Navigating Financial and Opportunity Risks in Accelerated Drug Launches

PharmTech recently spoke with Mike Stenberg, Vice President – Business Development, LGM Pharma, to get his perspective on trends that shaped pharmaceutical development and manufacturing in 2025 and where things are headed in 2026. In this part 3 of our three-part interview, Stenberg explores the evolving manufacturing paradigm in the pharmaceutical industry, driven by accelerated FDA approval timelines. Traditionally, companies have relied on a 10-to-12-month approval window to finalize launch plans; however, with approvals now potentially occurring in one to two months under programs like the FDA Commissioner’s National Priority Voucher (CNPV) pilot, the primary bottleneck has shifted from the FDA to the production floor, Stenberg notes. He emphasizes that to take advantage of CNPV, companies must first onshore their manufacturing to the United States.

Because the "padding" between submission and approval has largely vanished under CNPV, manufacturers must now integrate commercial-scale planning from the very beginning of a drug's development, Stenberg continues. This "day one" approach requires identifying and securing supply chains upfront, a process that demands significant time, capital, and "boots on the ground." Furthermore, formulation must now be conducted with an eye toward immediate scale-up, ensuring that equipment is ready to move a product from the bench to commercial volumes without the luxury of an interim adjustment period.

Stenberg highlights that activities previously reserved for the phase following submission—such as procuring excipients and packaging—must now occur much earlier to ensure a successful launch. This shift introduces substantial financial and opportunity risks. If a drug fails to receive approval, companies are left with a "huge hole" in their manufacturing schedules and a significant loss of expected revenue, compounded by the cost of materials already brought in-house.

Ultimately, while the industry benefits from faster patient access to drugs, Stenberg notes that the transition requires a difficult adjustment. The risk has moved earlier in the development process, forcing companies to commit resources and production capacity before a final regulatory decision is reached.

Transcript

Editor's note: This transcript is a lightly edited rendering of the original audio/video content. It may contain errors, informal language, or omissions as spoken in the original recording.

Step one in shifting your playbook is you have to be in the United States to take advantage of the voucher program. So, step one: onshore your manufacturing and move to the United States. But having done that, it's a bit of a dilemma. We have in our industry, bemoaned forever the fact of how long it takes to get a drug approved, and I think 10 to 12 months is a dramatic improvement. It used to be 18 months. But having said that, we also baked it into our processes and we baked it into our timelines. And we came to depend on that time. So now what's happened is you move the bottleneck associated with FDA approval, you move that bottleneck to the production floor.

And, so, approval's not the issue anymore. It's manufacturing the drug in commercial volumes. So that means you have to do everything earlier. In fact, you have to do it right from the beginning of the program. You have to identify and secure your supply chains right up front. That's not something you can do on the fly, by the way.

You have to have already started doing that kind of stuff because it takes boots on the ground, it takes time, it takes a lot of money to do those things. You also have to start formulating with an eye towards immediate scale up. So you have to have that entire equipment trained somewhere in your facility so that you can go from the bench all the way to commercial volumes.

It really affects virtually everything we do in the manufacturing world. You're having to do so much more of that from day one, from securing your supply chain to formulating more quickly, but formulating to scale up immediately. We used to have some time to do those kinds of things. That time is gone. We'll adjust of course, and it's a good thing overall, but I think the industry's gonna miss that timeline, that padding, that they had between submission and approval.

When you look at the supply chain, alone, and when you think about bringing in the materials for a commercial scale up, especially if it's gonna be a big drug as opposed to say an orphan drug, that means, yeah, you've secured your supply chain and you understand where you're gonna get your supply, but you have to bring that supply in early, right?

You have to bring in all the materials and all of excipients and all of the packaging required for immediate scale up and commercialization. That has always been—that planning for launch—has always been typically what occurred during that interim phase, “Hey, we've submitted, things look good. We have 10 to 12 months, if not longer, to prepare for the actual manufacturing and launch across the board of this particular product.”

So yeah, you have risk associated with the materials that you have to bring in. Industries like ours have opportunity risk. If we're planning to scale up, we started to carve out space in our schedule and on our machines to manufacture that product. That goes away, you have a huge hole in your schedule, and you have a huge hole in your potential and expected revenues as well.

So yeah, the risk is substantial and it moves the risk earlier on in the process.