Pharma Market resources- Contract manufacturing Interview – Part 1


Pharma IQ
10/31/2012

This series details Pharma IQ’s interview with three prestigious members of the pharma market - Jim Browne - GPCM Advisor at GlaxoSmithKline, Sascha Basten- Associate Director at MS-TechOps and Dr Ian Walker Head of Project Leadership at Acacia Pharma.

For the rest of this series, please visit our Pharma Market resource centre.

What are the key drivers for contract manufacturing in pharmaceuticals and biopharmaceuticals?

J BrowneProfit levels in Pharma have reduced over the last 5 years putting manufacturing and product costs under greater scrutiny. With fewer New Products being approved and reducing volumes of existing products due to patent expiry and generic competition big Pharma companies are having to reduce the size and cost of their internal Manufacturing networks and look for cheaper sources of products.

S BastenBesides costs market protection is an additional driver in contract manufacturing. Countries are putting up there fences to support their national economy by increasing import taxes or creating regulatory hurdles for imported products. To stay present in these markets, and to get by these kinds of hurdles, products need to be manufactured locally. Russia is one of the most famous cases. Finally this leads to complex supply networks and, because of a less focused production volumes, to higher cost. This leads our industry in the opposite direction as we intended to reduce cost and complexity.

I WalkerNot all businesses have integrated manufacturing capability and that for the virtual pharma sector contract manufacturing and outsourcing is the default position through choice. The scope of the sector is diverse and may range from small research and development based companies moving into clinical manufacture through to speciality businesses sourcing a portfolio of commercial products from multiple providers, operating within a partial or a totally virtual model. Key drivers are that the coreexpertise of the business does not include manufacturing and/or it is not practical or efficient in terms of costs and time to develop a dedicated facility or in house infrastructure.

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