OR WAIT null SECS
CMOs and CDMOs adjust business processes as demand for COVID-19 treatments and non-pandemic related therapies puts pressure on the bio/pharma industry.
After more than one year of rapid development and production of vaccines and therapies to address the COVID-19 pandemic, the bio/pharmaceutical industry is adjusting business practices and priorities as the next phase of response to this global emergency unfolds. Bio/pharmaceutical contract manufacturing organizations (CMOs) and contract development manufacturing organizations (CDMOs) are adjusting to a variety of demands and challenges caused by the pandemic, including ensuring a robust and safe supply chain.
When the pandemic initially began, many companies had to not only prepare for the influx of demand for COVID-19 treatments, but they also had to balance that demand with their existing workload. The CMO/CDMO industry was operating on a reactionary basis during the beginning of the pandemic, according to Tom Wilson, contract manufacturing lead at Pfizer CentreOne. “As it became apparent that we would be in this state for the long-term, we had to change our business processes and develop best practices to ensure we could partner remotely,” he says. Collaboration increased across CDMOs, says Wilson, and requirements were prioritized to meet the needs of patients.
The pandemic highlighted a variety of issues related to the biopharmaceutical supply chain, and supply chain risk mitigation, especially for APIs, has become increasingly important, says Gene Nakagawa, EVP business development at LGM Pharma. “In 2020, we saw an increasing focus on outsourcing of products directly related to COVID-19, such as Midazolam for intubation, antivirals, etc. Drug shortage lists have also been growing, partially due to demand but more often due to supply chain issues. In particular, starting materials for APIs have been hit with shortages,” Nakagawa says. “Supply chain has been difficult for many companies and continues to be. This has heightened the importance on safety stock and applies to both excipients and APIs.”
Joe Sinclair, vice president, corporate strategy and business development at Vibalogics, agrees the pandemic caused a global trade disruption, and supply chain management is crucial. “For many, this has meant evaluating alternative sources of raw materials, consumables, and suppliers for contract manufacture and product quality control testing,” Sinclair says. “Companies are actively focusing on mitigating risks by evaluating the expansion of their network of suppliers, and often onshoring activities or searching for domestic sources due to supply complexity, and the risks of being reliant on a single supplier, or a single region.” Vibalogics has optimized the security of its own supply networks and expanded its operations in the United States and Europe to address supply chain concerns, according to Sinclair.
The expectation of accelerated timelines also is a significant impact of the COVID-19 pandemic on the bio/pharmaceutical outsourcing industry, according to Mike Kleppinger, chief commercial officer at AMRI. “There has been a compression over the past 18 months that demonstrates the ‘art-of-the-possible’ in a crisis. We didn’t have the luxury of months-long contractual obligation discussions. COVID brought about a common purpose that drove more efficient timelines and was very outcomes-driven,” Kleppinger says.
“When it comes to clinical trials, market demand is high for products being manufactured by CDMOs. It’s a critical juncture where capacity is being challenged as trials that were delayed last year by COVID are now starting back up just as new trials are commencing with products that were in the preclinical phase a year or so ago. Those combined have accelerated demand for product,” says Bill Vincent, chairman and CEO at Genezen. In addition, approval requests for COVID-19 vaccines have increased the wait time for approvals for clinical trials for gene therapies, agrees Geraldine Guerin-Peyrou, director of Marketing and Communications at Polyplus.
“Add to this the continued trend of new, and often well-funded, start-up companies entering the cell and gene therapy space and there are even more products vying for limited capacity in the CDMO industry,” Vincent says. In addition, he says, demand has been compounded by the limited supply of raw materials and disposables caused by the need to produce COVID-19 vaccines. “It is likely that manufacturing capacity and supply of raw materials will be constrained for at least another year, but CDMOs (including Genezen) are investing in new facilities to address this,” Vincent says.
The surge in demand for specific APIs to treat COVID-19 patients, or investigate the use of existing drugs as treatments, in some cases impacted availability.
Wavelength Pharma, an API custom developer and manufacturer, saw an increase in demand during the pandemic due to the need for drugs to treat respiratory conditions in patients on ventilators for lengthy periods. “This sudden requirement to significantly boost production has emphasized the importance of adaptability for API CMO/CDMOs to maintain an uninterrupted drug supply, with some organizations proving better able than others to handle the pressures of rapid scale up to respond to the surging global demand,” says Ilan Avni, VP business development, marketing and IP, Wavelength Pharma.
“When it comes to new developments, a few bio/pharma companies are developing, or repurposing, molecules for COVID patients, and we are in discussions with a number of key players in the field. We have seen a number of innovators rejig their portfolio—speeding up drugs with a focus on COVID-19 while slowing down some of the other developments. We have seen an increase in outsourcing and have benefitted from the trend even as we continue to invest in capacity to meet customer needs,” says Saharsh Davuluri, vice chairman and managing director at Neuland Labs.
The pandemic also impacted the way the industry conducts business, says Britton Jimenez, vice president, business development at Metrics Contract Services. Virtual audits and site tours are now more common, as well as virtual internal and external meetings. “Many of these new practices that have been implemented will remain, but I do see the face-to-face engagement returning back to pre-pandemic state,” Jimenez believes.
“Video conferencing and remote communications dominate the way we perform internal and external communications. Since there is no way to visit facilities for an audit, at least in India for the time being, CMOs who have good track record will continue to get recommendations from fellow clients,” says Davuluri. Utilizing virtual technology has alleviated disruption and created more time for important tasks, according to Davuluri, but it also highlighted the importance of face-to-face interaction.
The industry as a whole has also continued to learn and connect virtually. “The virtual international conferences have also allowed for scientists that usually don’t travel to participate and to hear about the latest innovations, hence we may see a rush of scientific outbreak in the next few months due to this,” states Guerin-Peyrou.
