the 2004 Outsourcing Survey indicate that pharmaceutical companies are spending more on outsourced drug development, but with fewer suppliers.

Corporate profile

Despite investors' strong interest in the chemical industry overall, pharmaceutical chemical businesses have not experienced much attention from investors thus far.

It's not clear whether contract service providers can deliver the performance improvements and costs savings that drug companies expect from large, long-term, semi-exclusive contracts.

Sponsors who have been lax in performing financial due diligence on their contractors have been given a wake-up call by the recent developments at aaiPharma.

Recent events in the pharmaceutical outsourcing industry highlight the importance of ongoing attention to contractors' financial situations and their strategic intent.

As outsourcing services become a more integral part of pharmaceutical processes, drug companies are taking a harder line on consequential.

The changing fundamentals of the industry are causing Big Pharma to focus more on operating efficiency instead of just product performance.

As manufacturers move to manufacture to demand rather than to forecast, the traditional wholesaling business model is being transformed.

Exhibitors at October's AAPS meeting confirmed that the demand for services is robust and believe that the industry's pipeline appears stronger than it has been in the past few years.

As FDA tries to bring pharmaceutical manufacturing into the 21st century, competitive dynamics in contract manufacturing are likely to change in favor of companies that have greater manufacturing expertise and the means to invest in new technologies.

Outsourcing is part of the public debate as politicians seek to explain the lag in job growth despite a recovering economy, and as the Bush administration presses its initiative to "competitively source" more agency activities.

CROs and contract manufacturers had a decent second quarter, but they are hoping that Big Pharma comes through with a burst of trial start-ups in the second half of 2003.

The Biotechnology Industry Organization lends insight into the trends of biopharmaceutical contract manufacturing.

This second annual survey tracks teh growth of the outsourcing services sector in the past year.

The DSM investment puts biomanufacturing capacity in the spotlight. Contract biomanufacturers are adding new capacity and sponsors are marketing their excess capacity.

Gene Logic acquires TherImmune Research Corp. as part of its plan to create a new business model; First quarter results are a mixed bag for contract services companies.

The successful auction of Quintiles raises questions for the company's new owners, Pharma Services Holdings, Inc., and the entire pharmaceutical industry with regard to strategic investments, assets to be sold, and other concerns.

As demand for contract services slows down, contractors restructure themselves and the industry.

CROs and CMOs project strong business operation in 2003, and contract sterile manufacturing companies invest millions to increase capacity.

A column covering the outsourcing industry.

Developments in 2002 such as acquisitions, excess manufacturing capacity, and less funding for biotechnology will continue to affect the industry long into the new year.

December's Contract Services articles include "Using Virtual Private Networks to Gain Competitive Advantage," by Mark Tuomenoska and "Outsourcing Outlook," by Jim Miller.