CPHI Frankfurt: Selecting the Right Outsourcing Strategy and Partner

Ahead of the newly rebranded and returning CPHI Frankfurt, occurring Nov. 1–3, 2022, CPHI’s content team provided a comprehensive analysis on the findings and potential implications of the 2022 CPHI pharma outsourcing report–The Future of Outsourcing(1). Nearly six months in drafting, with insights from some of the industry’s best chemistry, manufacturing, and controls (CMC) consultants and drug development experts, the report provides invaluable suggestions into how to get and stay ahead in the increasingly competitive world of contract development and marketing organization (CDMO) partnering. Shared exclusively with Pharmaceutical Technology, the report analysis comes at a key moment as many CDMOs review their partnering options at CPHI Frankfurt, with many innovators struggling for capacity at existing partners. This article explores the key considerations sponsors should investigate ahead of choosing a new outsourcing partner, the questions to ask and how to establish a futureproof resource—especially important as a product nears commercial launch.

The challenge of selecting the “right” outsourcing partners is now a strategic priority for all innovators, and planning must begin far earlier than even just a few years ago. This is further complicated by the plethora of options, not only in terms of the sheer numbers of CDMOs, but in the types of services and specialisms they offer. Putting aside the option of in-house development, innovators must consider whether it is better to go for a two-CDMO strategy (i.e., one for drug substance and one for drug product), a larger full-service provider, or to work with a specialist integrated development partner earlier before re-reviewing their options in Phase I or II. These are profound questions that will very likely decide an innovator’s ability to make it to market, as well as the timelines for reaching new milestones. Is it better to advance to Phase I faster and lose time later, or take a slow and steady approach? These are some of the questions the CPHI outsourcing report examined.

Is phase-appropriate development yesterday’s model?

One of the most significant changes to be seen across discovery and development in recent years is a sector-wide tightening of timelines and increasing expectations around speed.

With innovators increasingly turning to compressed timelines, development methods are shifting in response. For example, phase-appropriate development—whereby an innovator seeks to advance to just the next key milestone as quickly as possible—is still seen in the marketing of the majority of CDMOs, but experts in this report strongly advise against taking this approach. Traditionally, outsourcing strategies were designed to help secure next-stage funding, but many biotechs and small pharma companies are now entering development with more robust cash flows and the ability to plan further downstream. This opens the door for innovators to plan more fully a product’s roadmap from discovery to commercial launch.

Reflecting the dilemma many face when picking a CDMO to get to an investigational new drug (IND) submission,Bikash Chatterjee, CEO of Pharmatech Associates commented in the report, “There are lots of strong chemistry houses out there that can get you to IND, if that’s your goal, but an IND is where you lay the foundational CMC, quality, and clinical arguments for your ultimate submission. Developing an IND strategy with the end submission in mind is how a drug sponsor shrinks their time to market and lowers program risk. For drug sponsors relying upon their CDMO partner for program insight, an early-stage specialist may not be the best way to realize overall program acceleration.”

Drug sponsors also need to decide whether to use two or more CDMOs (i.e., one for drug substance and one for drug product), a larger full-service provider, or to work with a specialist integrated development partner earlier before re-reviewing options in Phase I or II. However, according to Brian Scanlan, operating partner–Life Sciences at Edgewater Capital, “mid-sized outsource partners may be a better fit for highly nimble biotechs who are willing to accept the added complexity of working with multiple vendors as a trade-off for quality and cultural alignment” (1).

Valdas Jurkauskas, senior vice president at Pardes Biosciences advised that it’s not only synthetic routes that need to be optimized, but also data packages (1). He adds, “the redoes are the killers of program timelines, and we see that very often in the oncology space. For example, Phase I studies are short with very few subjects, allowing the company to expand into Phase II, and the quality presentation requirements, both in the United States and European Union, are much more demanding than for Phase I. So it may be that quality is in place, however, the quality presentation is not ready for Phase II pivotal studies.”

For accelerated pathways, innovators will need both a ‘pharma ready’ process in early development, and to be fully prepared for a post approval change order.

Stephanie Gaulding, MD at Pharmatech Associates, added,“Typically, I would say within the first year or so the majority of those that are going through accelerated pathways do see some level of change associated with the manufacturing process. In my experience, it's hard to get the process fully optimized from the get-go. In this case, a pharma-ready formulation is still needed to get through approval, but innovators must also plan for post-approval manufacturing improvements” (1).