New parameters created by the pandemic caused business challenges for some companies, and attracting new clients became difficult. “Without the traditional methods of in-person meetings and audits, sponsors have adopted and accepted the need to use virtual methods of communication and remote technologies to access and assess potential partners,” says Andrew Henderson, chief commercial officer at Sterling Pharma Solutions.
To adjust to these challenges, companies have taken stock of their processes and strategies. “COVID-19 has made everyone in the industry revisit their sourcing strategies and risk management; even companies with stable in-house facilities have reassessed their risk profiles and vulnerabilities in supply chain, and sought after CDMO partnerships,” says James Choi, chief information and marketing officer at Samsung Biologics.
Choi sees the company’s investments as important to enduring the trials of the pandemic. “For example, our investment into Plant 4 expansion, the opening of our San Francisco R&D Center, and providing mRNA vaccine fill and finish, are few of our preemptive approaches in response to the shifting industry,” he states. “Our sustainable and robust business management systems, in which we have invested proactively to be ISO 22301-certified across all of our business areas, have been central to withstanding market disruptions over the last 18 months amid the COVID-19 pandemic.”
“For Vectura, there have been two areas of focus: keeping our people safe, and minimizing disruption to the supply of medicines and to our customers,” says Matthew Barker, director, Corporate Strategy at Vectura. “Our team has embraced new ways of working, which include adhering to new health and safety protocols across sites; showcasing our inhalation expertise virtually at conferences; and navigating the sales and supplier audit processes remotely.”
Adapting became key to meeting demand. “We embraced technology, looking for new ways we could communicate effectively and developed innovative audit processes which enabled us to meet obligations,” says Wilson.
In 2020 and 2021, CMOs and CDMOs found themselves needing to balance the demand of the development and manufacture of treatments of COVID-19 with the projects in the pipeline and new non-COVID-related products. Some companies expanded capacity and resources to meet these priorities.
While noncritical therapies were de-emphasized for a few months because of COVID-19, according to Kleppinger, manufacturing these products was still necessary during the pandemic. “We didn’t experience a disruption in our traditional business demand because of COVID; what we found was COVID was additive to our workload,” he says.
“CDMOs, such as Vibalogics, have taken steps to expand their capacity, and to use their existing resources to adapt their business to not only the vaccine service market, but also to build strength in capability for the classes of next-generation modalities,” says Sinclair.
“CDMOs are waiting for consensus on vaccination guidelines, as tied to future demand for COVID-19 vaccine production. Currently, the focus is on addressing lingering supply challenges for first-round vaccinations, while building further strength into ongoing future supply demands. There are still many drug development companies optimizing their approach, initiating Phase I clinical trials, and looking to bring further benefit to market by building supply security with additional approved and technologically advanced modalities,” says Sinclair.
“Away from the now-established supply chain of COVID products, there remains the need to support innovation and research in the existing development pipelines as pharma companies concentrate on their core indications,” says Henderson. “This remains as strong as ever, so the need for CDMOs to be flexible and to be able to support these is crucial. This does not mean that there is a shift in focus, but companies need to have the capabilities to support the evolving needs of innovators.”
Oncology’s place at the top of the contract manufacturing industry’s focus was shifted to treatments for infectious diseases, says Vincent, citing market research data (1). Because COVID-19 vaccines are now getting approved, the shift in focus has turned back to non-COVID products. “The immuno-oncology market particularly is expected to continue growing and witness minimal impact from the COVID-19 pandemic, with 2020 accounting for a momentary decline (2). Given the complexity of products and the prevalence of small biotechs involved in the market without the necessary infrastructure to scale and manufacture products, reliance on CDMO partners will be a key requirement for the foreseeable future,” Vincent says.
“A lot of potential opportunities for CDMO services are focused on ANDA/OTC [abbreviated new drug application/over-the-counter] products not related to COVID-19. There is also an anticipation that cough/cold will come back as the economy starts to open up and kids are back in school,” says LGM Pharma’s Nakagawa.
“Non-COVID products are back in demand, but timelines have shifted,” says Guerin-Peyrou. "For gene therapy, delays to get GMP AAV manufacturing slot can be from 12 to 18 months today.”
While the demand for COVID-19 treatments will continue for a while, according to Wilson, most CMOs/CDMOs “are now re-establishing their operating levels and delivering on all obligations.”
COVID-19 hasn’t been the only thing to change and shape the bio/pharma outsourcing industry in recent years. Phil Vanek, CTO at Gamma Biosciences has seen some interesting developments in the cell and gene therapy field. “We’ve seen a number of trends that are very interesting in particular within the cell and gene therapy space. The first is the continuing consolidation of a number of the CDMOs that is reshaping the manufacturing landscape—MaSTherCell and Paragon acquired by Catalent, Brammer Bio being acquired by Thermo Fisher Scientific, and the interesting move of Charles River Laboratories acquiring Cognate (which in turn had recently acquired Cobra) thereby doubling down on their cell banking and supply services,” says Vanek.
1. Global Data, “COVID-19 is Driving More Supplier Redundancy,” Press Release, Nov. 4, 2020.
2. Research and Markets, “Global Immuno-oncology Market Report 2020: I-O Market is Expected to Reach $132.66 Billion by 2025, Growing at a Rate of 11.6% and Witness Minimal Impact From COVID-19,” Press Release, March 1, 2021.
Susan Haigney is managing editor of Pharmaceutical Technology.
Vol. 45, No. 7
When referring to this article, please cite it as S. Haigney, “Balancing Pressing Priorities,” Pharmaceutical Technology, 45(7) 2021.
Editor's Note: This is a revised version of the article published in the July 2021 issue of Pharmaceutical Technology.