The evolving bio/pharmaceutical business model poses risk for CMOs.
By Jim Miller
Two fundamental cornerstones of the new bio/pharmaceutical business model are the end of the blockbuster product and the need to accumulate and conserve cash. These two realities have major implications for bio/pharmaceutical manufacturing strategies and technologies and create new challenges for CMOs. It is widely understood and accepted that the new products coming out of the bio/pharmaceutical pipeline will be sold in smaller volumes than the products introduced a generation ago (albeit at higher prices). This situation partly reflects the failure of bio/pharmaceutical R&D laboratories to come up with safe and effective drugs suitable for broad populations. More importantly, it also reflects the growing understanding of how drug effectiveness varies within patient groups, the ability to develop biomarkers to identify patients for whom new drugs will work best, and the expectation of regulatory authorities that new drugs will incorporate that knowledge into clinical regimens. The classic example is Roche's/Genentech's Herceptin (trastuzumab), which is highly effectively for the 20% or so of breast-cancer patients that test positive for expressing the HER-2 gene.
This article was also published in our US sister publication Pharmaceutical Technology and can be read here.