Biotechs go longer into development than before

Overall, biotechs are approaching CDMOs with a more fleshed-out roadmap and the intention of advancing further from the offset. Some are even bringing in CMC talent and looking towards building in-house manufacturing.

According to Jurkauskas “the most critical thing for a biotech company is to develop its own technology and controls, and that takes time. So, once technology and control [are] defined at least to some extent, it is much easier to identify the most suitable CDMO partner for registration, validation, and commercial.”

Biotech vs. Big Pharma

Large pharmaceutical companies generally have in-house CMC experience and options in terms of how they approach their outsourcing. Consequently, the greatest difference in outsourcing strategy between Big Pharma and biotechs is the role outsourcing plays in the company’s business strategy. Where Big Pharma may only want to outsource a limited component, biotechs generally see outsourcing as a fundamental part of their business plan. Unsurprisingly, experts believe the latter approach—which fosters deeper partnerships—will always garner the greatest value from CDMOs.

For Big Pharma companies with multi-target programs, it is feasible to look at just the largest and most capable partners and select according to their needs. But for biotechs, securing the development capabilities they don’t have is the highest priority, at least initially. Surprisingly, an anonymous director of external manufacturing (DEM) at a Big Pharma company notes that the major players could take notes from the relationship-based approach employed by biotechs.

For accelerated pathways, the innovators will need both a ‘pharma-ready’ process in early development, and to be fully prepared for a post-approval change order.

“Typically, I would say within the first year or so the majority of those that are going through accelerated pathways do see some level of change associated with the manufacturing process. In my experience, it's hard to get the process fully optimized from the get-go. In this case, a pharma-ready formulation is still needed to get through approval, but innovators must also plan for post approval manufacturing improvements,” Gaulding stated in the report.

The effect of acquisitions

According to Scanlan, mid-sized outsource partners may be a better fit for highly nimble biotechs who accept the added complexity of working with multiple vendors as a trade-off for quality and cultural alignment.

The challenge here is that a wave of acquisitions in the past few years means that the market is increasingly spilt into large and small contract providers. Moving forwards, the question is will many of the smaller firms, who often offer excellent chemistry services, grow to fill this gap? That might be a great solution in a growing outsourcing space.

Perhaps the most significant takeaway for sponsors is that they must look at early development with new eyes and have a development strategy and pathway mapped out much earlier than before—irrespective of the number of CDMOs or complexities involved. In fact, the work undertaken in early or in preclinical, mapping out a route to commercial, is perhaps the most important component of successfully turning ideas into therapies.

Expert tips for working with CDMO partners and contract setting

According to Chatterjee, “every CDMO has a quality system around it. You need to define the rules around how the drug sponsor interacts with their quality system. For example, if there's a deviation or a nonconformance that takes place during the manufacturing run, are there rules around how the drug sponsor participates in that quality investigation?” Once a drug sponsor selects a CDMO partner, certain parameters need to be laid out before the relationship can move forward. Naturally, experts advise drawing up contractual agreements that outline responsibilities and expectations at the very beginning of the process.

On CDMO contract setting, Gaulding, added, “a quality agreement should work part and parcel with the master service agreement and not separately, to provide clarity when it comes to quality decision-making responsibilities.”

Conclusion

In the report, multiple strategies were reviewed for selecting an outsourcing partner, as well as taking a broad look at the CDMO market for API and finished formulations of innovative solid dose drugs. Exploring the shift in development models and the additional complexities of accelerated pathways.

Perhaps the most consequential learning of this report relates to the fact that innovators are making outsourcing decisions much earlier than before. Experts were unanimous in their recommendation to develop a roadmap from the outset and stressed the importance of process development as early as the pre-clinical phase.

Another important insight is that all CDMOs are now expanding, and experts foresee that perhaps some of today’s current niche players will quickly grow to become mid-sized CDMOs.

With all of these factors in mind, innovators should focus on establishing solid relationships with vendors. Innovators that are able to form these partnerships now will reap the benefits in the future. However, access to a perfect CDMO partner should not be taken as a given and innovators need to get out among the market—whether at events like CPHI Frankfurt or in person and onsite—and see what best fits their product, their company, and their culture.

Reference

CPHI, The Future of Outsourcing–Strategies for Partner Selection, Informa, July 11, 2022.

About the author

This article was authored by the CPHI Frankfurt Content Team.